Blogs are languishing. So says The Economist.
According to research traffic to popular blogging sites has flattened out while traffic to social media sites like Twitter and Facebook continues to surge. That doesn’t mean people have stopped communicating. It just means they are communicating in different ways.
That jibes with our experience in the blogosphere and on StockTwits. Nearly every blogger we follow has a social media presence. Even if it is limited to noting their own posts. What social media does is amplify and extend discussions started on blogs. Just as those blog posts are often a reaction to stories originated in the mainstream media. Social media helps amplify those stories and ideas that people find of interest.
The Economist notes that blogs still thrive in areas that involve “special-interest publishing” like economics. The point being that in certain areas longer-form communication is necessary. Trading and investments being another. Mike Bellafiore at SMB Trading notes that it takes him time to properly outline a trade scenario.* He continues (and we quote at length):
Maybe the future is individual commentators and traders developing a small loyal band of followers. These individuals have their genius and stick to this. For example, they do not make long term market calls if this is not their thing. They are who they are and accept their limited genius. They do not step outside their expertise to bring in a wider audience of followers. There will be respected networks that still work to ensure these individual are legitimate as best they can. Perhaps the future financial media model will look like this: many more “gurus”, with much smaller audiences, making much less money, offering much more awesome content to followers who derive substantial value. Maybe that is the best and worst of what financial media can be.
As noted and in our own experience the best bloggers have developed their own distinctive voice. They do this by carving out a niche for themselves that is a function of both heir own professional experiences and their interests. The vast majority don’t find that fame and fortune in their blog, but they may develop their own devoted following. The new world of social media is particularly effective in finding these experts and bringing them to the fore.
That doesn’t mean there isn’t a whole class of people looking to bypass this vetting process. Mike in his post highlights a prominent trading expert who, in fact, doesn’t trade at all. Unfortunately our brains are putty in the face of these so-called experts. Jonah Lehrer at The Frontal Cortex writes:
..even terrible expert advice can reliably tamp down activity in brain regions (like the anterior cingulate cortex) that are supposed to monitor mistakes and errors. It’s as if the brain is intimidated by credentials, bullied by bravado. The perverse result is that we fail to skeptically check the very people making mistakes with our money.
What are we to do? Emerging networks are becoming increasingly powerful, and by extension useful. In part they do this by aggregating information, but they also do this vetting and promoting those individuals who demonstrate true specialized expertise. The (investment) world is an increasingly complex place where this expertise is of particular value. What you need is to develop your own team of specialists to help combat the false promise of the superficial guru. Thankfully the tools to do so are becoming increasingly available.
*Hat tip to The Reformed Broker.