JULY 14, 2008

America’s Existential Crisis - Fueled by Information?

It’s easy in tough economic times like these to flip on CNBC and just watch everything collapse - connecting the dots from housing crisis to credit crunch to energy prices to food and material costs and wonder exactly how our country plans to get itself out of this mess. It’s also easy to feel powerless before a torrent of awful news streaming to your computer, television, and Blackberry 24 hours a day. We talk a lot about saturation here at TMG - but what role has it played in the economic run-up and subsequent correction?

Robert Shiller, professor and author of the bestselling Irrational Exuberance, argues that the first economy-wide “bubble” - the tech stock run-up of the late 90’s - was fueled in part by real-time stock prices and 24/7 business networks. The constant availability of information, as well as the economic cheerleading encouraged by the networks themselves, made it easier for investors to focus on minutae like price fluctuations and ignore big-picture variables like actual earnings. The irrational decisions made on the basis of too much irrelevant information helped fuel the unsustainable rise in stock prices.

Now that the financial networks are blasting bad news through every conceivable media, how many investors and business leaders are irrationally spooked about the unsteady market? How many have taken a fatalistic attitude towards their business, willing to simply ride the market conditions out to their end - whatever that end may be? What’s more, how many are listening to half-cocked pundits suggesting nice-sounding but potentially disastrous courses for their sector? My guess is quite a few.

I think we, as communications professionals, have two roles to play here:

1) We must find new angles to sell stories to an increasingly-skeptical marketplace. Exuberance for new products will be in short supply for the next few years, and to serve our clients well we must be on top of trends before everyone else and help them capitalize accordingly.

2) We must act internally, and use media monitoring to help our clients cut through the noise surrounding their business. As outsiders, we should be the ones absorbing the torrent of news and passing on what’s important, while clients should be focused on creating solid products and services. Helping our clients maintain perspective on the fundamentals amid swirling economic bad news is key to keeping morale high and eyes focused on the prize.  

I’d really like to start a dialogue here on Undercurrents about how communicators can help companies weather what may be a transformational economic crisis. If you’ve got thoughts, please comment below. If you’ve got a longer thought, e-mail me and I’d be happy to post it on this blog.