How Investors Use Stories to Tame Uncertainty

If you want to understand how fund managers choose a portfolio, why not ask them? That’s what David Tuckett does: he draws on standard sociological techniques of interviewing to understand investors’ decisions to buy or sell assets. He says financial markets cannot be driven by economic fundamentals — because the future is uncertain — instead, they are driven by stories about fundamentals. David Tuckett merges insights from Keynes, from sociology, and from psychoanalysis to develop what he calls emotional finance — this is new economic thinking.