{"id":30423,"date":"2012-06-22T11:23:40","date_gmt":"2012-06-22T15:23:40","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/2012\/06\/why-i-dont-watch-cnbc\/"},"modified":"2012-06-22T11:23:40","modified_gmt":"2012-06-22T15:23:40","slug":"why-i-dont-watch-cnbc","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2012\/06\/22\/why-i-dont-watch-cnbc\/","title":{"rendered":"Why I Don\u2019t Watch CNBC"},"content":{"rendered":"<p>Article by <a href=\"http:\/\/www.investmentu.com\/\" target=\"_blank\">Investment U<\/a> <\/p>\n<div><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-29862\" title=\"Why I Don\u2019t Watch CNBC\" src=\"http:\/\/www.investmentu.com\/wp-content\/uploads\/2012\/06\/why-i-dont-watch-cnbc.jpg\" alt=\"Why I Don\u2019t Watch CNBC\" width=\"220\" height=\"220\" \/><\/p>\n<p>Don\u2019t get bullied by the media into changing your well thought out plans. Once you have a plan, stick to it, until your needs change, not the market or economy.<\/p>\n<\/div>\n<p>At a recent <em><a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/www.investmentu.com\/latest-research\/the-oxford-club.php\">Oxford Club<\/a><\/em> gathering in New York, Alexander Green told a crowd of investors that they shouldn\u2019t watch CNBC.<\/p>\n<p>I couldn\u2019t agree more.<\/p>\n<p>As Alex put it, \u201cCNBC\u2019s goal is not to make you money, but to sell advertising.\u201d While I believe that most of the reporters are committed to doing their best on a story, the structure of CNBC is to keep you on the edge of your seat, depending on them for information on what to do next.<\/p>\n<p>For instance:<\/p>\n<p><em>The jobless numbers were higher than expected \u2013 what do you need to know to keep your portfolio safe?<\/em><\/p>\n<p><em>Inflation ticked higher \u2013 can your portfolio withstand a higher inflation environment?<\/em><\/p>\n<p><em>How should you get your portfolio positioned before the Fed meeting next week?<\/em><\/p>\n<p>It reminds me of an old bit by comedian Tom Kenny (who went on to fame and fortune as the voice of SpongeBob SquarePants). Kenny talked about how sensationalized the commercials are for your local news. No matter what the story was, the voice-over would say, \u201cWould you survive? Would your family survive?\u201d<\/p>\n<p>And then the scenarios became even more ridiculous. \u201cWhat if you were in an earthquake, trapped in a store that sold nothing but knives, propped up on flimsy shelves made of jagged glass? Would you survive? Would your family survive?\u201d<\/p>\n<h2><strong>CNBC Wants a Reaction to Every Market Hiccup<\/strong><\/h2>\n<p>That\u2019s essentially what CNBC is trying to do. They want you to live in fear and react to every little hiccup in the market so that you\u2019re glued to their network in order to receive the investment advice from their guests and anchors.<\/p>\n<p>But if you make just one move to improve your portfolio\u2019s performance this year, it should be turning off CNBC.<\/p>\n<p>In fact, you should tune out most of the financial media.<\/p>\n<p>If you\u2019re invested for the long haul, it really doesn\u2019t matter\u2026<\/p>\n<ul>\n<li>If inflation is up two-tenths of a percentage point this year.<\/li>\n<li>Or if the Consumer Confidence Index dips 3%.<\/li>\n<li>Or if the Bull-Bear Sentiment Indicator switches from bullish to bearish.<\/li>\n<\/ul>\n<p>Your portfolio should be positioned to withstand good times and bad. You shouldn\u2019t be jumping in and out of the market or sectors based on news, politics, the economy, or any other event.<\/p>\n<h2><strong>Why Market Timing and Portfolio Repositioning Don\u2019t Work<\/strong><\/h2>\n<p>That kind of constant repositioning virtually guarantees that you\u2019ll miss some of the biggest up moves in the market and be in the wrong place at the wrong time.<\/p>\n<p>In 2009, Invesco conducted a study showing the effects of missing the 10 best days of market performance over the past 81 years.<\/p>\n<p>If you invested $1 in the S&amp;P 500 in 1928 and held it, in 2009 it would have been worth $45.18.<\/p>\n<p>However, if you missed the 10 best days during those 81 years (all of which came during the Great Depression and Great Recession), you\u2019d have just $14.99, two-thirds less.<\/p>\n<p>It would have been easy to miss those 10 days if you were spooked out of the market during those turbulent times. Of course, you likely would\u2019ve missed the 10 worst, as well.<\/p>\n<p>If you missed the 10 best and 10 worst, you would\u2019ve ended up with $47.59, a tiny bit more than the buy-and-hold strategy.<\/p>\n<p>However, market timing is nearly impossible. If it was easy, everyone would do it. In my 20 years following the market, I\u2019ve never come across anyone who could do it well consistently.<\/p>\n<p>You shouldn\u2019t try, either.<\/p>\n<h2><strong>Stop Depending on the Financial Media and Allocate Your Assets Intelligently<\/strong><\/h2>\n<p>For your long-term funds, be sure the assets are allocated in an intelligent way. I recommend The <em>Investment U<\/em> <a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/www.investmentu.com\/asset-allocation-model.html\">Asset Allocation Model<\/a> or <a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/www.investmentu.com\/research\/gone-fishin-index-fund-portfolio.html\">The Gone Fishin\u2019 Portfolio<\/a>, which consists of inexpensive Vanguard index funds.<\/p>\n<p>I don\u2019t mean to pick on just CNBC. Much of online financial media is designed to generate page views, not make you money. There\u2019s a proliferation of websites that throw every ticker symbol they can into a story so that it shows up in as many places as possible \u2013 all designed so you click through to see what the news is \u2013 increasing page views.<\/p>\n<p>I\u2019ve lost count of how many times I clicked on a story involving one of the stocks in my portfolio, only to read the \u201cnews\u201d item that had absolutely nothing to do with my stock.<\/p>\n<p>The lesson here: Don\u2019t get bullied by the media into changing your well thought out plans. Once you have a plan, stick to it, until your needs change, not the market or economy.<\/p>\n<p>I haven\u2019t had CNBC on in my office in four years. It\u2019s wonderful.<\/p>\n<p>Good Investing,<\/p>\n<p>Marc Lichtenfeld<\/p>\n<div>\n<a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=fbCMqs_24G0:T2woisk4XaM:yIl2AUoC8zA\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?d=yIl2AUoC8zA\" border=\"0\" \/><\/a> <a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=fbCMqs_24G0:T2woisk4XaM:V_sGLiPBpWU\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?i=fbCMqs_24G0:T2woisk4XaM:V_sGLiPBpWU\" border=\"0\" \/><\/a> <a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=fbCMqs_24G0:T2woisk4XaM:qj6IDK7rITs\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?d=qj6IDK7rITs\" border=\"0\" \/><\/a> <a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=fbCMqs_24G0:T2woisk4XaM:gIN9vFwOqvQ\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?i=fbCMqs_24G0:T2woisk4XaM:gIN9vFwOqvQ\" border=\"0\" \/><\/a> <a rel=\"nofollow\" target=\"_blank\" href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=fbCMqs_24G0:T2woisk4XaM:F7zBnMyn0Lo\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?i=fbCMqs_24G0:T2woisk4XaM:F7zBnMyn0Lo\" border=\"0\" \/><\/a>\n<\/div>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/InvestmentU\/~4\/fbCMqs_24G0\" height=\"1\" width=\"1\" \/><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/SyndicationFeed\/~4\/Gsey89tf0u4\" height=\"1\" width=\"1\" \/><\/p>\n<p>Article by <a href=\"http:\/\/www.investmentu.com\/\" target=\"_blank\">Investment U<\/a> <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Article by Investment U Don\u2019t get bullied by the media into changing your well thought out plans. Once you have a plan, stick to it, until your needs change, not the market or economy. At a recent Oxford Club gathering in New York, Alexander Green told a crowd of investors that they shouldn\u2019t watch CNBC. &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/www.investmacro.com\/forex-news\/2012\/06\/22\/why-i-dont-watch-cnbc\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Why I Don\u2019t Watch CNBC&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-30423","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/30423","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=30423"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/30423\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=30423"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=30423"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=30423"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}