Have you heard about the "Mean World Syndrome"?
Mean World Syndrome is an idea from George Gerbner, a professor at the University of Pennsylvania (Gerbner has since passed away). The gist of his idea is that people who watch large amounts of television are more likely to perceive the world as a dangerous and frightening place. Too much exposure to violence and crime through TV, movies, video games, film, and other sources can influence some people to believe that we live in an inherently evil and "mean world". It's often referred to as 'cultivation theory' - perceptions of the world heavily influenced by popular media.
Have a think about the mass media you may consume - TV, radio, internet - and think what it is that media thrive on: feel good stories are in the minority, what sells are dramatic, often sensationalised stories of bad news, appealing to emotions such as fear and anger.
Not everyone will be effected the same way, of course, those that can sift through the story, think for themselves, do their own research will likely be less susceptible
What has all this got to do with forex trading? Or any trading and investing?
The forex media, and financial media in general, are not immune from competitive industry forces, in which 'bad news' often sells; "sells" being perhaps page clicks, reputation, advertising revenue, 'newsletter' subscriptions. Market developments can be reported from a 'bad news' angle, and good news can often be played down, skewed, or not reported at all if it conflicts with a popular, and most likely 'its all bad', narrative.
And it's not just in forex trading, trading data from ETX Capital shows persistent gains in US equity indices over (nearly) the past decade.. Yet, this bull market has been accompanied by almost wall-to-wall negative reporting, always looking for the next 'crash'. Those with a less than pessimistic (mean financial world) view are mocked and ridiculed, despite being on the right side of the market.
Of course, those that can assess stories for themselves and sift through the information will be much less susceptible to being taken in by the negative bias. But we are not all savvy enough to assess the news independently, it's a learned skill and those new to financial markets can be especially excused from being unable to sort through the (negative) information overload. Be aware of what you take in when you are forex trading - if you are yet to learn the game ask those you can trust, those that report developments in as even handed a manner as possible.
