The interview published above is from SDPB’s daily public affairs program, In the moment with Lori Walsh.
A Biased Media Diet Can Harm Your Financial Health
By Rick Kahler
Part of supporting my clients’ financial well-being requires that I have a good understanding of current global economic, political and financial events and how they apply to my clients personally and individually. It is also important for a financial therapist to understand and validate the different perspectives of clients.
Not only do I spend a considerable amount of time following the news, but it’s important that the data and news I assess is as factual and accurate as possible. Yet balanced sources of information are few and far between. For example, if one person only gets their news from CNN and another person gets all of theirs from FOX News, their worldviews will be 180 degrees apart.
Part of the reason is that most of us are affected by something called “confirmation bias.” It is a tendency to focus on information that confirms and underlines what we already believe, and to ignore or dismiss sources that contradict what we believe. Confirmation bias is further reinforced by the use of algorithms in social media and internet searches. These track our online preferences and offer us more similar information, so the belief-confirmation-belief-confirmation cycle becomes ever tighter.
As I’ve seen repeatedly throughout my career, behavior like selling off the stock market or going all-in, based solely on one’s beliefs and political biases, is almost always a recipe for financial disaster. .
For this reason, I encourage you to evaluate your media diet. Two sources you can use to gauge whether your media consumption is balanced and varied are Media Bias/Fact Checking and Advertising Media Fonts.
You might wonder how biased these two bias assessment services are. If you search for your favorite media sources and find them ranked extreme right or left with a low likelihood of being factual, your immediate thought will likely be that the service leans left or right and one cannot not believe it. This is actually evidence of your confirmation bias. Unsurprisingly, news sources that have been rated poorly by either are highly critical of them.
Still, I did some fact checking on both sites. Both have been criticized as being subjective, basing their conclusions on small samples and not using scientific methods. In 2018, the Columbia Journalism Review describes Media Bias/Fact Check as an amateurish attempt to categorize media biases and characterizes their assessments as “subjective assessments” [that] leaving room for human prejudices, even simple inconsistencies, to creep in. However, a study published in Scientific reports concludes: “While [Media Bias/Fact Check’s] its credibility is sometimes questioned, it was considered accurate enough to be used as ground truth for, for example, media bias classifiers, fake news studies and automatic fact-checking systems.
A Article 2021 on the blog of the Association of Collegial and Research Libraries argued that Ad Fontes’ media bias chart is detrimental to media literacy efforts because it “promotes a false equivalence between left and right, touts a political ‘center’ as unbiased, and reinforces harmful perceptions about what constitutes “news” in our media ecosystem, and is ignored by anyone who does not already have a comparable view of the media landscape.
Since judgment bias is inherently somewhat subjective, my conclusion is that both sites have some flaws but are reasonable sources. Assessing the inclination of the media you consume is important. Becoming more aware of your confirmation biases can give you a broader context and perspective that supports wiser long-term financial behavior. Most of us have seen how extreme bias in any direction can damage relationships. Bias can also get in the way of making reasoned and informed financial decisions. and can cause long-term damage to a person’s financial and emotional well-being.