Book Description
Everyone from journalists to market pros are turning to behavioral finance to explain, analyze, and predict market direction. In contrast to old-school assumptions of cool-headed rationality, the new behavioral school embraces hot-blooded human irrationality as a core feature of both individuals and financial markets. The 2002 Nobel Prize in Economics was awarded to scholars of this new scientific approach to irrationality. In Mean Markets and Lizard Brains, Terry Burnham, an economist who has a proven ability to translate complex topics into everyday language, reveals the biological causes of irrationality. The human brain contains ancient structures that exert powerful and often unconscious influences on behavior. This "lizard brain" may have helped our ancestors eat and reproduce, but it wreaks havoc with our finances. Going far beyond cataloguing our financial foibles, Dr. Burnham applies this novel approach to all of today's most important financial topics: the stock market, the economy, real estate, bonds, mortgages, inflation, and savings. This broad and scholarly investigation provides an in-depth look at why manias, panics, and crashes happen, and why people are built to want to buy at irrationally high prices and sell at irrationally low prices. Most importantly, by incorporating the new science of irrationality, readers can position themselves to profit from financial markets that often seem downright mean. Mean Markets and Lizard Brains skillfully identifies the craziness that is part of human nature, helps us see it in ourselves, and then shows us how to profit from a world that doesn't always make sense.
TERRY BURNHAM is a leader in the application of biology to economics and finance. He was an economics professor at Harvard for many years, beginning at the Kennedy School and, most recently, at the Harvard Business School. His biological research has taken him to Africa to observe wild chimpanzees and to the laboratory to study the role of testosterone in negotiation. He is coauthor of the international bestseller Mean Genes. Before joining the Harvard faculty, he worked at Goldman Sachs & Co. and was the president and CFO of the successful start-up biotechnology firm, Progenics Pharmaceuticals, whose work in AIDS and cancer treatment has been widely praised. Dr. Burnham has a PhD in business economics from Harvard University, a master's in finance from MIT, an MS in computer science from San Diego State University, and a BS in biophysics from the University of Michigan. He served with distinction as a tank driver in the U.S. Marine Corps.
TERRY BURNHAM is a leader in the application of biology to economics and finance. He was an economics professor at Harvard for many years, beginning at the Kennedy School and, most recently, at the Harvard Business School. His biological research has taken him to Africa to observe wild chimpanzees and to the laboratory to study the role of testosterone in negotiation. He is coauthor of the international bestseller Mean Genes. Before joining the Harvard faculty, he worked at Goldman Sachs & Co. and was the president and CFO of the successful start-up biotechnology firm, Progenics Pharmaceuticals, whose work in AIDS and cancer treatment has been widely praised. Dr. Burnham has a PhD in business economics from Harvard University, a master's in finance from MIT, an MS in computer science from San Diego State University, and a BS in biophysics from the University of Michigan. He served with distinction as a tank driver in the U.S. Marine Corps.
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Praise for Mean Markets and Lizard Brains
"A thought-provoking read that gives insight to human behavior and your investment strategies."
Isiah Thomas, President, Basketball Operations, New York Knicks
"Mean Markets and Lizard Brains translates neuroeconomics and cutting-edge theories of human behavior into practical advice. While the causes of costly decisions often lie outside our conscious awareness, they need not remain a mystery. The writing is provocative and insightful."
Professor Vernon L. Smith, Nobel Prize winner in Economics
"A lively and entertaining account of the emerging field of neuroeconomics, where Fear and Greed meet Nature red in tooth and claw, with some surprisingly practical implications for individual investors, portfolio managers, and other market prognosticators."
Andrew W. Lo, Harris & Harris Group Professor, MIT Sloan School of Management, and director of MIT's Laboratory for Financial Engineering
"Mean Markets and Lizard Brains is a whole new way of approaching the world of finance. It explains why we should question the financial advice of our friends, colleagues, and advisors. For years, my wife and I have relied upon Terry's financial advice. We are glad that this excellent book makes his discoveries available to everyone."
Mark-Paul Gosselaar, actor, NYPD Blue
"Should be required reading for anyone trying to understand financial markets. It is the first book positioned at the intersection of finance, biology, and psychology but it does not require knowledge of any of these fields. The author, one of the pioneers in the field of economics grounded in biology, combines accessibility with rigor. Reading it (along with everything Burnham writes) is a delight."
Nassim Nicholas Taleb, author of Fooled by Randomness
"A thought-provoking read that gives insight to human behavior and your investment strategies."
Isiah Thomas, President, Basketball Operations, New York Knicks
"Mean Markets and Lizard Brains translates neuroeconomics and cutting-edge theories of human behavior into practical advice. While the causes of costly decisions often lie outside our conscious awareness, they need not remain a mystery. The writing is provocative and insightful."
Professor Vernon L. Smith, Nobel Prize winner in Economics
"A lively and entertaining account of the emerging field of neuroeconomics, where Fear and Greed meet Nature red in tooth and claw, with some surprisingly practical implications for individual investors, portfolio managers, and other market prognosticators."
Andrew W. Lo, Harris & Harris Group Professor, MIT Sloan School of Management, and director of MIT's Laboratory for Financial Engineering
"Mean Markets and Lizard Brains is a whole new way of approaching the world of finance. It explains why we should question the financial advice of our friends, colleagues, and advisors. For years, my wife and I have relied upon Terry's financial advice. We are glad that this excellent book makes his discoveries available to everyone."
Mark-Paul Gosselaar, actor, NYPD Blue
"Should be required reading for anyone trying to understand financial markets. It is the first book positioned at the intersection of finance, biology, and psychology but it does not require knowledge of any of these fields. The author, one of the pioneers in the field of economics grounded in biology, combines accessibility with rigor. Reading it (along with everything Burnham writes) is a delight."
Nassim Nicholas Taleb, author of Fooled by Randomness
