It is your must read today.
Its this simple: News is old. Except for true surprises, its already in price by the time it hits the press.
Ben breaks down issues of news consumption into 5 problematic categories:
1. Markets don’t care who the president is.
2. Expectations matter more than the news itself.
3. The flow of information is mind-boggling.
4. We are pattern seeking creatures.
5. The economy is still humming along.
Note that the first four are always true; only the economic discussion is specific to today.
I love the chart (via BofA Merrill Lynch) showing a breakdown of scary headlines — despite this, we are back at all-time highs yet again.
Source: BofA Merrill Lynch via Wealth of Common Sense
Lose the News (June 16, 2005)