Reacting to headlines is treacherous for your health and wealth.
Consumer Reports tossed this one at the wall.
PROTEIN POWDERS CONTAIN DANGEROUS LEVELS OF LEAD!
Social media pounced on the lead poisoning angle, and the major news outlets piled on. Cue panic. Suddenly, your morning shake seems more like a toxic cocktail.
Headlines like these exist to attract eyeballs, not disseminate knowledge.
Hyperbole is sorely lacking in context.
Consumer Reports based its claim on a misleading safety threshold of just 0.5 micrograms of lead daily.
According to Arnold’s Pump Club:
That number is not a federal standard; it’s an ultra-conservative internal benchmark with no clinical evidence that it represents harm.
The FDA’s guidance for lead in foods is many multiples higher.
Common foods like spinach, strawberries, apples, carrots, and chocolate naturally contain trace amounts of lead from soil, sometimes more than the protein powders being criticized.
A bit of context never hurts.
We often see the same type of behavior regarding the financial media. They’re experts at spreading needless hysteria.
But if you zoom out and ask thoughtful questions, you might realize the danger isn’t what it seems. The same logic applies to financial headlines designed to make investors flinch.
Below are four simple questions that work just as well on protein powder scares as on stock market “emergencies.”
Compared to what? Scary numbers are meaningless in isolation. 0.5 micrograms of lead sounds like pure poison. If you include that, it’s the same level found in a serving of spinach, so things don’t seem so onerous.
Market Crash Wipes Out $500 Billion!
Including the fact that the U.S. market’s $50 trillion valuation makes this 1% dip seem like a bad hair day rather than a financial apocalypse. Newsflash – Markets are volatile and rarely post “average” returns..
Based on what standard? Unsafe levels come from many different sources. Is this number from a fact-based regulatory organization or an arbitrary number from a fringe group?
We see many headlines screaming about the stock market’s treacherous overvaluation. What exactly is overvalued? Small companies, Tech Stocks, International equities? The market is composed of various sectors, countries, and market caps. It would help to be more specific instead of throwing a match into gasoline.
What is the danger? Magnitude matters when it comes to risk. O.5 micrograms of lead isn’t nothing, but pales to the health threat of getting into your car and driving to McDonald’s for a burger, shake, and fries.
The same goes for Federal Reserve Interest Rate hikes or cuts. A .25% percentage move affects the economy, but it’s not the asteroid that obliterated the dinosaurs.
Who’s being studied? Many health studies involve mice, children, or sick patients. The results may not apply to your current predicament.
The same goes for the rehashed “Markets in Panic” headlines. Who is panicking? Day traders? Hedge Funds? These transitory plunges are negligible noise if you have a long-term time horizon and a well-crafted balanced portfolio catered to your risk tolerance and time frame.
Health scares and market crashes have much in common: They’re rarely as dangerous as headlines want you to believe.
Panic is expensive, but perspective is free.
Become a free-rider by ignoring clickbait and seeking context.
