Does Instant Information Promote Market Efficiency?

I have been reading the updated sixth edition of Security Analysis from cover to cover and on more than one occasion, I have stopped to consider the major advantages modern day investors have compared to Graham and Dodd. Investors today have access to a wealth of information that Benjamin Graham lacked during his career. However, more widespread information also would theoretically lead to more market efficiency and reduce opportunities to find mispriced securities. Is it true that the market is more efficient due to the widespread dissemination of information made possible by the Internet and other technologies that have emerged in recent years?

If one considers the sources of information available to investors operating fifty years ago, it is obvious that there were many more hurdles standing between an investor and the knowledge required to make intelligent investment commitments. In fact, the situation was not all that different even 15 to 20 years ago before widespread access to the Internet. I remember spending hours in the library researching publications on microfiche, using card catalogs to find books, and sending out for annual reports when I first started to develop an interest in investing. This was not fifty years ago, but during the early 1990s.

There is too much information to absorb out there on Internet. The trouble is that much of information is unreliable and useless. When people talk about things they don't have firm grasp over, it could be misleading. Things get worse because information is spinned and manipulated to serve particular interest.

Much of information is propaganda in disguise. Its purpose is to confuse and distort, not to clarify.

If you look back and recollect reports and commentaries by business media for last decade or so, you can easily get this point.

In short, much of information out there is to shape your perception to the advantage of some powerful interest. They are often competing each other purposely producing conflicting assessment of the same event. Add fundamentally uncertain nature of market situation, and you could get easily fooled or led astray.

Information Revolution enhanced access to factual knowledge. However, it further enhanced the ability to shape and manipulate people's perception. They can more easily create virtual world made up of purely manipulated perception far more effectively now than in the past. The ability to play with people's perception has vastly improved enough to nullify any gain made from instant access to useful information.

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