Investors are desperately trying to cut through the glut of information in search of meaning and knowledge.
What are they reading now, and how?
The following article was originally published in “What I Learned This Week” on August 9, 2018. To learn more about 13D’s investment research, please visit our website.
Concerns about information overload are as old as the ancient philosophers. Plato worried that people would not be able to discriminate between texts that were morally worthy and those that were not. Seneca argued that “you must linger among a limited number of master-thinkers, and digest their works, if you would derive ideas which shall win firm hold in your mind.”
Today, information overload has reached a degree that not even Plato could have fathomed. More than 2 million articles are published every day on the web. The Washington Post alone publishes 1,200 articles, graphics, and videos daily, more than a story every two minutes — and that only scratches the surface. According to Domo’s Data Never Sleeps 6.0, 156 million emails, 473,400 tweets, and 4,333,560 YouTube videos are sent, shared, or watched every minute around the world.
On a more granular level, this means the average worker receives around 121 emails daily. And because email and alerts are designed to exploit the brain chemical dopamine that keeps us checking our phones, they are difficult to ignore. In a 2002 paper, researchers found that for 70% of messages, it took the average worker only 6 seconds to react to a notification for an unread email.
This constant need to “check” is draining our brain power, scientists say. Screens have changed our reading patterns from traditional left-to-right sequences to wild scanning patterns as we hunt for keywords and details. A survey of 1,100 Britons by TNS Research and Hewlett Packard found that workers distracted by emails, phone calls, and texts suffered a greater loss of IQ than a person smoking marijuana. Another study by McCombs School of Business, at the University of Texas at Austin, found that merely having a smartphone in reach, even if it’s off, reduces our cognitive capacity.
The average American struggles to go more than 10 minutes without checking their phone, but are reading fewer books a year. We have literally become addicted to distraction.
Solutions are beginning to percolate. A few organizations are quitting email all together (and finding they are getting more done). If you want David Villa, chief investment officer at the Wisconsin State Investment Board, to respond to your email, you need a secret code. Jesse Felder, publisher of the Felder Investment Report newsletter, has made a conscious effort to restrict the alerts that flood him daily:
“I have no smartphone. I got rid of it a year ago. And all notifications are turned off on my iPad which is what I do most of my reading on. When this reading is done I put the device in a drawer so the temptation to use it is diminished.
All of this is in an effort to enhance my ability to do deep work, which I think is one area where there is great potential for competitive advantage for investors currently.”
Still, the ability to focus seems to be at risk. One of our most trusted sources has his investment team read a book or an essay every morning for ninety-minutes straight before diving into email and work. He also keeps his computer on one side of his office, and designates the other side for work — that is, for reading, writing, and thinking. It began as a practice in his own life, and he found it so productive, he enforced it company-wide. But his employees’ reactions surprised him:
“I said, I’m not going to monitor you, but tell me the truth: can you really read something for 90 minutes without interruption? Or do you go out of your mind? And the vast majority failed. The younger generations especially are so accustomed to checking email and social media feeds, that to stop it for even 90 minutes is very difficult. If you work on a laptop in a cube you actually have to close the laptop. It’s amazing how many people are unwilling to do that.
I’m not a technology basher. We may be cultivating other skills through social media. But we have to use the technology, rather than letting it use us.”
We have been writing about addictive technologies for years. Now, there appears to be a backlash brewing caused by a variety of factors including the deep desire to connect on a profound basis, the realization that our brains are not functioning as well as they used to, and the growing awareness that tech companies are creating technologies that save us time, but do not help us create quality. And yet, as the knowledge economy accelerates, our ability to analyze deeply has rarely been more valuable. This is one of the great challenges of our time.
All of which has investors wondering: how are we going to solve problems, be effective, and think long-term if we cannot reflect and focus? How do we cut through the junk to find meaning? What are you reading these days, and how?
When we put these questions to our readers and sources, some themes began to emerge. Investors are reading widely, from fiction to philosophy and trade periodicals, but they are also craving deeper discussions beyond the news, a slower, more focused experience. This means circulating book lists among friends and tuning into podcasts and webinars. It means carving out time to read in print, and discussing ideas with people in real-time.
For instance, our source who has his team read a book for 90 minutes day, has also created a “media club” within his firm and among his close friends. Together they circulate articles they find interesting, investment-related or not, and jot down notes in the columns. He told us:
“That’s what really important, the annotated notes. Then we collate them and distribute to everybody in the firm. What’s fun is that everyone usually highlights something different, and that’s a rich source of conversation.
What I like to remember is how often a great investment idea comes from three or four different essays that were seemingly unrelated, but because they were gestating in my mind, I was able to hang them up and say wait a second, this idea led me to this idea, which then led me here.”
Likewise, Felder says he reads 3 to 4 hours of news and research in the morning, and fiction every evening. When it comes to Twitter, Felder says he is ruthless. He has over 62.2K followers, but only follows about 100 feeds, and he uses an app called Nuzzel to prioritize the content they share. “This goes a long way towards separating the signal from the noise at least when it comes to tracking which narratives are gaining greater traction in the marketplace,” he told us over email.
When we posted our questions to Twitter, Force Majeure Capital replied:
“Trying to read as much as possible but not about daily noise…Typically books related to themes (tech), thinking (antifragile, creativity), financial fraud, biographies, macro etc.Plus, intensive discussions with finance friends.
Also, podcasts. [They’re] a very good way to ‘read’ on your daily commute when you are not able to sit down and actually read.”
Finally, Mark Carnegie, a Venture Capitalist in Sydney, Australia, says he reads to understand history and how it sheds light on today. He tweeted: “How did WWI happen? What makes the collective unconscious reach for authoritarian populist leaders? What are we losing with the ‘woke’ movement?” His latest reads include Radetsky March, Joseph Roth’s 1932 novel about the fall of the Austro-Hungarian empire, and Herman Melville’s classic Moby Dick, which he worries will “get washed away by political correctness in university.” If we fail to find meaning amidst the noise, much more than Melville will be washed away.
Investors are desperately trying to cut through the glut of information in search of meaning and… was originally published in 13D Research on Medium, where people are continuing the conversation by highlighting and responding to this story.