Fear and greed are terms that make light of the uncertainty in the finance world. Huge global financial institutions rely on emotional relations of trust and distrust to suppress the uncertainties. Many financial firms develop policies towards risk, rather than accepting the reality of an uncertain future.
Emotions in Finance examines the views of experienced elites in the international financial world. It argues the current financial era is driven by a utopianism – a hope - that the future can be collapsed into the present. It points out policy implications of this short-term mentality at the unstable peak of global finance.
This book provides a timely account of the influence of emotion and speculation on the world's increasingly volatile financial sector . The author includes absorbing interview material from public and private bankers in the United States, UK and Australia.
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•Â Evidence from international financial elites – with original focused interviews– on Central Banks, Investment banks & finance press
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•Â Novel argument based on major research that uncertainty breeds distrust and fear at impersonal levels of struggles for attributions of success, blame & above all, credibility
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•Â Major critique of present financialisation of life as driven by the top organisations, not an amorphous aggregate in financial markets.
Contents
1. Global markets or social relations of money; 2. Emotion in the kingdom of rationality; 3. Financial media as institutional trust agencies; 4. Emotions in the boardroom; 5. Credibility and confidence in central banks; 6. Hierarchy of trust; 7. Overwhelmed by numbers; 8. Time utopia in finance; 9. Implications: emotions and rationality.
Reviews
'This careful, empirically based study of financial markets is a valuable addition to the growing literature on the behavioural aspects of markets. The pervasive feature documented by Pixley is Keynesian uncertainty, rather than narrow, quantifiable risk. The book highlights the elusive but nevertheless crucial role played by structures of impersonal trust.' Paul Ormerod, author of The Death of Economics
'Emotions in Finance gives us a bold, thoroughly researched analysis of the central paradox of the modern capitalist world. Its apparent predictability and rationality is, in fact, founded on the most fragile and potentially unstable component – money. Using fascinating interviews, Jocelyn Pixley shows how the most powerful agents in the modern economy – bankers, financiers, economists – try to deal with this insuperable problem. In face of the radical uncertainty of an unknowable future, it is – as this important book explains – a question of “emotions”.' Geoffrey Ingham, University of Cambridge
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