Explanation of the Science

Motto:

"First they ignore you, second, they laugh at you, then . . .

. . . I hope it’s ‘then’ now . . . "

Non-Subjective Valuing^Ž

The End of Consumer Reports/J.D. Power Type Biased "Valuing."

Article by inventor/patent holder, Tommy Vig.

Š Tommy Vig 2004

Using greatly oversimplified imaginary facts and numbers, this is how Non-Subjective ValuingŽ is done. The essence of this invention is the NORM, the assumed unit which is average in its qualities and price, to which all existing units are compared. The paperback, HOW TO TELL WHAT THINGS ARE REALLY WORTH, contains the greatly detailed explanation of the science, enthusiastically recommended by world famous economist, Arthur Laffer, of the Laffer Curve and professor Michael Scriven, author of VALUING THESAURUS.

HOW TO TELL WHAT THINGS ARE REALLY WORTH is available at Amazon.com and all bookstores.

The below introduced method may of course be used by individuals, in which case the system is naturally subjective, but ultimately resolves this (until now unanswerable) question:

IF YOU KNEW AND UNDERSTOOD EVERYTHING YOU WANTED TO KNOW AND UNDERSTAND ABOUT THE AREA YOU SELECTED, THEN HOW WOULD YOU RANK THE AVAILABLE CHOICES IN THAT FIELD?

What happens on this site on the current Home Page is this:

If you do not enter your unique preferences (0-10, 10 being most important), then upon clicking on " CALCULATE !"- in seconds, the default results provide you with the pecuniary value of each SUV, to the hypothetically ideally informed Average User!

1. Through carefully designed questionnaires to the demographically correct cross section of our society, we learn all the qualities for which a target subject is presently recognized by the community. (Could be attributes of dentists, toothpastes, department stores, online vendors, cities, senators, policies, economists, movies, movie reviewers . . . not even the sky is the limit). For this example, we will use Sport Utility Vehicles.

There are about 300 things we, the people, consider about them. (Please see the list on this site under QUALITIES’ INVENTORY)

2. Through a second, scientifically made up inquiry, to the demographically accurate cross section of our community, we learn how relatively important each property of the object is to us. For brevity, let’s use only 3 attributes of SUVs for this example, not 300 or 3000, say: RELIABILITY, ECONOMY and SAFETY.

By allowing the respondents to rate each such attribute for importance, 0-10, 10 being most important, we shall have an average count of importance for each attribute. Since all things consist of 100% of their currently discoverable qualities, and pretending for this example that SUVs have only 3 qualities, here is how the math goes.

3. Suppose we get the following averages from the populace:

RELIABILITY 9,

ECONOMY 7, and

SAFETY 8.

Non-Subjective ValuingŽ translates such relative importance ratings into slices of pies, or percentages, as follows: 9+7+8=24, or

RELIABILITY 9:0.24=38%;

ECONOMY 7:0.24=29%;

SAFETY 8:0.24=33%. (Whatever number of characteristics we measure, make up 100% of what an SUV "is").

In this hypothetical example, to our current society, these SUV features are found to be important to the following degrees: RELIABILITY=38%; ECONOMY=29% and SAFETY=33%.

4. Non-Subjective ValuingŽ scientific research measures the hypothetically exact average SUV’s parallel characteristics.

By evaluating the level of RELIABILITY, ECONOMY and SAFETY of all SUVs, and discovering the average RELIABILITY, ECONOMY and SAFETY for such vehicles, the method assigns the identified averages to a non-existent, NORM, or "100%" SUV, which abstractive vehicle becomes the yardstick for Non-Subjective ValuingŽ.

This assumed standard/model vehicle is average as to all its contemplated characteristics, and most important, it is accurately calculated that if such SUV existed, for exactly how much money it would currently sell in the market place.

5. Continuing to greatly simplify the explanation of the science, let us suppose that we learnt that the

100% (or average) RELIABILITY consists of an SUV breaking down 10 times during the first 5 years of its life;

its gas consumption (ECONOMY) turns out to be 20 mpg; and

national accident reports show that 120 individuals die each year in the average Sport Utility Vehicle.

We also know from price averaging that our society is currently willing to pay $22,000 for the assumed, exact average SUV.

6. This means that the typical American pays out

38% of $22,000, for average reliability;

29% of $22,000, for normal economy; and

33% of $22,000, for regular safety.

Now we have our YARDSTICK SUV, based on nothing but the undiluted facts. his criterion allows us to establish ratios. We can now compare isolated qualities of a particular vehicle to the NORM, then PRORATE such qualities accordingly. Pure proportionality is an essential feature of this new valuing system, which (due to combining in a systematic way the quantifying of values obtained from a carefully designed survey of societal preferences) is independent of any point of view. Deviations from the NORM proportionately affect each vehicle’s pecuniary worth in terms of the preferences of a hypothetically ideally knowledgeable community.

Communally speaking then, we pay $8,360 for normal reliability;

$6,380 for average economy; and

$7,260, for normalized safety . . . these dollar amounts corresponding to the parallel percentages representing the societal importance levels of the three in-play qualities.

7. Once we measure a Test SUV, (that is, a real one), and compare its characteristics with those of the hypothetical NORM (average) SUV, we get a perfectly valid dollar worth number, mirroring the true pecuniary VALUE of the Test vehicle, regardless of its price!

8. Using primitive math, it goes like this.

Say that the Test SUV sells for $25,000 and measures up as follows: It is confirmed that generally,

it breaks down 8 times during its first five years of its life, making it about 25% more reliable than average, or we must add 25% of $8,360 to its value, concerning that one quality (or plus $2,090, for its reliability advantage);

it will only travel 15 mpg, or less (worse by) 25% of $6,380 (or minus $1,595 for this Test vehicle’s economical disadvantage); and finally, in our example, we learn that

in the Test SUV, 60 individuals die each year, making it 50% safer than average, or worth 50% more than $7,260, which is the amount of money we pay for normal safety, adding 50% of $7,260 (or plus $3,630), to the Test vehicle’s value.

9. When we calculate

plus $2,090,

minus $1,595 and

plus $3,630, it turns out that our particular Test vehicle is worth $4,125 more than the NORM vehicle, or $22,000 plus $4,125, equaling $26,125.

What this vehicle sells for ($25,000), can now be compared with what it’s worth ($26,125), or we learn that our Test SUV is in fact underpriced by $1,125, or 4.5%!

IN OTHER WORDS, HAVING EMPLOYED NON-SUBJECTIVE VALUINGŽ, THE FOLLOWING QUESTION IS QUICKLY ANSWERED:

IF WE SUDDENLY KNEW AND UNDERSTOOD EVERYTHING WE WANTED TO RECOGNIZE AND INTERPRET ABOUT A REALM, HOW WOULD WE THEN RATE/RANK THE VARIOUS ENTITIES - OBJECTS - INDIVIDUALS - GOODS - SERVICES - IDEAS - POLICIES, ETC., IN THAT FIELD?

THAT IS, BEING PERFECTLY INFORMED, INEVITABLY YIELDS TRUE VALUE™!

Non-Subjective Valuing^® is thus the patented and patent pending method that sets forth the only procedure scientifically to unearth the genuine monetary value or rank of something, independent of its price, market value or reputation. Incredibly and for the first time ever, it resolves the question man has tried to answer forever: What is something worth?

The method and know-how are licensable from patent owner Tommy Vig by contacting:

Some examples for valuing include the scientific finding of the current monetary worth or ranking of a heart transplant by a certain surgeon, a tooth pulled by a particular dentist, a specific used car, a given government policy, research project, a philosophy, a respective box of cereal, or a computer or software product, a web site, a city, a neighborhood, house, work of art, employee, employer, an official, a candidate, a ballot proposition; or the dollar worth or regional or national ranking of a distinct HMO, car rental agency, professor, airlines, student, supermarket; or the precise chances of a particular horse to win a certain upcoming horse race, the ranking of a newsman, university, vacation, mountain climbing experience, fraternity, success: you name it.

The important thing is that Non-Subjective Valuing^® distinguishes market price or popular perception from true value, and quickly answers the question: If you suddenly knew and fully understood everything you wanted to know about the probed subject, how would you appraise it then?

The results are not the opinion of the inventor, or a consensus of experts, a plebiscite, meaningless popularity contest, market research, or any other worth-determining procedure known until Non-Subjective Valuing^® was invented.