It is Obvious

Chris Rick has got altogether too much to say

The numbers game

Posted by chrisrick13 on March 31, 2010

It is obvious: numbers are tricky things.

I think I have said that once or twice before.

The GDP growth for the last quarter has been revised up from 0.3% to 0.4%.  I had quite expected another round of excited shouting from Labour in general.  How clever we were to get such a good recovery.  Told you so.  Our growth predictions are correct.  I have heard nothing.

The reason for this is that the shrinkage for the previous quarter was revised down from 0.6% to 0.7%.  If you read Stephanomics then you will be familiar with the term “a steeper recession, but a faster climb out”.  I would be happier with “a deeper recession, but a faster climb out”.  I am disappointed at that her subtle change of words gives a very different picture to the reality.

Why?  If the movement is is 0.6% down and then 0.3% up the position is 99.6982% of where we were before then.  If the movement is 0.7% down and then 0.4% up we are 99.6972 of where we were.  The figures are showing a worse position in absolute terms.  Small numbers and at that level surely the error swamps the result, but it is £1.4bn of GDP that we didn’t have after all.

It is obvious: numbers are tricky things and we just don’t have the time to tie them all down.

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