NEWS!

[CWO3ROBBIE]

Here is an article that was in one of the investment letters that I sometimes read. It makes a lot of sense.

Do you agree or dissagree?

Do you suffer from information overload? I know that I sometimes do.

By Nick Hodge | Friday, April 6th, 2012

There is such a thing as information overload.

And in this high-speed digital age, I think we're all affected by it in some way.

On more than a few occasions lately, I've heard this sentiment echoed in various ways...

The first came from an essay simply titled “Avoid News” by Rolf Dobelli, a Swiss novelist and entrepreneur who also has a show on Bloomberg in Germany.

His take is that “news is to the mind what sugar is to the body.”

By trying to consume so many fleeting headlines we get distracted, stifle critical thinking, and fill ourselves with anxiety and despair.

Oakland shooting. Treyvon Martin. Tornadoes. Syria. Iran. Obamacare. Primaries. Debates. GDP. Unemployment. And on. And on. And on.

News today is meant to generate a click on a website — not to inform you of the nuances of the situations, dive into the backstories, or deliver hard-hitting follow-ups.

And in most cases, none of the “news” has a direct impact on your life, your decision-making, or your bottom line.

I'd submit it's not even news; it's hyped-up sideshow stuff needed to fill the space created by a 24-hour news cycle and pay-per-click advertising.

Pope Visits Communist Cuba.

That doesn't impact my existence — and frankly, I don't care.

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Missing Something

Don't worry about missing something, Dobelli says.

If something truly noteworthy happens, you'll hear about it.

But most of the time, there isn't anything to miss.

The important stuff is the causation, the way different stories are related, and the way events touch our lives independently.

And you aren't getting that from a staff writer at the Associated Press or from the middle-aged women wearing too much makeup who warn you about the one thing in your pantry that could kill you, but  won't tell you more until you tune it at 11 to watch the advertisements.

What's worse, instead of just reporting, they try to rationalize and justify...

Oil Down on Inventories. Oil Up on Jobless Claims. Oil Flat on Retail Sales.

Give me a break. If they knew why oil was up or down, they wouldn't be writing news stories for $40k a year. They have an undergrad degree in journalism, not quite the market intuition of a billionaire fund manager.

As Dobelli says, “Any journalist who writes, 'The market moved because of X' or 'The company went bankrupt because of Y' is an idiot.”

He recommends abandoning newspapers, the evening news, news websites, and news apps, and instead reading long-form essays, editorials, and books.

The purpose of “news” in the modern era is to sound urgent and important. Most of it is not.

Evidence

Cook County Hospital in Chicago is the basis for the hit TV show ER.

In the late 1990s, it started changing the way it diagnosed heart attacks...

Instead of considering all factors — age, medical history, smoking, exercise, etc. — and then allowing the doctor to make a diagnosis, the hospital  decided to look at only four factors: the ECG, presence of angina, fluid in lungs, and blood pressure.

It didn't matter if the patient was a 60-year-old pack-a-day smoker or a 25-year-old long-distance runner.

Then the hospital did a two-year test. Part of the time doctors tried to diagnose heart attacks on their own using all available information; part of the time they would look only at the four factors I described above.

You can probably guess who won by the point of this article...

Doctors got it right between 79% and 89% of the time.

The four factors got it right more than 95% of the time.

Here's Malcolm Gladwell, who wrote about this event in his book Blink:

Why is the Cook County experiment so important? Because we take it, as a given, that the more information decision makers have, the better off they are. If the specialist we are seeing says she needs to do more tests or examine us in more detail, few of us think that's a bad idea... All that extra information isn't actually an advantage at all... in fact, you need to know very little to find the underlying signature of a complex phenomenon. That extra information is more than useless. It's harmful. It confuses the issues.

What screws up doctors when they are trying to predict heart attacks is that they take too much information into account.

It isn't intuitive, but it's correct.

Imagine how hard it was to convince the country's doctors that three questions could diagnose a heart attack better than their years of education, training, and full information on the patient.

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But guess what?

Cook County is now one of the preeminent hospitals in the country for diagnosing chest pain.

And just this week, a group of nine specialty medical boards — from oncology to cardiology — recommended doctors perform 45 common tests less often.

Eight others will soon follow suit, and the American Board of Internal Medicine Foundation in conjunction with Consumer Reports is launching an educational campaign aimed at showing doctors and patients that less information can indeed be more.

Tune It Out

I've urged you many times to 'tune out the noise.'

From Toddlers and Tiaras to the daily infights of our Congress, much of the stuff that overloads our senses is impertinent.

I spent the past few days fishing in the Keys. I hardly read any news, financial or otherwise...

And I felt more in tune than I had in months.

So take a break. Tune it out. And try to hone in on what really matters — and has bearing on yourlife.

Call it like you see it,

Nick Hodge

@nickchodge on Twitter

Nick is an editor of Energy & Capital and the Investment Director of the thousands-strong stock advisory, Early Advantage. Co-author of the best-selling book Investing in Renewable Energy: Making Money on Green Chip Stocks,  his insights have been shared on news programs and in magazines and newspapers  around the world. For more on Nick, take a look at his editor's page.

 

[Stir Young]

Truthfully, I can get all the news I need down at the donut shop, with an occasional visit to the Brew-ha.

One exception might be the weather.  I can't get enough of the Weather Channel.  However, I think that's mostly due to my propensity to ogle the weather chicks. 

[Faye Greener]

i used to watch the "Today" show for the news, but now I watch for the recipes and gardening tips.

[Baia]

I get the weather report by looking out the windows toward the SW.

There's only so much in this world that is under my influence.  I know what my responsibilities are well enough already.  I've never been an adrenaline junkie so most of this kind of "news" just makes me want to take care of my own business while I'm capable of it.

Worrying is bad for your health.

[darroll]

Sneaky way to put spam out.

[CWO3ROBBIE]

darroll, You have a point. I didn't even think about that. I read this article this morning and it said what I have been thinking about the overload of information available in the media today. I read a lot of stuff about oil and gas investments. I rarely take any advise from this news letter and did not mean it as a pitch for anything they are selling. But it sure does describe the excess communication era that we are living in. I can remove it if you think it violates the guidelines. 

[Baia]

I wouldn't worry about it, Robbie.  Just because the author is also selling his product doesn't necessarily invalidate the other information he is sharing to catch your attention.