Dr. John Haracz Seminar on Jan 9, 2020: “Resolving the Complexity of asset-price bubbles: Neuroimaging and digital technology for the prediction and prevention of major bubbles”

Seminar: “Resolving the Complexity of asset-price bubbles: Neuroimaging and digital technology for the prediction and prevention of major bubbles”
Who: John Haracz, MD, PhD, MPH
When: 4:30pm – 6pm Thursday, Jan 9, 2020
Where: LKSC 130 (Stanford Medical School)

Abstract: A variety of natural complex systems can become metastable and show phase transitions arising from system components switching from one state to another. Turing Fellow Tobias Preis and colleagues proposed that scale-free power-law dynamics of stock-market price fluctuations and transaction volumes, on time scales ranging from tens of milliseconds to hundreds of days, may be generated by interacting traders switching their preferences for buying or selling stocks (Preis et al., PNAS, 2011). The authors noted that the Global Financial Crisis (GFC) may be a large representative of such financial-market fluctuations. Investor psychology is an increasingly recognized driver of asset-price bubbles, such as the stock- and housing-market bubbles preceding the GFC. The present discussion will assess the potential of using either neuroimaging or digital technology, namely web analytics of investors’ behavioral interactions with an online asset-trading platform, to achieve an early-warning signal of emerging bubble-driving psychology (i.e., investors switching from deliberation- to herding-based trading). This warning signal could enable the prevention of major asset-price bubbles by feeding back to investors the neuroimaging or behavioral sign of a developing bubble. This feedback could discourage herding-based asset purchases, thereby enabling a self-regulatory mechanism for cooling off overheated asset markets. The feedback would represent an introduction into asset markets of a potentially stabilizing negative feedback loop, analogous to the many equilibrium-oriented negative feedback systems in physiology. The broad goal of this research is to stabilize financial systems by inducing equilibria that are potentially as sustainable as the equilibria of physiology.

Working Paper: https://ssrn.com/abstract=336652

2 Responses to “Dr. John Haracz Seminar on Jan 9, 2020: “Resolving the Complexity of asset-price bubbles: Neuroimaging and digital technology for the prediction and prevention of major bubbles””

  1. دانلود آهنگ های پرطرفدار جدید Says:

    Thanks
    very good

  2. پویا صنعت Says:

    The article was practical and appropriate

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