easily to compare prices with fundamentals. but it also tests the patience of the untested investor subject to regular performance evaluation. investors whose judgement is right, but whose timing is wrong, stand an increasingly high chance of exiting the game. more frequent information on performance risks contaminating the gene pool, driving out the patient to the benefit of the impatient. anecdotally at least, performance evaluation intervals have progressively shortened. over recent decades, companies have migrated from annual general meetings, to a six monthly or quarterly reporting cycle to today ’ s steady stream of within - cycle trading updates. in finance, information is in general a good thing. but in finance, as in life, it is possible to have too much of a good thing. liquidity is similarly double - edged. it reduces the impact of momentum trading on prices, thereby increasing market efficiency. but it also reduces the costs of pursuing such strategies. in other words, liquidity unlocks the impatience gene. investors whose judgement is wrong, but whose timing is right, can lock in immediate gains. liquidity, too, can pollute the gene pool by allowing the impatient to prosper. like information, liquidity can be too much of a good thing. 24 so we have pitchfork equilibrium : along one prong virtue, along the other vice. as in other social systems, these two financial equilibria have neurological roots and sociological branches. they yield, however, very different economic fruit. this dual - self world is structurally schizophrenic : financial innovation is both good and bad ; information is both solution and problem ; liquidity is both cure and curse ; investors are both abstemious and addicts. chen ( 1995 ). bernholz ( 1997 ). for example, laibson ( 1997 ). so which evolutionary gene is dominating finance in practice? is bad money driving out good or the reverse? is history repeating itself as the yuan or the ming dynasties? patience in finance there is ample evidence, theoretical and empirical, of self - improving financial cycles. from the medici banks in italy in the 13th century to the joint stock banks of he 19th century to the explosion of capital market finance in the latter part of the 20th century. today, china provides no better example of that self - improving cycle in motion. but can financial systems overshoot onto the impatient path, where too much liquidity and information unlock the impatience gene and its ugly progeny. along that path lies excess – excess trading

ordinary economic development, especially over the past 400 years. and the timing of that development has a neurological link. between 1 million bc and 50, 000 bc, world gdp per capita was roughly unchanged. by the end of that period, neanderthal man had gone the way of the dinosaurs. inside our skulls, patience and the pre - frontal cortex became, literally and metaphorically, front and centre. in the subsequent period, patience brought prosperity. between 50, 000 bc and 1000 ad, world gdp per capita rose around 50 %, at an annual growth rate of 0. 00072 %. economists today would classify that as anaemic. but, at the time, it must have felt like a golden age. in the subsequent millennium, world gdp per capita has risen 50 - fold, at an annual growth rate of around 0. 4 %. much of that growth has been since 1750 ad, since when world gdp per capita has risen almost 37 - fold, at an annual growth rate of 1. 4 % per annum. 3 it is difficult to imagine patience not having hastened this dramatic journey. some studies have drawn a more explicit link between patience and growth. studies have linked various cultural and religious characteristics to growth. 4 for example, it has been for example, stevens et al ( 2005 ), although rosati et al ( 2007 ) argue that, when making food choices, chimpanzees and bonobos exhibit greater patience than humans. figner et al ( 2010 ). delong ( 1998 ). barro and mccleary ( 2003 ). argued that pre - dominantly protestant countries in europe grew faster than catholic countries as a result of differences in patience and work ethic. 5 this has echoes with recent literature emphasising the role of “ asian values ”, such as thrift and patience, as a driver of growth in the region. 6 patience is also likely to have been a key factor in the evolution of financial systems. at root, banks and capital markets are simply a means of matching saving to investment. they are about realising the benefits of patience and thus growth. there is strong evidence for such effects. financial deepening is known to be an important determinant of long - run growth. 7 why? efficient financial intermediation increases the returns to patience, thereby encouraging thrift and promoting growth. the impatience “ gene ” for every virtue there is a vice, for every ego an alter ego. so it is with patience.