The media manipulate your mind
In a world that is hugely influenced by "news", let's take a look behind the scenes of how the media really works, how the "dark arts" of this industry are used to make a living.
Why are we paying attention to this? Because we're tired of a world where certain blogs take indirect bribes, marketers help write the news, reckless journalists spread lies, and no one is responsible. We "lift the tip of the veil" because we don't want anyone else to go blind!
Think about how you consume media, you don't read one article, you probably read several articles that vary a lot. You are unlikely to pay anything for it. All the publishers want is the number of people who read their article. So journalism is about what spreads - not about what's good. This makes us think about the mental models and how the human mind works. Take the financial press. People get hyper about the markets when they listen to hyperbolic headlines.
To grab readers' attention, the media exaggerates events and stirs the emotions of investors who are guided by fear or greed. The result is always an emotional game of ping pong, which leads to illogical investment behaviour (such as buying when there's a "hausse" and selling when there's a bear market). This happens because once you've formed a belief, adding exceptions and justifications becomes easier than changing or updating them.
Our mind has a switch-off mode in a sense. This way you can plan effectively. Once your mind has accepted a plausible explanation for something, it becomes a framework for all information perceived after that. We are subconsciously drawn to fit and twist any subsequent knowledge we receive into our framework, whether it fits or not. Psychologists call this "cognitive rigidity." The facts that formed an original premise are gone, but the conclusion remains: the general sense of our opinion hovers over the collapsed foundation that built it.
Information overload, "busyness", speed, bias and emotion all exacerbate this phenomenon. They make it even harder to update our beliefs or stay open-minded. Once a belief is formed, the mind tends to cling to it. Accepting new ideas becomes difficult.
Perhaps it is best to consider the following statements:
- The best way to make money is by speculating on the next sector promoted by the media.
- I can save money by choosing my own investments.
- Now is not the best time to invest in the markets.
These statements are strongly influenced by pre-existing beliefs. Even the most intelligent people can fall into the trap (we often hear this from highly successful expats).
The mind shuts down and does not let in new information. The trick, if there is one, is to form working beliefs, not permanent beliefs. Stay open-minded and don't be influenced by public opinion alone!
The wise investor has learned to look beyond the colourful adjectives that describe day-to-day market swings and keep his eyes on long-term trends.
If you are an expat looking for sound financial advice, it is important to choose a fiduciary consultant. 98% of expatriate financial advisors receive commissions from the sale of financial products, leading to a conflict of interest.