Back in the early 1980s, there was a "Shoe" cartoon that showed the Perfesser leafing through a pile of papers.
"Here's the most recent survey about what our readers want in the newspaper," the Perfesser says, handing the papers to editor Shoe.
Shoe drops the survey into his wastepaper basket, without bothering to read it.
"What do readers know about newspapers?" Shoe asks in disgust.
We have become a nation of surveys and opinion polls on just about every topic imaginable. Until I got on the federal and state do not call lists, I would get at least one call a day from a survey taker, usually asking what radio station I listened to (it was never the radio station I did listen to, so they fortunately stopped after question one).
It hasn't always been this way. Back in the early 1920s, as Madison Avenue began thinking up clever ways to sell us things we never thought we needed, some guy came up with the brilliant idea of calling every Smith in the Manhattan telephone book to find out what toothpaste they used, or something along those lines.
Arthur Crossley began polling radio listeners about their favorite program so that advertisers knew if they were spending their money wisely. George Gallup did the same for newspaper readers.
Pollsters began fine-tuning their polling techniques to achieve some sort of "scientific" status, and thus make them more believable to the public. They began using polls to handicap political races starting with Herbert Hoover vs. Al Smith in 1928, suffered a serious setback predicting Thomas Dewey's victory over Harry Truman in 1948, but then recovered nicely.
The TV networks now use exit polls to try to predict who will win an election before the voting ends, leading to accusations that these polls actually influence how a person votes, or convince people who haven't voted yet not to, since the results are in no matter what they do.
Polling makes an assumption that I think isn't a good one. That assumption is that the person being polled is being honest with the pollster.
This may sound callous, but I assume that if the correct answer would be detrimental somehow to the well-being of the person being questioned, that person might not tell the whole truth.
Or at least the answer would reflect how he or she would like to see things play out.
Case in point is the survey I got the other day reporting that nearly 60 percent of 1,001 homeowners responding to an online survey expect the value of their homes to increase by at least 5 percent annually during the next several years.
I'm not a big believer in bubble economics, even though my ancestors took a bath in the South Seas fiasco in the 18th century, and we had to trade our castle for a mud hut.
I do believe in self-fulfilling prophecies, however, and I certainly would not go on the record saying that my house was going to be worth increasingly less as time goes on.
That would make me not look all that intelligent to start with. In addition, the thought that the equity of the house that I'm milking like a cash cow will be worth less than the first and second mortgage when I go to sell it would give me sleepless nights for the next several years.
It's not as if the rest of the people surveyed thought the multi-year gains would be lower than 5 percent. Twenty-four percent put the annual increase at 10 percent. Only 3 percent of those surveyed thought that their home values would decline.
Considering that recent consumer confidence surveys have recorded a decline in any positive outlook, any study with just 3 percent in the negative column is encouraging.
Perhaps the most telling result of this RBC Capital Markets' survey for me was that only 10 percent of the respondents believed that rising home values had affected their spending habits, even though 51 percent said they had either sold their home or borrowed against the equity in some fashion.
Those who disagreed most with the idea that real estate gains had affected their spending were those with an annual income exceeding $100,000 as well as homeowners who had already experienced the biggest gains in home value.
These two groups, representing 65 percent of those surveyed, also were the most aggressive in extracting that equity.
"These opinions run contrary to most data in the marketplace regarding the real estate wealth effect," said Scot Ciccarelli, RBC's managing director of equity research.
Then again, how many people do you know who are eager to acknowledge that they may be making a mistake, especially in how they are handling what for most of them is the biggest investment they have?
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