When talking about the economy the same miscommunication seems to be taking place. While one woman’s economy refers to the behavior of investors and the stock market, another’s might mean the number of jobs she needs to keep the mortgage payments covered.
Context is everything in communication. My father used to tell a joke from his childhood at the launch of any planning on a new project. As a kid growing up in little Italy he was watched over by his very strict grandma, as were all the other kids in the neighborhood. While he grew up speaking a mix of Italian and English, Grandmas spoke only the Italian they grew up with, and very little English. Running around the garden one day, he and his neighbor knocked over an old terracotta planter, shattering it into pieces. “Did you see what your grandson did?” shrieked one Grandma to mine. “My flowerpot is in a million pieces!” My great grandmother laughed, “You’re insane.” She replied, “it’s clearly fine.” My grandma’s Italian was not the same as the neighbor’s. What she heard in her Irpinian dialect was that my dad broke her head, not her flowerpot. Hilarity ensued as the grandmas argued about whether her head was in a million pieces or her flowerpot was clearly fine.
When talking about the economy the same miscommunication seems to be taking place. While one woman’s economy refers to the behavior of investors and the stock market, another’s might mean the number of jobs she needs to keep the mortgage payments covered. While the stock market may be recovering, the job market is not. Recent news coverage has made clear that many workers see the economy, in this current COVID-19 crisis as referring to jobs and cash availability, not to investments and dividends.
The divide between Wall Street and Main Street was widening before the current coronavirus crisis. “There may have been a day when one could simply look at the performance of the stock market to gauge the health of an economy, but those days are no more. Or, at least, the relationship between the stock market and real economy is more attenuated now than ever before. If you squint, you can see a resemblance. But it's faint.”[1]
So how can a financial advisor discuss the stock market, investing and retirement planning in this communications morass? One way may be to acknowledge the tension between the two. “Just a few weeks into the coronavirus crisis, many are already pointing to the striking contrast between what has happened to the real economy and financial markets. This Main Street versus Wall Street tension is fueled both by legacy and current issues and sheds light on the state of economic and financial policies.”[2] That Bloomberg article goes on to make the distinction between the two crystal clear: “…30 million workers have applied for jobless claims in just six weeks …. 4.8% contraction in gross domestic product at an annualized pace in the first quarter with a further 30% to 40% decline in the cards for this quarter…. long lines outside food banks around the country…Yet Wall Street is coming off the best month for stocks in 33 years.”
The key may be in how you define your terms. One communications expert suggests, “defining your terms may seem tedious, and you don’t want to be patronizing when communicating with your readers, but you don’t want to be misleading either. Always use terms correctly, and find an elegant way to define the technical ones.”[3]
Another easy way to keep the tension and confusion out of your communications may be to simply use different terms. As one expert suggests, before starting a communication with a potentially vague term, or confusing issue, ask yourself four questions. “Here are four questions that will help you to define your meaning: Please use them: (1) When you say, BLANK, what do you mean specifically? (2) How would you know [when you have] BLANK? (3) What would you hold to be the test for BLANK? (4) … What are its three or four distinguishing characteristics?”
The time you spend being as clear as possible with your communications will be well felt by your clients.
[1] https://seekingalpha.com/article/4274153-reminder-wall-street-not-equal-main-street
[2] https://www.bloomberg.com/opinion/articles/2020-05-04/coronavirus-mend-disconnect-between-wall-street-and-main-street
[3] https://sciencecommunicationbreakdown.wordpress.com/2013/04/02/words-have-meanings
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