Without RTA, I don't think I agree with your comment. For two reasons.
First, markets move on information. Maybe one piece of big, important information, like a war, or more generally millions of bits of information. But it is a reasonable observation to note the correlation between big news stories and market moves.
Second, most times markets don't move on big news. In that case, the trend that I've seen for over a decade is for people to simply speculate on why the market moved one way or another for a particular day. It's not science, it's not news -- it's informed speculation, or entertainment.
I think serious investors let this type of entertainment roll off of them -- after all, people like to chat, and media forums like the WSJ (or HN) provide them a forum to do so.
Separating the noise from the signal is the entire purpose of becoming a good investor. Thinking it's all signal or all noise is a good way to never be one.
That's half true. Markets move from capital flows of institutions on much larger timeframes-- those flows are what create trends. There is an underlying auction process that facilitates trade and capital flow-- the auction process is the short term noise that is dominated by the larger money about 30% of the time.
Yesterday was a great example. Yes, the market had a big move on the news, and capital flows moved quickly out of domestic equities. But we also had rate problems coming out of China and weakness in European credit markets. To say that the brunt of the market movement was caused by a political speech does not correspond to reality.
it's informed speculation, or entertainment.
Yes! And the WSJ generally avoided that, until recently.
I think serious investors let this type of entertainment roll off of them
If you're saying that markets do not move on information alone and then several sentences later saying that serious investor _do_ let this type of information affect them? Looks suspiciously like self contradiction.
And I'll bet the WSJ has always done this. Pick up an issue from 1950 and see if it isn't tying current news stories to the market. It was the same then.
This seems to me to be another version of "things were so much better way back when and now it's all garbage"
But I'll bow out. I didn't RTA. Just found your comments popular yet (to me) seemingly uninformed.
> If you're saying that markets do not move on information alone and then several sentences later saying that serious investor _do_ let this type of information affect them? Looks suspiciously like self contradiction.
I think that your definitions of 'serious investor' are divergent.
"uninformed" in the sense of failure to understand the role of media. Not uninformed in the sense of failure to read easily digestible pieces of the market.
All media (that I know of) have engaged in a mix of news, speculation, and opinion for my entire life -- and probably centuries before I was born.
This article seemed to me so much like restating the obvious that I was very underwhelmed.
And BR is saying that he is moving WSJ from "essential" to "infotainment" pile, so you're not particularly disagreeing (ISTM). BR's point is that in the past, WSJ wouldn't indulge in this kind of speculation outside its opinion ("cartoon") pages.
First, markets move on information. Maybe one piece of big, important information, like a war, or more generally millions of bits of information. But it is a reasonable observation to note the correlation between big news stories and market moves.
Second, most times markets don't move on big news. In that case, the trend that I've seen for over a decade is for people to simply speculate on why the market moved one way or another for a particular day. It's not science, it's not news -- it's informed speculation, or entertainment.
I think serious investors let this type of entertainment roll off of them -- after all, people like to chat, and media forums like the WSJ (or HN) provide them a forum to do so.
Separating the noise from the signal is the entire purpose of becoming a good investor. Thinking it's all signal or all noise is a good way to never be one.