4 Taming animal spirits
We find strong empirical support in favour of a geomagnetic-storm effect in stock returns … Unusually high levels of geomagnetic activity have a negative, statistically and economically significant effect on the following week’s stock returns for all US stock market indices.
— Krivelyova & Robotti, (2003, p. 1)
In 2002, former US Secretary of State Donald Rumsfeld (2002) stated that ‘there are known knowns … There are known unknowns … But there are also unknown unknowns’.
Up to this point, the reader has been taken on a journey through a lot of known–unknowns. Before opening the pages of this book, for example, a trader may have known that his physiology plays a role in shaping his trading preferences, but he is unlikely ...
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