Why A High Un-employment Rate Might Not Be Bad

I like to read, in fact, I like to read a lot. I’m always reading newspapers, magazines, books, and blogs, but how do you know if what your reading is accurate, honest, and trustworthy? How do you know if the point of view you are reading is the right point of view? The reality is, there isn’t a right point of view and there isn’t a wrong point of view, but there is always more than one points of view.

Recently Jon Stewart interviewed Jim Cramer on The Daily Show, citing that their recent tiff is because of:

The gap between what CNBC advertises itself as, and what it is, and the help that people need to discern this

In fact, Stewart goes on to say that that the real problem is that the financial news media is not reporting on the markets in an ethical manner:

When you talk about the regulators, why not the financial news network? That’s the whole point of this. CNBC could be an incredibly powerful tool of illumination, for people who believe there are two markets.

Now to pretend that this was a crazy once in a lifetime tsunami is disingenuous at best, criminal at worst.. A CEO lied to you, but isn’t that financial reporting?…[Financial Reporting is when] you don’t just take their word at face value, you actually go around and try to figure it out

There are many times in life when you only hear one side of the story. For example, when the dollar drops in value, do you hear stories about how companies who export products to other countries are happy because they are making more money, or do you hear stories about companies that import products into the country who are unhappy because it costs more for them to do business? You should be hearing both stories, because both stories are relevant and true.

When you hear about Canada having an unemployment rate of 7.7%, what are your first thoughts – probably that this is a bad thing right? I was listening to an alternative music station today, and they ran a public service announcement that went something like this:

Now that the unemployment rate is 7%, the markets will crash, or will they? Did you know that in the past year we have added over one million jobs to the economy? What if an unemployment rate of 7% really meant that 93% of the population is employed?

So what am I getting at?  It’s important for you to continue to read the news, but at the same time you have to remember that there is always more than one point of view, and as a person educated in financial management you have to remember that.

This post reminds me of something I learned in business school, called “The Pig”. When you see the image of this pig, what do you think? A child might think the pig is cute, a parent might think this is dinner, a farmer might see the pig as money, and a butcher might see it as a product. At the end of the day, everyone will see the pig differently and every view is right – different people have different points of view, and just because you hear one view, doesn’t mean that is the only view.  So next time you are reading an article in a magazine, think to yourself, “How do I see the pig?”

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