My Sunday Washington Post Business Section column is out. This morning, we look at how the internet evolved as a source of bad investment opinion.
The print version had the full headline How to sort out the garbage of online investment advice; I like the online version hed, Hey, investment cranks: The Internet never forgets.
Here’s an excerpt from the column:
“As Theodore Sturgeon famously observed, 90 percent of science fiction is crap, but then again 90 percent of everything is crap.
In the world of online investment opinions, Sturgeon was an optimist.
Not all that long ago, the perspectives of individual amateur investors and professional ones, too, were for the most part unknown. Most market participants had no way to share their views about individual companies, interest rates, the economy, Federal Reserve policy or much of anything else. They owned whatever investments they owned, stocks and interest rates went up and down, and that was the end of it.”
The concept is pretty self-explanatory. We move through message boards, blogs, social media and then onto the really bad forecasters. You will find it to be both informative and amusing.
Source:
Hey, investment cranks: The Internet never forgets
Barry Ritholtz
Washington Post, August 1 2015
http://wapo.st/1SSLF0T
I’ve spent a lot of time the past 40 years trying to shield people from bad advice.
If anything you are too soft on this.
Forget online, have you seen the endless stream of touts & ignoramuses on CNBC? I’d stick a dental drill in my eye before I’d suffer through 10 seconds of Joe Kernan or Rick Santelli. The level of stupid surpasses anything found on the internet.
I don’t watch anything related to the markets or the economy on TV. Sturgeon’s Law is wildly optimistic when it comes to financial and economic reporting on TV.
read everything at the Bogleheads forum
If these geniuses really had unique insight, they would keep their mouths shut, cash in on their wisdom, and retire to Bermuda.
Even if the large and looming boomer demographic with underfunded retirement accounts finds “perfect” efficient market hypothesis style diversified portfolios or indexed portfolios (from the likes of Swedroe, Robo advisors, Bogle, and alike) then there will still be a continuing crisis, as investors with stagnant salaries will still be behind in asset accumulation. Boomers will need 10+% returns for a sustainable retirement, health expenses, and a consumer lifestyle to which they have become accustomed, vs. the 6 – 8% types of typical returns that these EMH portfolios have produced. Low fee vehicles and “saving” can help, but not in a meta fashion.
Would you prefer a gatekeeper who ALLOWED you to read what he thought was acceptable? The problem is not the bloggers and blabbers but readers that have little to bad judgement and hardly use their brains. Be happy there are enough writers that smart people must choose who to listen to. That provides an edge.