Regarding yesterday’s New Home Starts, an emailer writes:
You used to discuss the Commerce Dept.’s standard statistical error regularly. In light of that surprising Housing Start number, could you please update that?
Sure thing. I love this sort of data sifting exercise. (I used to do this all the time, but I could actually hear readers falling asleep through my screen).
Let’s go to the Census Department release.
Privately-owned housing starts in April were at a seasonally adjusted annual rate of 1,032,000. This is 8.2 percent (±14.5%)* above the revised March estimate of 954,000, but is 30.6 percent (±6.7%) below the revised April 2007 rate of 1,487,000.
As is so often the case, the devil is in the details:
As far as the April Hosuing Starts go, a monthly change (seasonally adjusted annual rate) was 8.2%, versus an
estimated relative standard error of ±14.5%. Hence, the monthly change is not statistically significant; that is, it is uncertain whether there was an increase or decrease in Housing Starts from March to April.
As to the 30.6% year over year drop — that is ±6.7% — and therefore is statistically significant.
[UPDATE: Flenerman in comments asks the same question]
And I thought I was the only one who cared about such mathematical trivialities . . .
NEW RESIDENTIAL CONSTRUCTION IN APRIL 2008
Manufacturing and Construction Division
U.S. Census Bureau, MAY 16, 2008 AT 8:30 A.M. EDT
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.