Ignore the Financial Media
September 17, 2019
The financial media is omnipresent. Whether it’s hearing about what the Dow did today on your drive home or a talking head pontificating about how the markets are obviously about to tank, we are constantly immersed in a miasma of prognostication.
Everyone has a take on what the markets will do next and what you should do about it now. Whether that take has any relation to reality or not doesn’t seem to have much relevance. And unlike pre-game shows, no one is keeping track of how their analyst's picks have done throughout the season.
What are the financial media’s incentives? Not to put too fine a point on it, but they are there to make money. They do this by monetizing your attention. The vast majority do this by selling ads (of one form or another), though some still use a traditional subscription model on top of (or sometimes in place of) the ads. Essentially, if you aren’t paying attention, they aren’t making money. To a very large degree, you are the product.
The goal here is not to give you bad information. The goal is to keep you around for the ads. The vast majority of reporters want to try and help their readers and viewers, but their incentives make it hard to do that.
For a lengthy but very informative discussion of why you might want to ignore most of what you see and hear in the financial media, read this article.