Every 4 years, we go through the excruciating ritual of electing a president, and the process gets murkier with each succeeding campaign. Despite the enormous attention given to this process, large numbers of people simply don’t vote. TV’s “American Idol” garners more votes than some presidential candidates. Citizens of countries where they have no say in the selection of their leaders find this incomprehensible.
Reasons for this have alternately been attributed to everything from apathy to zealotry. There is, I believe, one acknowledged contributing factor: confusion. People have a natural aversion to making a mistake. Inaction is often seen as better than wrong action. In their bid for attention–and ratings–political commentators often shed more heat than light on the campaigns, leaving us not only confused but also with a king-sized dose of disgust.
There is a parallel in our own business. While political writers bask in the limelight every 4 years, financial writers, like the Energizer Bunny, go on and on. But isn’t it odd that as financial gurus in the press have proliferated, the nation’s savings rate continues to decline? Recent studies show our savings rate at the bottom of the industrial nations, despite a booming economy.
No wonder our capital expansions have been financed by the savings of the Japanese, Germans and now Chinese. Could it be that the confusion and seeds of doubt spread by the media’s financial advisors have often served to discourage savers using traditional methods in much the same way that political gurus instill a lack of confidence in candidates? Much of what I read in the financial press deals more with what the columnists believe a person should not do, or watch out for, than encouragement!
Reflecting on this question, I tried to think of people I know who have benefited from financial advice found in newspapers and magazines. In all my years in our business, I cannot recall a single person who has said, “I followed the advice of Jane Bryant Quinn and am now financially secure.” (I use Quinn symbolically, as a typical example of financial advisors in the public media.)