Sentiment, Schmentiment

Everybody’s worried about surveys these days. Consumer sentiment, inflation expectations, voter leanings—seems that you can’t eat dinner without a canvasser calling up and asking your opinion.

The obvious question is, why. Why do pollsters care about my political views? Why should a government statistician care whether my neighbor is depressed about the economy? In theory, plans and intentions lead behavior. But life is messy. And theory rarely works.

Consider farmers: their incomes have increased dramatically, and many of them intend to upgrade their equipment this winter after the harvest comes in. But if a flood or hailstorm intervenes, those plans are gonna change mighty fast.

That’s why I much prefer hard numbers to surveys and sentiment. If I want to really know how my buddy feels, I can look at what he’s buying. And if he’s loading the boat with a new TV or ATV, you can bet that times are pretty good.

So far the hard data show a middling course. They sure don’t indicate the doom and gloom of the surveys.


Douglas R. Tengdin, CFA
Chief Investment Officer
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