One of the first passages of the book resonated with me. It concerns the fact that the news we are bombarded with daily by the media is increasingly negative and pessimistic.
This is normal since bad news attracts more readers’ attention. Bad news is “urgent” and must be relayed immediately (and as sensationally as possible), while good news is less urgent; it can always wait.
But in my opinion, Mr. Housel has put his finger on another reason why we are more and more overwhelmed with bad news: the media and the means of communication are global today. There are eight billion people on Earth, the vast majority of whom are connected in real time to the rest of humanity. Eight billion people who act and interact every moment. It is therefore completely normal that improbable events, events that we describe as “one in a century”, occur regularly, every day, somewhere on our planet. You can count on the world’s media and social media to be reporting them over and over again.
In the past, 100 years ago or even 50 years ago, we relied much more on local media for information. In a Quebec village of 10,000 people in 1920, there was little chance that a significant negative event would affect the village and make the headlines in the local newspaper every month, let alone every day. This newspaper therefore relayed a lot of positive information, good news.
You will agree that local media have been losing ground for many years and that it is difficult to see how they can reverse this trend which will favour national and global media in the years to come.
This leads me to believe that we are not done reading or hearing bad news. Unfortunately, we will have to get used to this reality. Above all, it is a reality that an investor must understand in order not to be influenced.
