Returning to America's "can do" spirit

A company's stock can move on more than just its raw financial performance. As we've seen with the current downturn and those in our history,...

A company's stock can move on more than just its raw financial performance. As we've seen with the current downturn and those in our history, the whole economy can be greatly impacted by rumors, pessimism, and fear.

Our headlines are rife with grim news: an 8.9% unemployment rate; a new record forecast for banks' credit card losses. And while it's a step in the right direction, the psychological effects of Obama's "glimmers of hope" and the Fed's "green shoots" statements remain to be seen.

PR has an opportunity to bridge that gap, and step in to tap the "can do" spirit that our economy is based on - the American dream that hard work pays off.

Robert Shiller and George Akerlof capture the relationship between the economy and psychological behavior in their book Animal Spirits, in which they argue that confidence, fairness, corruption and bad faith, money illusion, and "stories" (or culture) exacerbate the fundamental forces impacting the economy. PR clearly plays a role in influencing these "animal spirits."

It is imperative for PR to be credible but also to resonate. Increasingly, companies need to recognize their respective roles in improving society and to illustrate their contributions-provide reason for us to believe.

PR is most convincing when it is based on facts and the reality of the environment we are living in. Yes, the global economy is facing tough times. But hopes and aspirations are also key to putting us on the path forward toward recovery, as illustrated by the "animal spirits" theory. PR deserves a seat at the table in facing the great challenges of our times. PR can rally people, restore confidence, and remind us that, yes, we can.

Kathy Bloomgarden, co-CEO of Ruder Finn

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