Choose the correct information

In the era where we are bombarded with ton of information, carefully choose the correct information is crucial. After all, bits and bytes of information can be more dangerous than ignorance.

Once upon a time, when the information is hardly obtained by an ordinary people like us, we treat the information we obtained like precious metal. We absorbed what ever we could in the hope that we become more knowledgeable. While this is a correct attitude for the improvement of humanity, this only applied to the society where the information is scarce. When the situation changes, where we could easily obtain whatever information that we wish as long as we connected through the internet, choosing the correct information becomes crucial. This phenomenon is similar to the society who lacked of food, and making them no choice to choose what the food they wish to put inside their stomach.

Very often, by absorbing the misleading information, either consciously or unconsciously would only bring the devastating result to us. Take the example, whenever a company announces its profit soaring in a particular quarter, do not be so excited and thrush your money into it. The reported earnings lie to its word “reported” and whether it is “real” earnings, only god knows. Simply by Creative Accounting, the management and its related interested parties could manipulate the company account and show the public a “soaring reported earnings”. There are too many ways for the manipulation, by cooking the book, by selling off the assets to boost one-time earning, by dealing business among related companies are among few examples of the manipulation. The only way to be a successful investor lies to your passion and your home work – no short cut.

Over the years, I found out that the asian investors are the lambs that become the prey of the fox of financial industry. The information that is out of date and no longer applied in the western world could be sold in asian countries. Take an example, after 97/98 Asian Financial Crisis, many asian investors isolate themselves from the stock market. Because of the cash piling up, they need to find a way to invest their cash pile. Where the market would always supply what demand needed, the financial industry came out with the “Capital Guarantee Fund”. These hungered investors pouring their hard-earned money into the funds. Other examples like “Buy and hold”, “The price of real estate is always appreciate in the long term” and “Blue Chips counters is a safe haven for the investor”. There are too many examples that show that people without a proper knowledge tend to become the prey. While ignorance people have no choice but become a sacrifice, the most pitiful people are the one who obtain misleading information and yet they feel they got the correct information.