“We are drowning in information, while starving for wisdom. The world henceforth will be run by synthesizers, people able to put together the right information at the right time, think critically about it, and make important choices wisely.”
– Edward O. Wilson
It is mind-blowing to think about how much information is available now versus 20 years ago, or even just 5 years ago. And yet part of the problem is a data deluge. It is incredibly tempting to be distracted by useless information… or to pay undue attention to the wrong information… or to self-select news sources and get trapped in an echo chamber… the potential pitfalls go on and on.
As the flow and volume of information increases, the ability to parse and sort that information becomes an ever more valuable skill. There are parallels here to the way grandmaster chess players process chessboard information versus amateurs. While the amateur has to painstakingly work through a complex situation — analyzing, say, ten different possibilities in detail — the grandmaster uses a process called “chunking” to reference a library of patterns in his head, then immediately zeroes in on the one or two pattern matches that are relevant.
This creates both a speed advantage and a depth of analysis advantage: Having cut away the subpar lines of play more quickly, the grandmaster can either move more quickly (saving time and energy) or invest a savings of time and energy in deeper, more nuanced analysis of the two moves that matter. The natural synthesis process increases speed, accuracy, and efficiency simultaneously, thus allowing for compound investment of the surplus.
An accumulation of small advantages in the information processing space can strengthen and reinforce itself, in small subtle ways, until finally becoming indomitable. The ability to put together “the right information at the right time,” thus allowing the ability to act with conviction before a window of opportunity closes, is in some ways the essence of trading.
What are you doing to enhance your “synthesizer” skills? Are you distracted by low-value information, or focused on high-value information? Do your data streams drown you… or act as a rich source of nourishment? Do you have a reliable means of strengthening conviction — or diluting pre-existing conviction as appropriate — based on what the information flow tells you?
I talk about the exact process we at MO use to separate the wheat from chaff in this short video I put together, which you can watch here. I cover a number of important concepts, most of which I haven’t seen discussed anywhere else. Now, more than ever, it’s critical to have a process for bypassing the noise and getting to the signal. Give the video a watch if you want to learn exactly how we do that.
Co-Founder of Macro Ops. Alex is a former US Government Counterintelligence Professional, U.S. Army Interrogator, and USMC Scout Sniper. He’s an independent trader with over 10-years in markets.