Somehow, 2020 is the start of my *sixth decade as a journalist.
Not sure if that makes me “grizzled” or “old-fashioned” or simply a “dinosaur,” but the calendar’s yardstick got me thinking: How does one keep their professional edge in an age where useful news gets lost in a nasty mixture of low-value, anger-inducing noise.
It’s an era when a brief financial swing or a single corporate move or one freshly minted data point can be blown up into an oncoming economic turning point of monumental proportion. Yet all-too-frequently, that news is actually more blip than a beginning.
Such hyper-analysis won’t help anybody make smart decisions. Nor is it good for anybody’s nerves.
So I’ve crafted some ideals I’ll try to stick to in the coming years. It’s sort of my professional resolutions for a new decade. These mantras are designed to keep my work, and the trusty spreadsheet, hopefully, pointed in the proper direction. But let me suggest it could also serve as a guidepost to how you could be a better consumer of economic information.
1. Ignore short-term gyrations
Plenty of pundits, not to mention the financial transactions industries, love to talk about the ups and downs of the day or week or month or even a quarter. Short-run swings feel far more interesting than slow-brewing, solid trends. However, what’s fodder for happy hour or a social media post often isn’t truly actionable information.
Note that in a decade when Dow Jones Index nearly tripled, Wall Street’s venerable benchmark declined on 45% of its trading days. l resolve to focus on longer-term trends.
2. No trend lasts forever
After living through the nation’s first decade without a recession, it’s easy to forget that dips happen. Not that the next downturn will be soon. Or that whenever a reversal occurs will it definitely be a massive decline. But the chance of disappointment should be on the radar.
I resolve not to forget that many of the business concepts succeeding in arguably one of the better economies in the history books may not have the durability to last the next downturn.
Like, how many poke bowl places does the world need?
3. Bad news sells
It’s a journalism truism for centuries that flies in the face of economic history. You know, the ups and downs of the business cycles. For example, portraying current economic conditions as poor — or worse — may get the buzz. But are today’s challenges anywhere near the Great Recession’s pain? Not that blind optimism works well, either.
The Redemption Decade Series
California’s 2.8 million new jobs outpace the nation
California home-price gains double the nation’s
California spending, from No. 2 US drop to No. 2 gain
How California’s population ‘exodus’ shrank
Big turnabout leaves plenty for California to fix
I resolve to see the good — and the bad — and tell the difference as best I can … all the while knowing all too well which brand of news draws more eyeballs.
4. California vs. Texas is dumb
This battle of the nation’s economic titans is great theater, both from a business and political sense. And I’ll admit I’ve written too much about the tussle. Why? Because the nation’s most challenging economic problems are outside the borders of these states.
In the past decade, California and Texas collectively created 6.1 million new jobs. That’s 28% of all new jobs created nationally in two states with only 20% of total U.S. employment.
5. Jobs matter
Any discussion about economic opportunity doesn’t go far if there isn’t job creation. Yes, one can debate the quality of jobs that have been created since the Great Recession. But new jobs give people the potential to afford the daily basics, plus, if fortunate enough, some nice things, too.
“Needing two jobs to pay the bills” happens more frequently in good times because there’s a plentiful opportunity to score an extra gig. And I resolve not to forget that jobs offer financial and psychological positives. Oh, and multiple jobholders nationwide peaked in the 1990s.
6. “Affordability” is mis-quantified
Just because somebody can craft a benchmark suggesting in a powerful tone who can afford what, real estate-wise, those yardsticks are of little use to a typical house hunter.
Many who want to own will make the sacrifices required, no matter what some “home affordability” index says. And I resolve to track the many financial variables that create ownership opportunities.
For example, California’s typical home costs 172% more since this century started, by the math of one federal index. But when you account for cheaper mortgages and inflation, a buyer’s house payment is theoretically up only 13%.
7. Guru fatigue
Bravo to those pundits who saw the housing bubble coming. Congrats to folks who predicted an economic revival before others. And a trophy to those who did both.
I send my condolences to those gloom-and-doomers who missed everything over the past decade.
Still, I resolve to eye track records of the opinion-makers — from economists to market analysts to stat jockeys — with a catch: nothing is a more commoditized today than having an opinion.
8. Rankings are simply fun
You’re lying if you have no interest in best/worst lists. I’ve been guilty of covering numerous graded scorecards comparing the economic performance of various regions. Hey, I produce a few of these yardsticks. In their defense, rankings can make economic analysis digestible for those who aren’t numbers geeks.
But ranking beauty is in the eye of the beholder. Take California as a place to live: 14th best state, says 24/7 Wall Street; No. 19 to US News and World Report; and 23rd best by WalletHub’s math. I resolve to remember that most of these best/worst lists are more entertainment than serious economic debate.
9. Mute CEO whining
Industries of all sorts have done a marvelous job in recent years of painting themselves as victims of unfair government interference in the marketplace.
Yes, some regulations make no sense. Yes, governments have been too heavy-handed at times with the economy. Despite this “tyranny,” the value of U.S. public companies managed to nearly triple to $33 trillion this past decade.
I resolve not to forget there is usually reason certain industries are over-regulated: they’re greedy.
10. Beware of personal anecdotes
Your life isn’t economic research. Even finding a handful (or horde) of folks experiencing a trend (or at least saying they have), does not mean that trend is real.
Main Street thinking can be just as ill-informed, if not deceiving, as the mindset of Wall Street, the C-suite or the bureaucracy.
In a fact-challenged world, I’ll keep the trusty spreadsheet humming. Numbers aren’t perfect, but they seem like a most-reliable source.
11. Watch the discounts
Many folks are flush enough today that coupons can seem like an annoyance. But watching the level of discount offered, whether you choose to partake in bargain hunting or not, can give clues to the economy’s next step.
I resolve to stay a vigilant “discountologist,” eyeing the deals merchants offer.
Like, I’m still puzzled at why this holiday season’s discounting seemed a little aggressive. Was it part of a great last stand by brick-and-mortar merchants vs. their online competitors? Or a hint at some economic angst?
12. Humor ex-Californians
People move. Always have. Always will. And Californians rarely move.
But if you want a good bet, assume that at least through the 2020s the state’s “progressive” politics will stick, California will stay an expensive place to live and various challenges associated with most of the world’s densely populated regions will remain.
I resolve to have only minimal sympathies for folks who seem surprised at these California givens, then wish to relocate. Look, the state is supposedly short of housing. Thank you for donating your home.
*Note: I could quibble with my own six-decade math. Yes, technically correct. I started working as a professional journalist at the late, great Pittsburgh Press in June 1979. But, thinking long-run, half a year doesn’t make a decade.