Theoretical ReconciliationUltimately, I find that neoclassical economic views and behavioral economics are not necessarily incompatible with each other. Rather, I view them as compatible theories because they actually describe the same basic principles. The neoclassical view says that no one is better placed than anyone else to make financial decisions, everyone wants the same thing and is equally informed. The behavioral view holds that everyone is equally inferior in making investment decisions due to social, cognitive, and emotional factors that inhibit everyone's ability to make accurate decisions. The market always acts the way it does, regardless of how it is actually derived. Neoclassical and psychological theories should therefore be integrated to provide better understanding and essentially return to a state of equilibrium, similar to where they were originally found. behavior of humans, it would however seem that finding a solution is difficult under such theoretical conditions; that would be further from the case. If one examines the undesirable aspects of Wall Street, specifically referring to excessive risk, volatility, and overconfidence as causes of instability, there are fairly readily available solutions to address these issues. The extent to which risk, volatility and overconfidence are cyclical in nature and contribute to the creation of economic bubbles has been clearly studied and quantified. Examining monthly stock market and trading volume over forty years shows that higher trading volume follows months with higher returns (Statman et al., 2006). This inevitably causes overconfidence...... middle of paper ......F. Norris (April 29, 2000) “Another technological casualty; Fund manager Soros says he 'overplayed' his hand » NY TimesMr. H. Bouchet and R. Isaak (November 29, 2011) Is the Financial Crisis a Male Syndrome: Bloomberg business week taken from http://www.businessweek.com/europe/is-the-financial-crisis-a-male-syndrome -11292011.htmlMr. Statman, S. Thorely and K. Vorink, (2006) Investor overconfidence and trading volume: a review of financial studies 19By L. Leite (June 1, 2007) The (white) male-dominated world of finance? CBS Money Watch retrieved from http://www.cbsnews.com/8301-505125_162-28040266/the-white-male-dominate-world-of-finance/Vatican calls for creation of “World Central Bank” Copyright 2011 Thomson Reuters retrieved from http://www.cnbc.com/id/45013499/Vatican_Calls_for_Central_World_Bank_to_Be_Set_Upoccupywallst.orgwww.grameen-info.org