I write this blog to be a lone voice of intelligence crying out in the wilderness. There is too much stupidity in the investing world for me to defeat alone even if I had several lifetimes. The best I can do is identify stupid things that deserve ridicule.
Here's a bunch of totally stupid sources, in progressive order of magnitude (i.e., the one at the bottom of the list is the stupidest; I had to point that out in case one of my readers is stupid).
Wall Street sell-side analysts. This should be an obvious source of baloney after the big settlement a decade ago that forces investment banks to offer more independent research. Corporate clients of i-banks still have egotistical executives who need their egos stroked, so sell-side research persists to give them coverage. Investors who use analysts' garbage will probably underperform the markets. Analysts put a lot of thought into calculations and arguments that will resonate with sophisticated investors. They're more dishonest than stupid because they do have college educations, but knowingly choosing the easy wrong over the hard right is not a smart life choice.
Popular "investing" magazines. I used to think articles with headlines like "The Five Mutual Funds You Must Buy Now" had some kind of special revelations. I must have been stupid. Magazines sell by inflaming people's base desires. Fear and greed drive even purportedly intellectual content like financial writing. My own financial writing is driven by sarcasm and contempt.
Television networks. CNBC is the worst of the bunch but Fox is right up there. Watching clueless hedge fund managers make fools of themselves on TV is a sport but know-nothings take their pronouncements seriously. If I had a nickel for every time some guest on CNBC said "You want to buy stocks that are going up" I'd have . . . a whole bunch of nickels.
Mass-mailed pump sheets. These are hilarious. I get them all the time and they make great blog fodder. They stay in business because some micro-cap companies can't get publicity any other way.
Co-workers at the water cooler. Even people I worked with at major investment firms knew less about investing than me. I can only wonder whether their clients could relate to them out of shared stupidity. If investment firms are this dumb, just imagine how dumb the typical worker must be at non-financial companies.
Your mother-in-law. Need I say more? I rest my case.
I have greatly reduced my own stupidity over the years by tuning out these stupid sources. Pursuing non-stupid sources like my graduate school finance textbooks and the life wisdom of Warren Buffett, John Bogle, and others is way better than staying stupid.
