Are You a Financial Psychopath?

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AnalystForum's picture

Business Insider has an article discussing research in the March/April issue of CFA Magazine called The Financial Psychopath Next Door by Sherree DeCovny. 

“Studies conducted by Canadian forensic psychologist Robert Hare indicate that about 1 percent of the general population can be categorized as psychopathic, but the prevalence rate in the financial services industry is 10 percent. And Christopher Bayer believes, based on his experience, that the rate is higher.”

How many people do you know who fit this description?

“These “financial psychopaths” generally lack empathy and interest in what other people feel or think. At the same time, they display an abundance of charm, charisma, intelligence, credentials, an unparalleled capacity for lying, fabrication, adn manipulation, and a drive for thrill seeking.

A financial psychopath can present as a perfect well-rounded job candidate, CEO, manager, co-worker, and team member because their destructive characteristics are practically invisible. They flourish in fast-paced industries and are experts in taking advantage of company systems and processes as well as exploiting communication weaknesses and promoting interpersonal conflicts.”

Do you think there are 10x the psychopaths in finance as the rest of the population?

ohai's picture

Sounds like just “shock and awe” publicity for the author. Of course, the description is rather broad, so it’s not hard to imagine that 1/10 people could arguably fall under this category. 

“Be aware of this 40 year old men in our country.They suffer from mid life crisis and are always trying to be in the good books of young girls.” -Rahul Roy

bchad's picture

I agree with the author’s assessment.  Having worked both outside of finance and inside, finance does attract psychopaths (though I generally used the term sociopaths).  Government also attracts them, BTW, but not to quite the same extent.

There are very understandable reasons why this might be so.

1)  Supply of psychopaths in the financial labor force:  People who have boundary issues (i.e. don’t respect social boundaries), lack of empathy, shallow relationships, *and* who love money, come to the industry in search of dough.  Obviously others like money too, but these guys are willing to throw their grandmothers under a train to get there, and more normal people aren’t.  And the presence of these people scare off more normal types.

2) Demand for psychopaths in the financial industry:  Having these sorts of people can be very useful in finance, particularly in chop-shops or equity sales teams.  From a company point of view, it’s useful to have someone that will ignore their family to get work done, be obsessive-compulsive about their due diligence, hammer on someone to buy some worthless IPO stock when most normal people would have accepted “no” for an answer.

3)  Hand people a lot of money for whatever they do, and they figure that they should do more of it.  So people who are mildly psycho/sociopathic get those behaviors reinforced, figuring - hey, I got the money - treating you like *crap* is how I got it, so clearly it’s the best way for me to act.  In some ways, I think this attitude (real or percieved) is what really drove the Occupy movement more than anything else.

You want a quote?  Haven’t I written enough already???

Inner Evil Voice's picture

That’s right, Psycopathy is an outdated term in the DSM IV. It’s often used in movies, Discovery Channel, and articles like this one. There are lots of variables but usually Sociopathy means your brain is not wired to give a shit about anybody else. The type of sociopathy you actually become would roughly go like that:

Sociopath + abused in childhood = serial killer -> gets life or death row -> Discovery Channel

Sociopath + dumb = dumb crimes -> time in the big house -> Local news Channel

Sociopath + very smart = shitton of money -> Bloomberg Channel

And obviously endless combinations in between.

bchad's picture

Love your path analysis there, IEV.

You want a quote?  Haven’t I written enough already???

Palantir's picture

This sounds pretty badass honestly.


“These “financial psychopaths” generally lack empathy and interest in what other people feel or think. At the same time, they display an abundance of charm, charisma, intelligence, credentials, an unparalleled capacity for lying, fabrication, adn manipulation, and a drive for thrill seeking.

Cities teem with evil and decay, let’s give it a good shake and see what falls out!!

Black Swan's picture

^ agreed, plantir.

This stuff always worries me, because it really makes me wonder.

redacted

FrankArabia's picture

complete rubbish….

Sweep the Leg's picture

Many of the X Games athletes also have sociopathic tendencies.  IEV is dead on.  More about how those characteristics are nurtured than the actual traits. 

For further reference, the nature vs nuture debate was solved in the documentary Trading Places

jmh530's picture

You would think they would also do a test of lawyers or members of Congress.

frankz888's picture

“These “financial psychopaths” generally lack empathy and interest in what other people feel or think. At the same time, they display an abundance of charm, charisma, intelligence, credentials, an unparalleled capacity for lying, fabrication, adn manipulation, and a drive for thrill seeking.

did the article really have a spelling error?

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