What caused the crunch ? Men and testosterone

From The Times
September 30, 2008
http://women.timesonline.co.uk/tol/life_and_style
What caused the crunch? Men and testosterone

Never mind mortgage-backed securities - the reason why confidence in the banking system collapsed was too much testosterone. With more women on the trading floor, risk-taking would be a saner business

True to form, economists have offered a range of explanations for the financial crisis that threatens the world and which so few of them managed to predict. Some blame something called collateralisation, others easy money, still others lax regulation.

But, by focusing on the technicalities, have they overlooked a more obvious culprit - men?

After all, it is men who dominate the financial system that got us into this mess; it is men, by and large, whose trading inflated the profits of banks to levels that now seem like the stuff of testosterone-fuelled fantasy; and it is men who pocketed most of the bulging bonuses that even Gordon Brown reckons were a key cause of the crisis. All of which raises an important and deliciously controversial question: what would have happened if global financial institutions had been run by women?

Would they have been more focused on the human consequences and less on the next pay cheque? Would they have been more empathetic and less cut-throat? Would financial districts have had a few more crèches and a few less of those godawful bars where traders hang out to brag about their latest deal? In short, would we have avoided this calamity if markets had been doused with sufficient quantities of oestrogen?

Julia Noakes, a psychologist working with City high-achievers, is in little doubt. “The problem in finance is that there is too much thrusting individualism and not enough femininity,” she says. “A lot of women are deterred from striving for senior management positions because they don't want to deny 50 per cent of their personalities.” Heather McGregor, a City headhunter, echoes this analysis with the arch observation that “the UK bank that has come out of the current crisis strongest is the one that has most aggressively promoted women into positions of senior management: Lloyds TSB”.

But this is dismissed as stereotyped claptrap by other financial leaders. One senior banker summarised the views of several managers and traders to whom I spoke when he said: “If women ran the City it would have made no difference, and it is sexist to suggest otherwise. Sure, mistakes have been made, but are you saying that women would have walked away from the huge profits being dangled in front of us? Get serious.”

So, who is right? ...