How much does the news influence you?

Does the negativity of the news get you down?

As much as I like being up to date with current affairs, I consciously don’t watch or listen to the news as much as I used to. I was an avid watcher of the BBC News at 10pm but in recent years the news has become so full of death, destruction, negativity and pessimism that I am today happy to go without.

I used to listen to the news on Radio 4 a lot when driving (the phone ins on Radios 2 and 5 have always annoyed me, full of people just moaning about anything). These days I tend to opt for some classical music on Radio 3. Maybe I’m getting old?

We have been telling clients for years to ignore the media. Why?

We manage a lot of money for our clients, invariably their life savings, so although we need to be up to speed with the global markets and economic events, we don’t learn a lot about investment management from the media at all and I don’t think you would either.

The media produce a lot of noise, mostly sensationalist nonsense (the American media is the worst). Journalists are not paid to inform or educate you, they are paid to grab and keep your attention. You may well find it informative, perhaps entertaining, but I doubt it helps you making good, long-term financial decisions.

The media promotes the short-term and short-term market movements will have a negligible impact on your long-term financial well-being. And such negativity creates negative biases, anxiety and over-reactions, which in turn can easily lead to poor decision making.

Media treatment of the stock market in 2018 has been a case in point. In February the media was full of the market falling 10%, of countless billions being wiped off the stock market and untold economic rot setting in. As I wrote at the time, such market movements are entirely normal and probably long overdue.

Fast forward to May and the FTSE100 is back to almost breaking another all-time high but I bet you don’t hear the media talk of untold billions being added to the stock market?!

I happened across a New York Times article recently about a man in Ohio who went on a media fast, so despondent was he with the state of his country following the Trump presidential election. 17-months later and he is still successfully avoiding any form of news noting “I’m emotionally healthier than I’ve ever felt”.

You can read ‘The Man Who Knew Too Little’ here.

With the media, less is more. Be careful how much of it you consume.