Eventually the animals lost the will to escape, even once they could do so…
The title of this post relates to the so-called “learned helplessness” state, as described by Martin Seligman, a psychologist during the 1960´s, describes Rogue Hormones, The Economist´s article on trading psychology,
Tha article cites the research by John Coates, a neuroscientist at Cambridge University and a former derivatives trader, who studied trader´s level of Cortisol -a hormone that can make them overly fearful and risk-averse during various market conditions.
Cortisol prepares humans for danger, partly by helping the brain retrieve important memories. This early-warning system is invaluable in the wild. But raging hormones can eventually wreck investors’ ability to think rationally. Chronic stress over weeks or months can produce so much cortisol that the brain focuses excessively on negative memories and perceives threats where they do not exist. This loss of judgment is exacerbated by other symptoms of stress, such as sleep deprivation.