The Rise of Influencers

On Twitter, one is known more by the number of people who follow you than by what you have accomplished. A fund manager who manages thousands of crores in active funds and who is one of the few who has been able to beat the benchmarks, whose tweets are mostly data based is followed by a fraction of what many of these influencers.

I love to read books but my mind always wishes to browse through Twitter. The effort required to read a book is multiple times that of simply scrolling through twitter and like Alice in Wonderland “Curiouser and curiouser!” it gets.

Buying wonderful business at a fair price is the Buffett motto that gets preached by everyone. The mantra is valid in theory for if you can get a good business cheap, the risk of losing money is very less. But finding such businesses, that is quite another story.

Invest for the long term, say Advisors. To showcase the advantage of long term investing, one set showcases the long term trend of the Sensex and shows how good the long term returns sare. Influencers on the other hand show the same in a different way – If you had invested X in the IPO of Y, today you would have Z in your Bank Account. 

When RJ recently passed away, what got most eyeballs was his CAGR. Thisdespite the fact that since RJ was a private investor, we have no clue about how much he invested over time. The starting point of 5000 and the ending point of a few Billions is used to showcase that he had the best investor returns – more than what Warren Buffett or Jim Simons have showcased. 

What many did not show or point out was the fact that this was achieved by taking some incredibly bold and risky bets, bets that no advisor of any merit would ever recommend to a client. 

The other day, I heard about a friend of my brother who is embroiled in deep debt thanks to his addiction to fantasy games – the games that are advertised by literally every other Cricket player today. How is Kohli or Dhoni different from an Influencer who said, break your FD’s and invest in this crypto that shall yield X% I wonder. 

In China, many a Influencerer have made it big selling stuff they promote to their followers. Stuff that their followers may not have required but get attracted to buying because we want to be seen as part of the herd. 

Same goes in the US too. Kylie Jenner was named the youngest ever to become a self made Billionaire thanks to her ability to sell cosmetics to her huge fan following. Fans many whom I doubt required that let alone be able to afford it. But hey, if it’s fashionable, it’s what sells and the more fashionable it is, the more it gets eyeballs. A spiral of a kind.

In the last few years, Option trading has exploded in India. NSE added fuel to the fire by starting weekly options. It reminded me of the days when Karnataka had a Daily Lottery. Why buy a lottery and wait for a month when you could buy a lottery today and get the results in a few hours. Thousands went bankrupt playing a game that was biased against them. Thankfully the government for once decided to take the right path and banned all lotteries. 

We all wish to become rich and become rich in the shortest period of time. Financial Independence and F*ck you money are banded about as the goals one needs to achieve. Influencers make it seem that this is possible without much effort and sitting in the comfort of your home. 

The reality is that very few of us will ever be able to become really wealthy in the course of our life. Our expectations are forever moving higher. What seems great if I had today will not seem that great a few years down the lane when we are closer to achieving it or heck, even achieved it. 

For every Warren Buffett or George Soros out there, there are thousands if not more of Bill Hhwang’s. We never get to hear their stories because who wants to see a movie where the Hero dies at the end.

From the days when brokerage was 2.5%+ to today when it’s free, one absolute certainty is that very few players in the market survive over the decades, let alone thrive. But the guys who sell the shovels to the gold diggers and one who doesn’t himself get attracted to digging himself are the ones who not just survive but thrive.