if i alert someone of the possibility of earning either 0 or 100 dollars at a coinflip by saying “the average payout is 50 dollars,” while ive said something true, ive also said something misleading. a reasonable person might say, “0, but you said i could earn 50!” and would you expect them to be mollified by me saying, “no no no, its actually only the average is 50. i was clear about this up front.” its like a student turning in their math homework and they didnt simplify the expression at the end, complaining about the teacher insisting you have to do all the work to earn full credit.
Are you implying the average person doesn’t understand averages? That’s ridiculous! I could understand the average person not understanding standard deviations and other statistical terms, but a simple average is something people deal with every day.
All the inflation figure means is how much your money is getting weaker year over year. If you take everyone’s budget, the average person will be spending that much more year over year. Individual circumstances will certainly vary, such as vegans not being impacted by egg shortages. In this case, beef supply has been reduced, causing prices to increase. This is unlikely to be a long term thing, and prices will return to “normal” (after regular inflation is taken into account) once supply returns to normal. That happened with eggs this year, prices were ridiculous at the start when hen populations were slashed due to disease outbreak, and now production has returned and prices are about where they were a year ago.
The meat shortage is a temporary thing caused by reduced herd populations and tariffs on Brazilian imports, but will likely last a lot longer than the egg supply costs because herds take longer to repopulate than chicken broods.
It’s inane to expect everything to change prices in lockstep. We use averages to smooth over distortions in one area to get a better idea of what’s going on more broadly (i.e. are increased prices part of a broader inflationary trend, or is one area seeing a unique spike?).
We use averages to smooth over distortions in one area to get a better idea of what’s going on more broadly
“we” are using a different meaning of the word average I think. When I say mean, the point is to give an idea of where the “center” of the dataset is, not what the dataset is shaped like.
Misuse of Statistics: Using numbers in such a manner that – either by intent or through ignorance or carelessness – the conclusions are unjustified or incorrect.
the often overlooked fact that the mean does not provide any information about the shape of the probability distribution of a data set or skewness, and that decisions or analysis based on only the mean—as opposed to median and standard deviation—may be faulty.
Are you implying the average person doesn’t understand averages?
That’s an interesting thing to say. Tell me more about that.
When I say mean, the point is to give an idea of where the “center” of the dataset is, not what the dataset is shaped like.
Inflation is a measure of how the value of money changes over time, and the point is to guide monetary policy to increase or decrease the supply of money. The main impact of inflation measures is to impact borrowing rates, since that’s the principle driver of money supply.
Inflation measures are not intended to measure how much eggs cost or what to expect your grocery bill to look like. It can be used for that, but a single number will never be sufficient.
A 2.7% inflation doesn’t mean everything is around 2.7% more expensive, it means that if you look at the average spending across all areas for an average person (again, not an actual person, but the mean), they will spend 2.7% more this year vs last. That could be from rent, groceries, sporting goods, etc. How much you are impacted depends on what areas you spend more in. If eggs are up and you’re vegan, you won’t be impacted much at all, but if beans are up, you’ll be impacted more than most.
Prices fluctuate for a variety of reasons, inflation just indicates how much of that is likely due to money being devalued.
Brazil is the largest exporter of meat and Trump is tariffing them 50%
so, more than 2.7% in that category. almost like that claimed 2.7% is an intentionally misleading choice of “measure” of central tendency.
Sure, and less than 2.7% in other categories. That’s how averages work…
if i alert someone of the possibility of earning either 0 or 100 dollars at a coinflip by saying “the average payout is 50 dollars,” while ive said something true, ive also said something misleading. a reasonable person might say, “0, but you said i could earn 50!” and would you expect them to be mollified by me saying, “no no no, its actually only the average is 50. i was clear about this up front.” its like a student turning in their math homework and they didnt simplify the expression at the end, complaining about the teacher insisting you have to do all the work to earn full credit.
Are you implying the average person doesn’t understand averages? That’s ridiculous! I could understand the average person not understanding standard deviations and other statistical terms, but a simple average is something people deal with every day.
All the inflation figure means is how much your money is getting weaker year over year. If you take everyone’s budget, the average person will be spending that much more year over year. Individual circumstances will certainly vary, such as vegans not being impacted by egg shortages. In this case, beef supply has been reduced, causing prices to increase. This is unlikely to be a long term thing, and prices will return to “normal” (after regular inflation is taken into account) once supply returns to normal. That happened with eggs this year, prices were ridiculous at the start when hen populations were slashed due to disease outbreak, and now production has returned and prices are about where they were a year ago.
The meat shortage is a temporary thing caused by reduced herd populations and tariffs on Brazilian imports, but will likely last a lot longer than the egg supply costs because herds take longer to repopulate than chicken broods.
It’s inane to expect everything to change prices in lockstep. We use averages to smooth over distortions in one area to get a better idea of what’s going on more broadly (i.e. are increased prices part of a broader inflationary trend, or is one area seeing a unique spike?).
“we” are using a different meaning of the word average I think. When I say mean, the point is to give an idea of where the “center” of the dataset is, not what the dataset is shaped like.
https://en.wikipedia.org/wiki/Misuse_of_statistics
https://en.wikipedia.org/wiki/Tyranny_of_averages
That’s an interesting thing to say. Tell me more about that.
Inflation is a measure of how the value of money changes over time, and the point is to guide monetary policy to increase or decrease the supply of money. The main impact of inflation measures is to impact borrowing rates, since that’s the principle driver of money supply.
Inflation measures are not intended to measure how much eggs cost or what to expect your grocery bill to look like. It can be used for that, but a single number will never be sufficient.
A 2.7% inflation doesn’t mean everything is around 2.7% more expensive, it means that if you look at the average spending across all areas for an average person (again, not an actual person, but the mean), they will spend 2.7% more this year vs last. That could be from rent, groceries, sporting goods, etc. How much you are impacted depends on what areas you spend more in. If eggs are up and you’re vegan, you won’t be impacted much at all, but if beans are up, you’ll be impacted more than most.
Prices fluctuate for a variety of reasons, inflation just indicates how much of that is likely due to money being devalued.
yeah thanks i don’t need a primer on federal reserve monetary policy from the guy who thinks “smoothing distortions over a region” and [compressing the entire dataset to a single point approximating the center of that dataset] are equivalent statements. i talked about what it was actually good for not what it is being used for.
edit: turned false quotation into paraphrase, clarity, added links
It takes so much into account that it becomes almost meaningless for the average person.
So some people will get it all, some nothing, but the average person might struggle with it?