Why Is the Media Not Reporting This Good Gold Story?

Uh-oh… We’ve got excellent news and poor news. But you will have to figure out which is which.

We also have what is almost certainly the most critical factor you will study this year…

Yesterday, the Dow fell once again – 81 points. Gold went up – by virtually $ 10 per ounce. Gold does not appear inclined to go down considerably a lot more… at least, not right away. And even though some huge players look to be dumping gold – we will not mention any names – most of the gold orders are buys, not sells.

Here’s Paul Tustain, CEO of physical gold storage enterprise BullionVault, on gold’s current correction:

[H]ere are some BullionVault statistics from the final few days, which I feel offer you a beneficial reminder about how markets function. Remember, first of all, that for all those folks who sold in a bit of a panic, a person bought.

1. Monday and Tuesday have been our strongest 48-hour period for new consumers this year.

2. Since Friday, the gross worth of buyer bullion sales increased markedly. About 1% of gold we appear after was sold back to the main marketplace. That was characterized by a couple of large sellers. Holders of 99% of BullionVault inventory have been not panicked.

3. These who did sell have mostly not withdrawn their cash from the BullionVault technique. To me, that suggests they might be intending to purchase back into gold sooner rather than later.

four. We typically have about 230 deposits a day (300 on a Monday) and about 100 withdrawals a day (120 on a Monday). Mondays are normally greater because they consist of weekend activity. On Monday, we had 723 deposits versus 284 withdrawals. On Tuesday, we had 732 deposits versus 150 withdrawals.

5. Monday was a record day for company transacted, beating the earlier peak of September 2011.
Candy for the Mind

And now… here’s why you actually should not spend attention to any news. It really is “public data” – with tiny integrity, tiny high quality and little usefulness.

Here’s our friend, the Swiss novelist Rolf Dobelli.

News is poor for you. It is like sugar. It offers you a rush. It is a distraction from your own issues. It’s easy to digest. But this “candy for the thoughts” can be toxic.

In the previous couple of decades, the fortunate amongst us have recognized the hazards of living with an overabundance of food (obesity, diabetes) and have started to modify our diets. But most of us do not yet realize that news is to the thoughts what sugar is to the physique.

News is simple to digest. The media feeds us tiny bites of trivial matter, tidbits that never truly concern our lives and don’t need thinking. That’s why we experience nearly no saturation. Unlike reading books and long magazine articles (which require pondering), we can swallow limitless quantities of news flashes, which are vibrant-colored candies for the thoughts.

Nowadays, we have reached the exact same point in relation to details that we faced 20 years ago in regard to meals. We are starting to recognize how toxic news can be.
News Misleads

Take the following event (borrowed from Nassim Taleb). A auto drives over a bridge, and the bridge collapses. What does the news media focus on? The car. The particular person in the automobile. Where he came from. Exactly where he planned to go. How he skilled the crash (if he survived). But that is all irrelevant. What’s relevant? The structural stability of the bridge.

That is the underlying threat that has been lurking and could lurk in other bridges. But the auto is flashy, it is dramatic, it’s a person (non-abstract), and it is news that’s low-cost to make. News leads us to walk around with the fully incorrect threat map in our heads. So terrorism is overrated. Chronic stress is underrated. The collapse of Lehman Brothers is overrated. Fiscal irresponsibility is underrated. Astronauts are overrated. Nurses are underrated.

We are not rational enough to be exposed to the press. Watching an airplane crash on tv is going to modify your attitude toward that risk, regardless of its actual probability. If you think you can compensate with the strength of your own inner contemplation, you are incorrect. Bankers and economists – who have effective incentives to compensate for news-borne hazards – have shown that they can’t. The only answer: Reduce your self off from news consumption entirely.
News Is Irrelevant

Out of the roughly 10,000 news stories you have study in the final 12 months, name one that – due to the fact you consumed it – permitted you to make a greater decision about a significant matter affecting your life, your profession or your organization. The point is: The consumption of news is irrelevant to you. But folks uncover it quite challenging to recognize what is relevant. It really is significantly simpler to recognize what’s new. The relevant versus the new is the fundamental battle of the present age.

Media organizations want you to think that news offers you some sort of a competitive benefit. A lot of fall for that. We get anxious when we’re reduce off from the flow of news. In reality, news consumption is a competitive disadvantage. The significantly less news you consume, the larger the advantage you have.
News Has No Explanatory Energy

News things are bubbles popping on the surface of a deeper globe. Will accumulating information assist you recognize the world? Sadly, no. The connection is inverted. The crucial stories are non-stories: slow, strong movements that create beneath journalists’ radar but have a transforming impact. The a lot more “news factoids” you digest, the less of the huge image you will understand. If more details leads to higher economic success, we’d expect journalists to be at the leading of the pyramid. That is not the case.
News Is Toxic to the Body

It continually triggers the limbic method. Panicky stories spur the release of cascades of glucocorticoid (cortisol). This deregulates your immune program and inhibits the release of growth hormones. In other words, your physique finds itself in a state of chronic stress. Higher glucocorticoid levels trigger impaired digestion, lack of development (cell, hair, bone), nervousness and susceptibility to infections. The other potential side effects incorporate fear, aggression, tunnel vision and desensitization.
News Increases Cognitive Errors

News feeds the mother of all cognitive errors: confirmation bias. In the words of Warren Buffett: “What the human getting is very best at performing is interpreting all new information so that their prior conclusions remain intact.” News exacerbates this flaw. We become prone to overconfidence, take stupid risks and misjudge opportunities. It also exacerbates an additional cognitive error: the story bias. Our brains crave stories that “make sense” – even if they never correspond to reality. Any journalist who writes, “The market moved due to the fact of X” or “The company went bankrupt simply because of Y” is an idiot. I am fed up with this cheap way of “explaining” the world.
News Inhibits Pondering

Thinking demands concentration. Concentration calls for uninterrupted time. News pieces are especially engineered to interrupt you. They are like viruses that steal attention for their own purposes. News makes us shallow thinkers.

But it is worse than that. News severely affects memory. There are two kinds of memory. Lengthy-range memory’s capacity is practically infinite, but operating memory is limited to a specific quantity of slippery data. The path from quick-term to extended-term memory is a choke point in the brain, but anything you want to realize need to pass by way of it. If this passageway is disrupted, nothing gets via.

Due to the fact news disrupts concentration, it weakens comprehension. On the web news has an even worse effect. In a 2001 study, two scholars in Canada showed that comprehension declines as the number of hyperlinks in a document increases. Why? Because anytime a hyperlink seems, your brain has to at least make the option not to click, which in itself is distracting. News is an intentional interruption program.
News Operates Like a Drug

As stories create, we want to know how they continue. With hundreds of arbitrary story lines in our heads, this craving is increasingly compelling and difficult to ignore.

Scientists utilised to think that the dense connections formed amongst the 100 billion neurons inside our skulls were largely fixed by the time we reached adulthood. Nowadays we know that this is not the case. Nerve cells routinely break old connections and type new ones. The far more news we consume, the far more we exercise the neural circuits devoted to skimming and multitasking whilst ignoring those used for reading deeply and thinking with profound focus.

Most news buyers – even if they utilised to be avid book readers – have lost the ability to absorb lengthy articles or books. Right after 4, five pages they get tired, their concentration vanishes, they become restless. It is not since they got older or their schedules became a lot more onerous. It’s because the physical structure of their brains has changed.
News Wastes Time

If you read the newspaper for 15 minutes each morning, then check the news for 15 minutes for the duration of lunch and 15 minutes ahead of you go to bed, then add five minutes here and there when you are at perform, then count distraction and refocusing time, you will lose at least half a day every week. Data is no longer a scarce commodity. But focus is. You are not that irresponsible with your money, reputation or health. Why give away your mind?
News Makes Us Passive

News stories are overwhelmingly about factors you cannot influence. The everyday repetition of news about items we cannot act upon tends to make us passive. It grinds us down till we adopt a worldview that is pessimistic, desensitized, sarcastic and fatalistic. The scientific term is “discovered helplessness.” It is a bit of a stretch, but I would not be shocked if news consumption at least partially contributes to the widespread disease of depression.
News Kills Creativity

Lastly, things we already know limit our creativity. This is one particular explanation that mathematicians, novelists, composers and entrepreneurs usually generate their most creative performs at a young age. Their brains enjoy a wide, uninhabited space that emboldens them to come up with and pursue novel tips. I do not know a single genuinely inventive mind who is a news junkie – not a writer, not a composer, mathematician, physician, scientist, musician, designer, architect or painter.

On the other hand, I know a bunch of viciously uncreative minds who consume news like drugs. If you want to come up with old solutions, study news. If you are searching for new solutions, do not.

Society requirements journalism – but in a various way. Investigative journalism is always relevant. We need to have reporting that polices our institutions and uncovers truth. But crucial findings don’t have to arrive in the kind of news. Long journal articles and in-depth books are great, as well.

I have now gone with no news for 4 years, so I can see, really feel and report the effects of this freedom firsthand: significantly less disruption, much less anxiety, deeper pondering, a lot more time, more insights. It is not simple, but it really is worth it.

[This is an edited extract from an essay 1st published at dobelli.com.]


Bill Bonner