Beyond The Headlines
A Noisy Distraction
It’s been a long while since I watched any financial news channel. That changed last week, though. I was sitting on a plane (still a rare occurrence these days). The screen in front of me was split to accommodate half a dozen talking heads. Stock quotes were running in multiple lines at the bottom and headlines on the right with some charts. I didn’t have the right headphones with me, and I couldn’t listen to it, but I felt that this silent screen was screaming at me, desperate for my attention.
From what I can tell, very few investment advisors don’t watch financial news, and even fewer will admit that they don’t. After today, you’ll know at least one. This experience reminded me of the importance of a self-imposed information diet, not just in investing but in life in general.
I have nothing against financial news channels. They can be good entertainment and an example of very creative use of the TV screen real estate.
In the midst of last year’s market crash in March, I got many calls and messages from friends and colleagues. They wanted to know if I’m watching the financial news and if I heard what this or the other talking head had to share with the public. It was a very uncertain time; the US stock market lost three years of gains in three weeks. Travel stopped. Toilet paper became a hot commodity. We couldn’t leave our homes, and the economy stood still for a moment.
I gave them all the same short but polite answer: “No, I’m not watching any news. My partners and I are going through a wish list of ideas and buying stocks every day. We see shares at 5-10 or even 20-year low prices. We are as busy as it gets.”
As disciplined contrarian investors, we live for moments like that. I didn’t want to lose a single minute watching any news; it was the time to stay focused, calm, collected, and act. There was nothing that any TV expert would say that would sway us in any other direction. I only wondered how those experts had the time to get on TV instead of doing what we were doing. We knew exactly what we wanted to buy, how much we were willing to pay, and we were on the phone with our brokers doing the work, not missing a single beat. This was the most opportune investment moment in a decade.
I couldn’t even hear the six talking heads on my small screen on my flight, but the headlines were loud and clear. Apparently, we were all bracing for earnings of some particular company reporting after the market close. I just settled in my chair, and I wasn’t planning to brace for anything until the pilot advised otherwise. The terminology used reminded me of a horse race, boxing match, football game, or a space rocket launch gone wrong. It alternated between allegedly unbelievably good news and unexpectedly terrible news all in no time.
Buy, sell, panic, cheer — all mixed together. I learned that there are some actionable trades to do in the morning and others in the afternoon, and there is halftime to regroup. I change my mind too, but I never have six opinions about the same thing in a single day. I had to buckle up and brace myself for an emotional rollercoaster that lasted only a few minutes until I turned off the screen, picked up my book, and enjoyed a quiet flight.
I was reading Bill Bryson’s – “The Body, A Guide for the Occupants.” I enjoyed his “Walk in the Woods,” where he shares his adventures on the Appalachian Trail. Megan and I hiked sections of the Trail last spring and summer.
This loud news experience was no surprise to me. It was more of a reminder of the importance of a self-imposed information diet. I mention it in many posts; I even gave talks about it to groups of investors over the years. In investing, the environment that one creates for oneself matters as much or more than skills, knowledge, and experience. It’s not enough to know what to do; it’s as important to be able to think for yourself and act on it.
For many years, running around New York City from the office to lunches, events, and back, I’d see those silent, loud, tiny screens everywhere from the elevators to conference rooms and even kitchens. One office building, I remember, had Disney cartoons for a change. That was refreshing.
When a friend asked me recently if I watched the financial news channel this morning, I said no. He asked if I am living under a rock. I guess you could say that I have lived under a rock for over a year now. Megan and I spent half of that time in the deep woods with great Wi-Fi but no opportunity to see an elevator TV screen and the second half wasn’t that much different with a quaint seaside town as a backdrop. I’ve had an incredible amount of time to read, write, and think, though, more than at any other point in my life.
William Deresiewicz, a former Yale professor and author of a thought-provoking manifesto “Excellent Sheep: The Miseducation of the American Elite and the Way to a Meaningful Life,” shared in a speech at West Point in October 2009: “Thinking means concentrating on one thing long enough to develop an idea about it. Not learning other people’s ideas, or memorizing a body of information, however much those may sometimes be useful.” “If you want others to follow, learn to be alone with your thoughts.” – he concluded.
I treasure my quiet thinking time with no news, noise, or distractions. I’m immediately reminded of Sir John Templeton, the legendary investor who moved from Manhattan to the Bahamas in the 1960s. He did just fine reading the Wall Street Journal that arrived a few days late on the island. He shared how being away from the noise helped his thinking and investment results.
I have a laptop; I get the news. I read a lot. I take a good number of calls each week, but I value my information diet, otherwise. In investing, patience and discipline can be developed and nurtured, but neither is infallible. I make my life easier, and tune out of big swaths of noise out there, so I can hear myself think. Never watching the financial news is just a small part of it. It makes for more enjoyable flights, helps my quality of sleep and (hopefully) improves my investment choices as well!
The information provided in this article represents the opinions of Sicart Associates, LLC (“Sicart”) and is expressed as of the date hereof and is subject to change. Sicart assumes no obligation to update or otherwise revise our opinions or this article. The observations and views expressed herein may be changed by Sicart at any time without notice.
This article is not intended to be a client‐specific suitability analysis or recommendation, an offer to participate in any investment, or a recommendation to buy, hold or sell securities. Do not use this report as the sole basis for investment decisions. Do not select an asset class or investment product based on performance alone. Consider all relevant information, including your existing portfolio, investment objectives, risk tolerance, liquidity needs and investment time horizon. This report is for general informational purposes only and is not intended to predict or guarantee the future performance of any individual security, market sector or the markets generally.