Now that some one else has gotten my dream job as President of the Federal Reserve Bank of Minneapolis I have been waxing philosophical about the state of the financial blogosphere. The health of the financial blogosphere is of supreme importance to me. For one it was the fodder for my Grammy-winning book, Abnormal Returns: Winning Strategies from the Frontlines of the Investment Blogosphere, but also it provides the raw material for the daily output for this blog which has been at it for ten years.
In a post noting the seventh (!?!) anniversary of The Reformed Broker blog, Josh Brown noted the many ways in which the financial blogosphere has changed and why so many promising bloggers have dropped out of the game. You should read Josh’s post in its entirety but here is one reason why independent investment blogs seem to be on the wane that resonates with me. Brown writes:
They ran out of stuff to say or lost their edge. One of the most common things I’ve seen is that a new blogger begins as though they were shot out of a cannon, with weeks worth of incredible material. And then, when they’ve written the 10 or 20 posts that had been bursting to come out for years, they’re spent. Like a bumble bee that dies minutes after stinging something with all its might. These expended bloggers typically end up dispensing the rest of their wisdom on Twitter once they’ve run dry of original material.
Moving over to Twitter is a common experience. I noted in a post on the death of the financial blogosphere some three years. Apparently this is not a new topic because Josh also weighed in at the time on the topic as well. Independent bloggers like Bronte Capital can still have a material effect on the price of a stock. The fact that we are still writing about the topic three years later shows the financial blogosphere isn’t dead but it has matured. *
One thing that hasn’t changed is that it is still difficult for independent bloggers to make a go it from a financial perspective. Barry Ritholtz of the Big Picture, the biggest financial blog around, in response to a question about the financial rewards of blogging said this:
People have this false impression that if you write a successful blog people are going to throw money at you. It doesn’t really work that way. What it does do is allow people to understand you — here’s this person’s view of investing, here’s how they think, here’s how they analyze the world, the markets and the economy. I think what it does is, when people have a conversation with you about managing their assets, it shrinks that six-month conversation down to half the time.
The tech world has seen a surge in independent bloggers experimenting with different monetization techniques. One of my favorite bloggers Ben Thompson at stratechery has seen great uptake in a (leaky) subscription model and an ad-supported podcast. Dan Moren and Jason Snell are trying a similar thing at their Apple-focused site Six Colors. This shows there is still some hope for additional monetization models.
The guys at StockTwits made a go of it with the StockTwits Blog Network which I was proud to be a part of. See this post from Brian Lund on how it changed his life. My friend Phil Pearlman made a go of it at Yahoo Finance before the firm changed strategic direction. The question is whether any one can really pull it all together?
The Ritholtz Wealth Management crew including Josh, Barry, Ben Carlson at A Wealth of Common Sense and Michael Batnick at The Irrelevant Investor have made blogging a centerpiece of their strategy. As well they should because collectively they are by far and away the best collection of blogging talent out there. Hopefully their focus on quality content translates into further success. The challenge for the rest of the blogosphere is whether there is a financial model out there that makes all the time and effort worthwhile.
*In contrast Mark Thoma writing at The Fiscal Times noted how economics blogging “isn’t dead, far from it. It is just getting started.”