The premise of this report is in fact sound and quite intriguing:
Most investors would acknowledge that social media is playing an increasing role in their investment decisions. Yet no-one has mapped the emerging network of influence likely to be playing a crucial part in those decisions.
... Some professional investors believe that many of the sites in this loose network have proved a better source of information than the traditional media, especially and crucially in the run up to the financial crisis.
Clearly, a new and significant source of information is available to investors. One with an audience of over 38 million. However given that this is the case, it is also important to understand who the main players are, how they interact with the Government and other sectors and how they influence each other.
The results this study presents, however, are puzzling in the extreme, if for no other reason than this site is ranked #13 on a list which includes such internet traffic and page-click—if not critical or intellectual—giants as Naked Capitalism, Zero Hedge, and Dealbreaker. I mean shit, homey, I get fewer visitors in a year than any one of those link monsters get in a week. Whassup?
The other puzzlement, which diligent consumers of this site will appreciate immediately, is that I have never offered one ounce of actionable investment advice among the billions of words I have tortured into existence here since the beginning of 2007. Unless professional investors count verbal disembowelment of Goldman Sachs executives, merciless ridicule of excessively short, excessively rich private equity plutocrats, or scathing satire of flag-waving, chest-thumping idiocrats among the hedge fund community as timely investment advice, I must say my writings have no more use to them than a lunchtime visit to Gawker or TMZ. (Which, by the way, I would consider a flattering comparison. We all have to get our freak on occasionally.)
The answer to this conundrum lies, of course, in MindfulMoney's methodology, which they do not elaborate to any great extent in the published report. One might assume inbound and outbound links have something to do with the calculated importance of any one node or blog within the social network, but even so, this site is characterized more by the number of other sites on the list it has linked to, rather than the number of inbound links it has received therefrom. Anyway, Mrs. Dealmaker Mère always told me never to look a gift cheval in the mouth, so there I will let the mystery lie.
From a broader perspective, however, one can raise interesting questions. Why, for example, does the arguably most heavily trafficked and influential site in the econoblogosphere, Felix Salmon's site at Reuters, not show up on MindfulMoney's social network? Surely, Felix does not offer prepackaged investment tips, but neither do I (see above), and neither do a number of prominent blogs on MindfulMoney's list. Why, also, do extremely popular and well-frequented investment sites such as The Reformed Broker and absolutely essential finance information aggregators such as Abnormal Returns or Alea not make the cut?
More importantly, I think MindfulMoney has seriously missed the mark on realtime investment influence in the social network of the investment world by ignoring Twitter. After a year or so, Twitter has replaced most of the methods (like RSS) I used to use to aggregate and collect links to information on economics and finance into one frenetic, unmoderated, and absolutely essential knowledge stream. While I do not use it this way myself, I am aware of countless individual and professional investors who use Twitter as a realtime forum for the analysis, exchange, and promotion of actionable investment ideas. Then there is the burgeoning StockTwits network, which I, being a staid and heavily regulated investment banker avoid like the plague, but which boasts a fast-growing and extremely passionate membership of money managers small and large.
The recommendation I would therefore leave you with, O Dearly Beloved, would be to take this latest "Best of the Web" compilation by MindfulMoney with a heaping helping of salt. It offers an intriguing window onto one interesting corner of the finance econoblogosphere, but it fails utterly to capture the whole of the developing finance information ecosystem in all its febrile, sweltering, and frenetic glory. Information, like water and money, is promiscuous, mobile, and free, and I expect the social network of the finance and investing world to continue to metamorphose as frantically as Proteus struggling under the grasp of Menelaus.
In the grand scheme of things, my friends, Your Faithful Correspondent will likely continue to offer little more than faint and feeble commentary from the cheap seats. The good news is that I've always liked the peanut gallery.
© 2011 The Epicurean Dealmaker. All rights reserved.