Gustavo Ballvé on August 27th, 2012
Food for thought, Home, Mental models, Signal or Noise

Lance Armstrong chose to become a martyr and declined the chance to defend himself against USADA’s accusations of systematic doping during his amazingly victorious career. That is old news by now. But the press coverage here in Brazil made me revisit several things about information, investigation and knowledge. There’s a lot to learn from this episode if one is really worried about the quality of the information one gets, but most importantly, about the quality of “knowledge”/conviction one hopes to achieve. I’m far from alone (or even original) in pointing out some similarities between investment research and journalism, so please bear with me (there’s a bonus link in the end).

First of all, the episode reminded me of how hard it is to actually form an opinion. Clearly most Brazilian journalists chose to outsource their reports to mass-media vehicles from the US, while many simply chose to believe Armstrong’s side or the accusers’ based on sympathies, cynicism, or fear that Lance’s demise could jeopardise the brilliant work of his Livestrong foundation. Well, I am a cycling nerd as well as an investment nerd, so I had and have been reading several sources abroad – sources that are closer to the confusion, with more to gain or lose – for months now. I am just someone very interested in cycling’s history, so I put in the work, while many journalists clearly didn’t. They chose to take the shorter, “make-sense” route. As a result, their reporting – and their “knowledge” – clearly lacks substance. I definitely will not write my opinion here, but rest assured that the whole case is way more complicated than it seems.

Second, I’ve gained a lot from spreading my reading between 3 or 4 sources, all specialized in cycling, once I noticed their particular biases and conflicts of interest. Furthermore, I found two internet forums / discussion boards that had people from all walks of life – lawyers, doctors, etc. – who share a passion for cycling, and it was a powerful reminder of crowdsourcing at its best, given the diversity and quantity of inputs, allowing for many viewpoints, analyses and fact gathering. It’s amazing how deep some people will dig when they have a true interest in a given subject. No doubt that the analysis of seasoned and brilliant journalists, who can both investigate and write well, is very important. But in this particular case I learned just as much about the case from the forums – and since there are of many people contributing from all around the world, the crowd turned out to be faster in both uncovering and processing new information than the publications.

Third – and this is very important – is the fact that once you put in the effort, once you search for many sources, and especially once you start reading forums, the sheer amount of information can be overwhelming – especially because with so much input comes an absurd amount of noise. So I had to constantly adjust my sources, filter for haters and blind believers to find the people who could actually maintain a level and open mind while discussing and analyzing logical conjectures and facts. The “normal” internet forum is a perfect habitat for all sorts of bullies – irrational, aggressive people whose convictions accept no diverging opinions – and this case was even more emotionally charged. So, in the end, the effort to filter out the misinformation was huge and not for the faint of heart. And it tends to become more so now that everyone feels entitled to an opinion.

You can read the three paragraphs above and consider the press coverage about the Facebook rise and fall, or Groupon’s. And think back to not so long ago when people were absolutely convinced that Amazon.com was toast. My point is just that the coverage of the investment realm can be as sensational, passionate and irrational as the coverage of Lance Armstrong’s ban.

It’s always up to us to keep our heads cool, our minds open and our drive to improve our “knowledge” relentless. The best sources can be surprising, so it pays to dig deep and put in the effort.

Finally, and coming to terms with this post’s title, if you have to read something about “Armstrong”, let it be this beautiful piece on the late Neil Armstrong.

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