This is kind of scary but it’s accurate.
Every 60 seconds, the following information happens:
To recap: every 60 seconds…
- 65,000 photos get uploaded into Instagram
- 350,000 tweets are sent
- 3,800,000 Google searches are run
- 156,000,000 e-mails are sent
With all this information going on at one time:
How are you supposed to focus on investing for the long term when the fire hose of media content is constantly blasting you in the face?
Are you sure what you just read on (name any website) is accurate and something you should act on?
How can you be sure what (name any news anchor) said on (name any TV channel) is something relevant to you?
Is there a better way you could be spending your time to further your progression towards (enter any goal or ambition)?
These are honest questions to ask yourself. Are you able to spare enough time in any given week to learn about your investments, 401k plans, insurance, student loans, buying a car, buying a home, or any other personal finance topics?
Today, it’s almost impossible to find the time when you are overloaded with hours of YouTube videos to watch, millions of Facebook and Instagram posts to read, dozens of new Netflix shows, and years of useless information to search on Google. The other downside is, with information overload you tend to want to make quick decisions when concerning news smacks you right in the face.
The best thing that technology has done for the world is provide us almost instant access to information. However, the worst that technology has done for the world is provide us almost instant access to information.
In Scott Galloway’s book, The Four, he talks about the focus of major tech players in today’s economy and how they impact our lives:
- Google targets your brain; your thirst for information
- Facebook targets your heart; your need for empathy and meaningful relationships
- Amazon targets your gut; your hunter-gatherer instincts
- Apple targets your desire; your urge for luxury and status
Professor Galloway explains in the book how each of these tech titans has breached into our daily lives and created almost an addiction to their products. We then spend countless hours throughout these various media properties and are overwhelmed with content. As “The Four” try to control our attention, so does every other media property on the planet.
The reason I bring up information overload is the fact that most people begin to question their investment plans, stall any progress towards their life goals, and increase their stress levels based upon news. Our brain tries to process what is going on but is inundated with too much content. Don’t worry, you cant escape it. Change the channel and there lies another info-graphic of how terrible the world is.
Here’s an example:
Source: April 4th, 2018 – money.cnn.com post
This was the story that everyone woke up to on Wednesday, April 4th. The stock market was down about 600 points before the markets opened and people were literally losing their minds. Queue the media screaming “Trade War.” Before 8AM, I already had dozens of e-mails from concerned clients.
Now, fast forward to the market close that day and we see the following:
If you slept through the entire day you would have had no idea the volatility even happened. But you have to remember that media properties rely heavily on advertising revenue. To get advertising revenue, you need to have a lot of eyes watching your content. To get a lot of eyes watching your content, you need to have loud, entertaining and sometimes scary content.
To further prove this, I have began to archive daily news headlines. I am tracking all of this under the “Noise” section in the menu at the top of my website. My goal is to help highlight how periods of market volatility are a lot of times related to news. How you react and make decisions during these time periods will really dictate how well you stick to the plans you set to reach your goals. After a few months, when the volatility has subsided, most people will totally have forgotten any of this actually happened. Here is a snapshot of this month:
Source: Random News Article Headlines from Multiple Media Sources
I would bet if you set a calendar reminder for December 2018, you probably will have forgotten that tariffs were an actual concern during the year. Disagree? Well, can you remember the last time we saw severe market volatility based on the US debt being downgraded? The answer….2011.
You goal should be to remove the stress from your investments and simply take a breather from the media every once in a while. You should instead spend your time learning about areas of your future that are more relevant than today’s daily news. What can you do today to further learn about your 401k, buying/selling a home, or how to get started investing. When it comes to investing in the stock market, you need to focus on the content that actually matters. Most news outlets just summarize all analyst opinions on the market and aggregate them. I would emphasize you focus on how business leaders (ie: CEO’s, CFO’s, COO’s) are describing their own outlook for their business before agreeing with the news. Various economic leaders can also be a good place to get information but again, do it sparingly. Most companies report their earnings quarterly and a CEO normally writes a shareholder letter annually. There is a good reason they don’t give you this information daily…its just not important over short periods of time.
I would also suggest avoiding daily monitoring of your investments. Looking at your accounts daily is basically like checking your Zillow Zestimate on your home everyday. You know it will change over time but the minute by minute monitoring is ridiculous. The same thing happens with financial news outlets show a “tick by tick” play of a stock. The longer you can go without monitoring your investments, the smoother the ride becomes.
Taking time to focus on other aspects of your life will keep your stress levels contained and avoid derailing your future self. You have enough media fighting over your attention, so spend your time wisely!