Selfie Deaths Are Like Market Crashes
Investors should worry much more about excessive fees, which are the financial equivalent of high cholesterol – something that might kill you.
Bloomberg, April 22, 2019
Every now and again, a data point floats by that screams out for rebuttal. Such was the case last week when Outside magazine discussed “the epidemic behind selfie deaths.” The term “epidemic” seems to be rather exaggerated, as the total fatality rate was 259 people over the 7 years between 2011 and 2017, inclusive.
That sounds like a lot, until you consider how many smartphones are sold each year and how many selfies are taken every day (See the dat here: “Epidemic of Selfie Deaths”).
This sort of innumeracy is far more common than most people realize. We often see similar Denominator Blindness in investors, who can be easily persuaded any particular asset may be extremely attractive or too pricey via a similar lack of context.
Whether or not these deaths are “catastrophically bad judgment” as some described them is irrelevant. What they are is inevitable statistical outliers.
Hence, today’s discussion combines the two: Why boring and mundane is so much more dangerous than the splashy and dramatic — and why this matters for both selfie takers and investors . . .
Continues at Selfie Deaths Are Like Market Crashes.
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I originally published this at Bloomberg, April 22, 2019. All of my Bloomberg columns can be found here and here.
Previously:
“Epidemic of Selfie Deaths” (April 18, 2019)
Don’t Suffer From Denominator Blindness (October 14, 2015)
The Plural of Anecdote IS Data (February 4, 2019)
Denominator Blindness, Shark Attack edition (February 5, 2019)
Morningstar: Crashes & Terrorists & Sharks, Oh, My! (September 8, 2017)
