Stock market guru Bernard Madoff fell hard from his perch this week--arrested for masterminding a $50 billion swindle. He now gets to join a storied Rogue's Gallery of stock market grifters that includes Ivan Boesky, Michael Milken, Ken Lay and the Enron Boys, etc.
One has wonder what it is that makes people like Madoff tick--it's not like the guy was poor before he started his scheme. It just seems that, like so many on Wall Street before him, he was consumed and blinded by greed.
Perhaps the answer Madoff's motivations, and the infamous others like him, can be found in the details of a medical study published earlier this year. The researchers looked at hormone levels in male traders on the London stock exchange. What they found is that the key to success or failure could be due the balance between testosterone and coritsol, two endogenous hormones. Traders, they found, with elevated levels of tesotsterone were more likely to be profitable. They surmised that testosterone increased the traders' risk-taking behavior.
On the other hand, the higher the level of testosterone, the more likely the traders were to make impulsive decisions and overdo it, leading to losses.
Balance this with levels of cortisol, a stress hormone. Cortisol levels rise in response to emotional stress. In the case of traders, it's probably meant to inhibit some of their risk-taking behavior. Of course, if you become too risk averse, you won't take risks, leading to lost opportunities.
So when it comes to testosterone and cortisol, it's the old Yin-Yang argument. We need both, in the right amount, to achieve a reasonable balance.
Ok, back to Madoff. If you buy this study, then we could surmise the following: Bernie got rich because his testosterone levels were calibrated to get the most for his risk. However, and perhaps over time, levels became imbalanced against inhibitory cortisol, and he never came down to earth. The consequence: Probably jail.
All this is total speculation on my part. But perhaps the court will order Bernie to submit to some lab testing so we can find out. On the other hand, perhaps it's all B.S. and the guy was just an unconscionable smug character who got ultra-rich at everyone's expense because nobody (like Chris Cox of the SEC) was keeping an eye on him, one who deserves the nickname some have given him: Bernie Made-off
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Comments
But the study you site didn't include a viable that seems to be significant. The traders were not engaged in a criminal activity. It seems that would almost disqualify this particular study from application to Madhoff.
Maybe not. But using my education to develop a theory
as I was saying.
I think Madhoff will be almost certainly found to have a traumatic incident leading to great personal loss in his life. Probably in adolescence.
His behaviour was viciously anti-social. He was out to hurt people. It was compensating for loss. He was, as you say, not in need of money. So I would submit that that's not what it was about.
Had I not been considered invaluable in my position on the deep fryer, I would have pursued psychology more passionately.
reagards,
RH
Actually, for the worst of the lot, I favor capital punishment -- live on TV. Same goes for doctors who cheat Medicare. And that's a liberal speaking. Harsh, you say? Nope. Here's why.
First off, the consequences of these criminal acts are fare worse than what happens when some scumbag holds up a 7-11 to feed his habit. Millions of people will suffer for Bernie's crimes.
Second, treating these crimes with a pat on the hand passes the message down throughout the economic system that it's okay to steal, as long as you steal big.
Finally, on the individual level, if there is any such thing as deterrence, it may actually work with those who have something to lose besides a bad crack habit.
are you trying to say that Madoff was an anti-social nerd in high school who is overcompensating by robbing? Actually, that's a pretty good theory,
I agree-the punishment needs to be harsher than a club fed sentence.
Madoff was involved in a fairly stright forward Ponzi Scheme which lured new investors in by paying off older investors with new investor's money. Although his activities could easily be exlained on the basis of old fashioned greed, and over-inflated egotism, there may have been underlying biological basis to his criminal behavior.
There are a few questions relating to the Madoff incident, which can applyto any other criminal behavior, for that matter.
Was there an issue of substance abuse? Another question to ask regarding drug abuse is to look as legal prescription drug use such as SSRI antidepressants, Benzodiazipines, Ritalin, etc and other mood altering drugs. I would not be surpised if the media came out with reports of these types of chronic drug abuse in the Madoff case.
Were there toxicities such as lead intoxication? ( which has been associated with impulsivity). Was there an organic brain lesion such as brain tumor, abnormal MRI, seizure disorder suggesting abnormal brain tissue?
Regarding hormone levels, there are a number of studiers usuing salivary testosterone and cortisol assays showing elevated testosterone correlating with aggressive criminal behavior, and low cortisol correlating also with anti-social behavior. Low AM cortisol has also been implcated in chronic fatigue syndrome.
Was Madoff Lead Intoxicated?
"Exposure to toxic trace elements is yet another factor that has been shown to interfere with brain function and behavior. Chronic or acute exposure to lead, for example, has a deleterious effect on brain function... Sources of lead include our diet and environment (e.g., paint chips and house dust), and contamination among children may be serious and grossly underestimated (Bryce‑Smith and Waldron, 1974; Moore and Fleischman, 1975).
Resulting impairments may be manifested as learning disabilities and cognitive deficits, particularly in measures of school achievement, verbal and performance IQ, and mental dullness (see Benignus et al., 1981; Lester and Fishbein, 1987; Pihl and Parkes, 1977). Because of the high correlation among school failure, learning disabilities, and delinquency, lead intoxication is a relevant criminological issue.
A growing body of research has further demonstrated that lead intoxication is significantly associated with hyperactivity and impulsivity (David et al., 1972; Needleman et al., 1979), putative precursors to delinquency, and criminal behavior (Denno, 1988). Following chelation (removal) of lead from the body, David et al. (1976) found behavioral improvements among hyperactive children. Pihl et al. (1982) reported that violent subjects had significantly elevated concentrations of lead compared with nonviolent criminals. They further suggest that subtoxic levels of lead have a potential effect on behavior and that lead detection can be an important diagnostic procedure. Children who are at risk for exposure to lead also tend to have poor diets, that is, diets low in calcium and iron, which help to protect the body from lead's effects."
Was Madoff involved in Substance Abuse?
"Certain drugs, particularly many of the illicit drugs, are reported to increase aggressive responses, for example, amphetamines, cocaine, alcohol, and phencyclidine (PCP).
Several biological mechanisms have been proposed as explanations for alcohol‑induced aggression: (1) pathological intoxication, sometimes involving psychomotor epilepsy or temporal lobe disturbance (Bach‑y‑Rita et al., 1970; Maletsky, 1976; Marinacci, 1963); (2) hypoglycemic reactions (low blood sugar; Cohen, 1980; Coid, 1979; Wallgren and Barry, 1970); and (3) alterations in neurotransmitter activity (Weingartner et al., 1983)....
Chronic use of PCP, an illicit drug that is commonly used in combination with marijuana, has been repeatedly associated with extreme violence to self and others in individuals both with and without histories of violent behavior (Aronow et al., 1980; Fauman and Fauman, 1980; Linder et al., 1981; Schuckit and Morrissey, 1978; Seigal, 1978; Smith and Wesson, 1980). ..
reference:
http://www.criminology.fsu.edu/crimtheory/fishbein90.htm
Salivary Testosterone testing shows elevated levels in criminals.
http://www.springerlink.com/content/k761j1u1418616q7/
Salivary testosterone and cortisol among late adolescent male offenders. Journal Journal of Abnormal Child Psychology
"The relationship of salivary testosterone and cortisol concentrations to personality, criminal violence, prison behavior, and parole board decisions was examined among 113 late-adolescent male offenders. Offenders high in testosterone committed more violent crimes, were judged more harshly by the parole board, and violated prison rules more often than those low in testosterone. No main effects for cortisol emerged."
By the way...where does the money go when these people go buck wild?
thanks for your thorough input
whatever the cause, I agree--jailbird he should be