Is the market on prozac ?

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From: Udhay Shankar N (
Date: Sun Apr 16 2000 - 23:21:03 PDT

Finally. An interesting new take on the mania.


The Third Culture
Randolph M. Nesse, M.D.

  Is the Market on Prozac?

  The press has been preoccupied with possible explanations
  for the current extraordinary boom. Many articles say, as they
  always do while a bubble grows, that this market is "different."
  Some attribute the difference to new information technology.
  Others credit changes in foreign trade, or the baby boomer's
  lack of experience with a real economic depression. But you
  never see a serious story about the possibility that this market
  is different because investor's brains are different. There is
  good reason to suspect that they are.

  Prescriptions for psychoactive drugs have increased from 131
  million in 1988 to 233 million in 1998, with nearly 10 million
  prescriptions filled last year for Prozac alone. The market for
  antidepressants in the USA is now $6.3 billion per year.
  Additional huge numbers of people use herbs to influence their
  moods. I cannot find solid data on how many people in the
  USA take antidepressants, but a calculation based on sales
  suggests a rough estimate of 20 million.

  What percent of brokers, dealers, and investors are taking
  antidepressant drugs? Wealthy, stressed urbanites are
  especially likely to use them. I would not be surprised to learn
  that one in four large investors has used some kind of
  mood-altering drug. What effects do these drugs have on
  investment behavior? We don't know. A 1998 study by Brian
  Knutson and colleagues found that the serotonin specific
  antidepressant paroxetine (Paxil) did not cause euphoria in
  normal people, but did block negative affects like fear and
  sadness. From seeing many patients who take such agents, I
  know that some experience only improved mood, often a
  miraculous and even life-saving change. Others, however,
  report that they become far less cautious than they were
  before, worrying too little about real dangers. This is exactly
  the mind-set of many current investors.

  Human nature has always given rise to booms and bubbles,
  followed by crashes and depressions. But if investor caution is
  being inhibited by psychotropic drugs, bubbles could grow
  larger than usual before they pop, with potentially catastrophic
  economic and political consequences. If chemicals are
  inhibiting normal caution in any substantial fraction of
  investors, we need to know about it. A more positive
  interpretation is also easy to envision. If 20 million workers are
  more engaged and effective, to say nothing of showing up for
  work more regularly, that is a dramatic tonic for the economy.
  There is every reason to think that many workers and their
  employers are gaining such benefits. Whether the overall
  mental health of the populace is improving remains an open
  question, however. Overall rates of depression seem stable or
  increasing in most technological countries, and the suicide
  rate is stubbornly unchanged despite all the new efforts to
  recognize and treat depression.

  The social effects of psychotropic medications is the
  unreported story of our time. These effects may be small, but
  they may be large, with the potential for social catastrophe or
  positive transformation. I make no claim to know which
  position is correct, but I do know that the question is important,
  unstudied, and in need of careful research. What government
  agency is responsible for ensuring that such investigations get
  carried out? The National Institute of Mental Health? The
  Securities and Exchange Commission? Thoughtful
  investigative reporting can give us preliminary answers that
  should help to focus attention on the social effects of
  psychotropic medications.

  Randoph M. Nesse, M.D., is Professor of Psychiatry, Director,
  ISR Evolution and Human Adaptation Program, The University
  of Michigan and coauthor (with George C. Williams) of Why
  We Get Sick: The New Science of Darwinian Medicine.

  LINK: Randolph Nesse Home Page

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