ARC's 1st Law: As a "progressive" online discussion grows longer, the probability of a nefarious reference to Karl Rove approaches one

Friday, July 29, 2005

NYTimes and Investing

Investment advice you can take to the BANK...

JUST BEING CONTRARY Carl Futia is a Yale and Berkeley economics grad who runs a website where he publishes his market forecasts, based in part on "the theory of contrary opinion." He writes,
I happen to think that the New York Times is essential reading for any investor. I systematically do the opposite of whatever the Times is encouraging its readers to do, and this investment strategy has been very successful.

He makes a significant point, but I think it applies to more than just their economic or financial analyses. The New York Times is the embodiment of conventional wisdom, as its news articles are regurgitated not only by the punditocracy elites in NYC, DC, and LA, but also by newspapers and other legit news outlets around the country. And, if there's anything you can take to the bank and have a probability of success that is greater than 0.5, it's that conventional wisdom is dead wrong. The big money can be made in wisely going against the passions of a mob.

If the New York Times recommends a course of action in investment, the fact that this message is so pervasive means that its impact is huge. And when large masses move in a single direction, money can be made... If the Times predicts a shoddy economy and this becomes conventional wisdom, one can snap up undervalued stocks that tank on the news and profit when the results are "better than expected."

May be adding this guy to the blogrooooooolllllll

Your Co-Conspirator,
ARC: St Wendeler