Having your cake and eating it: the numbers edition

First, Greece was involved in a web of lies relating to its financial situation. Then, it spread to the rest of Europe, trying hard to pretend that the center will hold. Now, the bystanders are partaking in the game of who's the most brazen when it comes to abusing numbers.

According to Bloomberg, the economist Ken Rogoff said this:

There’s at least as much as an 80 percent chance that Greece will leave the 17-nation common currency in the next 10 years.

How should we read this prognostication?

Does he mean

There’s at least an 80 percent chance that Greece will leave the 17-nation common currency in the next 10 years.

in which case, the probability is between 80 and 100 percent, or does he mean

There’s as much as an 80 percent chance that Greece will leave the 17-nation common currency in the next 10 years.

in which case the probability is between 0 and 80 percent,

or is he combining both cases, in effect, making a prediction of 0 to 100 percent?

Taking things further, the headline writer at Bloomberg puts his/her own spin on things. The headline tells us:

Greece will eventually leave the Euro, Rogoff says

Way to turn a probability into a certainty!

 

 

 

Comments

[Hasan Diwan]

Duh... Nothing lasts forever. How much does Bloomberg pay its headline writers again? :)

[Ken]

Rogoff is one of the more sensible economists (he is one of the authors of This Time Is Different: Eight Centuries of Financial Folly), which shows how bad economics has become, when the better ones still make stupid comments. You could simulate the economy and then find 80% of simulations exited but we can't build things that good. In the end he is simply trying to qualify his prediction, which means whether Greece exits or not, he will still be right.

[Mark T]

looks like you need a spam filter!