When I was younger (in the early days of the internet, I'm not that old!) I always envisioned that as the information age washed over us, better information would be more readily available and we as a society would achieve a greater sense of knowing the path forward and make better decisions overall.
Do you remember in economics classes we learned that in an economy that people were rational actors and that there was a concept of "perfect information". The description from Wikipedia is below.
In economics, perfect information (sometimes referred to as "no hidden information") is a feature of perfect competition. With perfect information in a market, all consumers and producers have complete and instantaneous knowledge of all market prices, their own utility, and own cost functions.
So from a personal standpoint, have we achieved an internal sense of informational nirvana? How are we doing on this "perfect information" concept? Do we know where the economy is going based on rule-based-data based off historical results?
As an individual investor I think it's harder than ever to make good decisions based on information. For every post/site describing an imminent recession, there's another saying the bottom is in. Do you trust analysts? Look at the range on analyst expectations below? Everywhere you look you see diverging views from experts.
So after 9 months of managing my money, what have I learned?
- Perfect information does not exist
- Do not fall for confirmation bias
- Pick a few investing strategies, learn them well and follow the experts
- Embrace diverging opinions and think critically about them
- Protect your capital: 50% loss is 100% gain needed to breakeven