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Investors in Spanish banking gained 50% in months. But with the bankruptcy of a bank in California they panicked

The capuchin monkey is a pretty smart ape.

He is not at the level of an orangutan, but he knows how to handle tools and prepare ointments against parasites.

Keith Chen, a famous economist specializing in individual behavior, used seven capuchin monkeys in 2005 to try to find out if they could handle money.

The experiment was carried out at Yale University together with the cognitive psychologist Laurie Santos.

And it turned out interesting.

In a matter of half a year, the Capuchins learned to treat the silver discs that Chen and Santos had given them as money.

Each monkey used the 12 discs they received periodically to buy food.

The shocked researchers went a step further and manipulated prices.

The grapes went up, the jelly went down.

The goal was to see to what extent the capuchins behaved like a human.

And they did.

They went on to buy fewer grapes and more jelly.

Another human trait: one of the capuchins tried to steal the box where Chen and Santos stored the silver discs.

Capuchins even saved.

One of them had a disc saved.

One day, the thrifty monkey began to pet another and handed over the silver disk.

Chen thought he was witnessing a beautiful act of altruism, but it didn't take him long to see that it was something else.

After a few more strokes, the saver entered his cagemate.

The intercourse lasted exactly eight seconds.

After the act was over, the cappuccino he had charged in exchange for sexual favors used the received disk to buy expensive grapes.

It was the first scientifically documented case of animal prostitution.

Chen (who years later used his experiences with the capuchins in part to set Uber's fare policy) decided that the apes could go further.

He and Santos taught them to bet.

They were entering unknown territory.

The capuchins soon began to enjoy the game when they won coins and to despair when they lost them.

The economist armed himself with a mountain of data on stock market movements on Wall Street and compared that data with the behavior of the capuchins.

"What they did," Chen later declared, "was statistically indistinguishable from what humans do who invest in the stock market."

In both cases, that of the apes and that of humans, greed and panic rule.

Greed when you win and panic when you lose.

Even if the gain is more than the loss.

Investors in Spanish banks have gained 50% in a few months.

Spanish banks beat all the marks in terms of profits in 2022.

But as soon as a bank in California failed, they panicked.

Not only the Spanish, because in this there are no national distinctions: all capuchin monkeys.

Well, not all.

The human equivalents of the saver monkey (the one who paid for sex with his monetary surplus) and the thief monkey will be taking advantage of the stock market declines to buy cheap shares, or to continue granting expensive credits, or to invent a financial product that no one will understand and with the one they will cover until the next crisis.

Nature is wise.

And there are very smart guys.

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Source: elparis

All news articles on 2023-03-25

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