From Nov 2017 through Feb 2018, you couldn’t turn on the TV or read the news without hearing about Bitcoin. The coverage seemed universal across media platforms. Families were discussing Bitcoin over holiday dinners. It was so commonplace just a few months ago. Now we hear very little about it. Why is that?
“Bitcoin is a Fad”
Bitcoin isn’t a fad, but the reporting of it was. Surprising to many, Bitcoin has existed since 2009. But it wasn’t until the media chose to report on it that we became aware and interested. Its hyperbolic price increase attracted many to get in on the action…until the price fell over 60%.
Believe it or not, Bitcoin is still around. However, the reporting (or lack thereof) results in many of us going an entire day, or week, without thinking about Bitcoin. How could our thoughts and attention have changed so much in such a short period of time?
Media Dictates Our Attention
We receive cues from the media as to what to think about. We like to think we are independent, but the truth is our thoughts, attention and energy are heavily influenced by headlines. And when the media has determined a story/headline has run its course, it changes the news…thus changing our thoughts and attention.
We can take greater control of our thoughts and attention by strategically tuning out the media. The media exists to make a buck, and they need to sell ads to do that. In order to sell ads, they need our eyeballs. The financial media employs hyperbole, dire predictions and ever-changing quotations to get us to tune in. While interesting and sexy, all of those are detrimental to the long-term investor.
I wish financial planning and thoughtful investing were sexy. They are not. Investing is not buying what the financial media is touting today. It isn’t getting rich quickly. Investing is ignoring the hype and not investing in the “sure thing” of the day. While headlines and investment fads come and go, the principles of sound investing will persist.
(c) 2018 The Behavioral Finance Network. Used with permission.