Lecture 8 - Human Foibles, Fraud, Manipulation, and Regulation
recorded by: Yale University
published: Oct. 7, 2009, recorded: March 2008, views: 3331
released under terms of: Creative Commons Attribution No Derivatives (CC-BY-ND)
Report a problem or upload filesIf you have found a problem with this lecture or would like to send us extra material, articles, exercises, etc., please use our ticket system to describe your request and upload the data.
Enter your e-mail into the 'Cc' field, and we will keep you updated with your request's status.
Regulation of financial and securities markets is intended to protect investors while still enabling them to make personal investment decisions. Psychological phenomena, such as magical thinking, overconfidence, and representativeness heuristic can cause deviations from rational behavior and distort financial decision-making. However, regulation and regulatory bodies, such as the SEC, FDIC, and SIPC, most of which were created just after the Great Depression, are intended to help prevent the manipulation of investors' psychological foibles and maintain trust in the markets so that a broad spectrum of investors will continue to participate.
- Robert Shiller, Irrational Exuberance, chapters 5, 6 and 7
- Fabozzi et al. Foundations of Financial Markets and Institutions, chapter 1 (pp. 12-16)
- Louis Brandeis, Other People's Money and How the Bankers Use It, chapter 5 (pp. 92-108)
- William Douglas, Democracy and Finance, chapter 1 (pp. 5-17)
Link this pageWould you like to put a link to this lecture on your homepage?
Go ahead! Copy the HTML snippet !