Jason Zweig of the Wall Street Journal highlights the effects of surprises on investor psychology, drawing on neuroscience and historical events back to the 18th century. Robert Shiller of Yale says, “Metaphors and stories are important in investors’ thinking, and they can become a self-fulfilling prophecy,” noting that such stories are adjusted partly “by the almost instinctive urge to look at others’ emotions.” The journal notes that “all investors have a narrative in their head . . . the simpler that story is, the more likely you are to feel in control and the more confident you will be that your investment decisions are sound.” It is when something conflicts with the story “that can lead to a sudden fear of the unknown.” Neuroscience has shown that specialized brain cells “respond to unexpected outcomes in as little as three-tenths of a second, firing out warning signals.” The psychological impacts of surprise help to explain rapid shifts in markets, all the way back to the 18th century when the London, Paris, and Amsterdam markets “levitated together and then crashed in lockstep.” As a current example, Zweig highlights potential impacts of recent indications that Chinese economic policy is not as infallible as it may have once seemed.