News Arbitrage

The News business serves the function of realignment of the information asymmetry that exists in society due to naturally occurring factors such as geographic locations, and time differentials. One of the earliest forms of news was the hand written accounts of political diktats from Caesar in 59BC.

The newspaper had come a long way from there and at its peak formed the backbone of the information dissemination mechanism till as late as the 1980s. They not only reported fact but were also used to influence opinion through editorials and special interest stories.

Fast forward to today and so much has changed. Given that TV, Radio and the Web cover news as it happens, people look towards newspapers for thought leadership and opinion setting.

Yet every morning when you go through the news paper it is significantly difficult to find legitimate news let alone thought leadership. The newspaper today consists largely of sensationalism, regional supplements, and special topic supplements. Where is all the news gone I ask. I often find myself going through the process of hunting for something interesting or stimulating to read.

I venture that the only use for newspapers given the trash that they publish is for its arbitrage value. The raddi wala (scrap paper buyer) gives you 5-7 rupees for every kilo of newspaper that you sell him. Given that the cost of the newspaper every morning is around 2 rupees I am increasingly inclined to just sell the paper and make profit on it. It is definitely a better use than reading it. Imagine another business that would give you over a 100% profit