Gosh, Christmas was almost ruined, wasn’t it?
I’ve been following the Air New Zealand strike action with a great deal of interest.
Newshub first revealed that the event was ramped up from one day to three: 21, 22 and 23 December. How inconvenient and aggravating! And then today, in a sudden twist, it was announced that the planned strike had been called off — at least for now.
Whew. Many Kiwi travellers must be breathing a sigh of relief…
The unions representing Air New Zealand’s engineering and logistics workforces originally served the three-day strike notice in retaliation to Air NZ’s ‘low offer and requests for cuts to sick leave and overtime.’
Now, I’m all for employees negotiating for better pay and benefits. In fact, during a period of low unemployment — when employees have relatively higher power — it’s the logical and perhaps responsible thing to do.
But this strike could have affected upwards of 100,000 hard-working Kiwis…none of which had any power to resolve the situation.
They became hostages.
Having dished out big bucks for prime tickets, these customers just wanted to get home for the holidays to spend time with family.
And unionised workers schemed to take these Christmas travellers hostage while demanding a ransom from Air NZ.
Feels dirty. But maybe I’m completely off-base. Let me know what you think of this ongoing story at firstname.lastname@example.org
Communicating clearly is hard
As I read more about this Air NZ strike situation, it seems as if the unions are struggling to clearly communicate why they’re doing it.
Sure, they’ve given a couple of bullet-point ransom demands…but they’ve utterly failed to garner any public support.
If only they could say something like, ‘We work all day on the hot tarmac, wearing threadbare hand-me-down hi-vis vests, making 27% less than our counterparts at other airlines…all just to be refused sick leave when we’re bedridden with the flu.’
Then it might be easier for people to sympathise. But they haven’t done that…
And the result is that many folks feel that the unions are in the wrong…as I do.
It’s a testament to the importance of communication.
I’ll be quick to admit that my colleagues in the finance and economic sectors are repeat offenders when it comes to poor communication.
Explaining how money works can be simple, and yet most analyses I read are chock-full of jargon and academic terms.
For example, here are a few suggested topics for the RBNZ-sponsored Conference on Macro-Finance held in Wellington today and tomorrow:
- ‘Influences of time-varying risk premiums and precautionary savings on financial markets and the macroeconomy
- ‘Inferring macroeconomic expectations embedded in financial market variables
- ‘Resolving exchange rate and equity risk premium puzzles from macroeconomic expectation and risk perspectives
- ‘Monetary policy transmission into financial markets and the macroeconomy’
Now, you might say that picking on the RBNZ is too easy…and you’d be right. Central banks are notorious for making up fancy-sounding mumbo-jumbo like the topics above.
But that being said, it’s a real problem — the failure to communicate well.
Here at Money Morning New Zealand, we try to talk about urgent financial ideas in a way that most people can understand. Why? Because we believe it’s crucial for all Kiwis to be aware of the forces affecting their wealth.
That’s why we’d translate something like ‘Influences of time-varying risk premiums and precautionary savings on financial markets and the macroeconomy’ into ‘What do Kiwis do when times are good?’
The answer? Some get a tad overconfident with their investments when they’re making juicy returns. Others choose to save what they can. Eventually, the cocky folks drive the market over the edge…and the savers bring it back to life.
It doesn’t have to be that complicated…but lots of folks struggle to communicate their ideas clearly.
If you’ve seen Dragons’ Den, you’ve probably seen some really smart inventors lose out on big investments from the Dragons because the inventor simply failed to explain the idea in an understandable way.
Or perhaps scientists who see a problem on the horizon — like climate change or some species going extinct — but can’t rally the public because they struggle to explain it in layman’s terms.
Or politicians running for election who have some potentially great ideas but can’t word it in a way that resonates with people.
Now, some might suggest that it’s a mark of intelligence. The folks at the RBNZ coming up with those ridiculous themes are simply smarter because they use fancy words.
One of the smartest, most important experts in the financial world is Warren Buffett. One of his top quotes is:
‘In the business world, the rear-view mirror is always clearer than the windshield.’
What a brilliant statement…and there’s no mention of ‘time-varying risk premiums’ or ‘precautionary savings’.
It’s just simple truth…said in a way that anyone can understand.
That’s our goal here at Money Morning — Simplify and demystify.
Because the world of money is an exciting place! And we’re living in an incredible time. It’d be a darn shame if any of us were to miss out on the opportunities available to us (Or fall victim to the threats) simply because no one explained it in a reasonable way.
As the moustached genius himself allegedly said:
‘If you can’t explain it simply, you don’t understand it well enough.’
Editor, Money Morning New Zealand
PS: Thanks to the readers who shoot me a quick note when I don’t explain something well…or use jargon myself. I appreciate your watchful eye…and your thoughtful recommendations on ways to improve this letter. Keep ‘em coming!