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Opening Arguments


I think I've mentioned several times here to be suspicious of stories using a lot of percentages -- it probably means the raw numbers weren't scary enough, and you are being misled. Here's a good example from The New York Times:

The portion of people who have home equity lines more than 30 days past due stands 55 percent above its average since the American Bankers Association began tracking it around 1990.

But the numbers went from what to what to achieve that scary 55 percent? What was that average used for the baseline? is the way Tom Maguire at JustOneMinute asks the question: "If delinquencies have moved from 2% to 3%, that would be a 50% increase, but maybe not so scary.  And since the reporter resolutely provides no other context, suspicion is warranted." So he did a little digging, and found that the average used was not 2 percent. "The percentage of HELOC accounts that were more than 30 days past due rose 14 basis points to 1.10 percent during the first quarter (seasonally adjusted)."

Posted in: Current Affairs


Harl Delos
Fri, 08/15/2008 - 4:22pm

Suspicion is always warranted.

It's hard to write a story that doesn't reflect your world view, but on the whole, reporters do a remarkably good job of trying to be fair.

On the other hand, reporters are in a hurry, and it's a lot faster to do a superficial job.

Tom Maguire points out that 1.10% of the Home Equity Line of Credit loans are currently late, compared to 0.96% last quarter, which is an increase of 14 basis points. That indicates that the problem is worsening. The original figure of 55% indicates that the average figure was 0.70% over the past two decades. Without both numbers, it doesn't really reflect the situation: a situation that's continuing to deteriorate.

The other side of the coin is that HELOCs are in terrific shape compared to mortgages. One in every 464 US homeowners received a foreclosure filing last month.

It would be helpful, though if more reporters were smarter about numbers. Most of them barely understand enough mathematics to operate a parking meter.

tim zank
Fri, 08/15/2008 - 7:20pm

I love statistics. For instance, If I recall correctly, I recently saw every 30 seconds someones identity is stolen. If that were accurate, no one would have a frickin' identity in this country in about 8 years....period....based on 300 million citizens.

I've heard the statistic for years, that every 3 minutes, a woman is raped in America. If that's accurate, there are obviously no women in America by now that have NOT been raped......I've heard that one for 20 years at least...there aren't enough women to satisfy that equation (no pun intended).

My point is, statistics and polls are manipulated to encite whatever fear you may to exaggerate at any given point.

They'll give you SOME insight as to trends, but they are FAR from being a baseline.

Bob G.
Sat, 08/16/2008 - 11:55am

And don't forget, Tim, every EIGHT SECONDS, a car is stolen (now you're at the window, right?)
OOPS, gotta run, MY 8 seconds are up too!



Phil Marx
Sun, 08/17/2008 - 11:45am

Here's an example to show how percentages can easily be used to manipulate the facts.

Let's say that a state's sales tax was originally at 3%, was later raised to 4%, was raised again to 5% in 2007, and is now at 6%.

It would be accurate to say that the tax increased 33% the first time, 25% the second time, and only 20% the third time. Yet this gives a false impression that belies the fact that with each increase, every dollar spent will cost you exactly one more cent than before.