A spate of banker suicides or a spate of reports on banker suicides?

e13-iconTrends are easy to spot when you go looking for them and conspiracy theorists are trend-spotters par excellence. The trouble is, a lot of these trends only exist in the eye of the beholder.

Following a “spate” of recent suicides among investment bankers — a possible early warning sign of another financial crisis — John Aziz asks:

[I]s it really abnormal for the finance industry to experience seven possible suicides in the space of a month?

Let’s do a back-of-an-envelope calculation. The U.S. has a suicide rate of about 12 people per 100,000 per year. Roughly 5.9 million people are employed in the American financial sector. Assuming the industry has the same suicide rate as the rest of the population — even with higher-than-average stress levels — one would expect 708 suicides in any given year, or nearly 60 per month in the U.S. alone.

Given that just three of the seven incidents (some of which may not have been suicides) occurred in the U.S., this suggests that the number is not excessive or unusual. Seven hundred suicides perhaps would be cause for raising eyebrows. Not seven.

So this “trend” is more of a case of bloggers and writers conspiracy-mongering without looking properly at the evidence.

The idea that suicides on Wall Street provide a metric for accessing the health of the economy can be traced back to the 1920s, but then as now, it turned out to be an urban legend:

Tall tales about panicked speculators leaping to their deaths have become part of the popular lore about the Great Crash. But although jumping from bridges or buildings was the second-most-popular form of suicide in New York between 1921 and 1931, the “crash-related jumping epidemic” is just a myth. Between Black Thursday and the end of 1929, only four of the 100 suicides and suicide attempts reported in the New York Times were plunges linked to the crash, and only two took place on Wall Street.

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