Batter up: Traders might benefit from testosterone boost
Baseball players have drawn much controversy for taking anabolic steroids — synthetic derivatives of the hormone testosterone — to juice their home-run hitting ability. Maybe day traders will be next.
A recent study by the University of Cambridge in England says the hormone that drives male aggression and sexual interest may also aid short-term success at investing.
After measuring levels of testosterone among financial traders in London, the researchers found those with higher levels in the morning were more likely to make a big profit that day. But it comes at a price: High testosterone levels over several days also can lead to irrational risk taking, according to the study.
Bankruptcy a-go-go
Since January, which industry has had the most public companies file for bankruptcy protection? No, it’s not the airlines. It’s telecommunications, with five filings, according to .
The manufacturing sector has had four, and automotive and oil and gas have each had three. The airline industry has had several high-profile bankruptcy filings recently, including that of Frontier Airlines, but many were by private companies, such as ATA Airlines.
When companies file for Chapter 11, they reorganize under a court’s protection. After restructuring, they often emerge as stronger companies. But their stockholders typically lose their entire investment, as the old shares get canceled and new stock goes to creditors.
Hawks flying high
The inflation hawks on the Federal Reserve — those members more worried about rising prices than a weakening economy — may be getting more ammunition, which could lead to a pause in rate cutting.
The Fed has been slashing the target for its benchmark interest rates in hopes of encouraging lending and boosting the economy. But the moves also tend to boost prices, a phenomenon consumers are all too familiar with every time they fill up the gas tank or head to the grocery store.
Through the first three months of the year, wholesale prices for finished goods are up 10.2 percent on an annualized basis from last year’s first quarter. A 5 percent jump in “core” wholesale inflation, which excludes volatile food and gasoline, offers “supportive ammunition for the hawks,” says Northern trust associate economist Bryan Crowe.
Merrill Lynch economist David Rosenberg also says it may make sense for the Fed to pause until at least August to see whether tax rebates going out to Americans in early May will actually boost spending.
The Associated Press
