Episode 12: Some percentage of this is wrong

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Ah yes, summer is coming and the weather is getting warmer, well, its supposed to get warmer.  I think it was warmer a few weeks ago, then spring turned back into fall.  But I hear summer is still on schedule to happen sometime soon.  And when it does we’re gonna need some burgers.  Nothing says summer quite like a juicy thick pile of ground meat mixed with spices, maybe some onions, cheese, bacon …. would you excuse me a bit?  Focus, man focus!  Hamburgers are great and a real symbol of summer. 

Around here, we like a decent 6oz patty.  That’s right, none of that wimpy quarter pounder nonsense.  Only real hamburgers need apply.  No bought burger can hold a candle to a good home made one either.  One day, as we’re mixing a batch of meaty goodness while the grill heats up my wife says to me that just this time we can make the burgers 25% bigger but forever after we’ll have to make them 25% smaller.  More is always more, so who wouldn’t say yes.  That’s now 7 ½ ounces of scrumptiousness ready for grilling, toppings and a bun.  Here I come!

Let me tell you, the bigger burger was good.  Always go for more.  Later, of course, came to make another batch and true to the deal we weighed out some patties that were 25% smaller than the previous behemoth. Bit of math and a scale and we made several 5.6 oz burgers.  Hold on a sec?  5.6?  How’d I lose almost half an ounce of meat?  Did we forget something?  Maybe the spices now had antigrav properties?  What sorcery was this?  Give me back my .4 oz of lean ground beef right now!  Is this even legal?

Turns out I got caught in a shifting baseline trap.  You see, I started with a 6oz burger that was made 25%, or 1.5 oz, bigger.  That gave me the big 7.5 oz beast.  Then we shrank the 7.5 oz heaping pile of meat by 25%, or 1.875 oz, which leaves us with a scant 5.6 oz diminutive excuse for a real burger.  The baseline started at 6 oz, then shifted to 7.5.  How could I have been so careless?  Can I make up the missing amount with potato salad?

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This bit of trickery is extremely prevalent, especially when it comes to money.  Let’s look at another hypothetical situation.  Say I have $100,000 in a 402K (it’s just like a 401K, but one better) and the market tanks taking away 25% of my savings (markets are fickle things).  That leaves me with $75,000.  Simple wisdom would say that if the market rebounds and recovers it’s 25% loss, then I’m fine.  But I’m not because I only regained 25% of my $75,000 or $18,750 for a total of $93,750.  In order for me to get back to my original $100K, the market would have had to jump about 33.5%, not 25%.  This gets even more confusing and worse when the market comes back 25, then loses 5, then regains 3, loses 4, gains 6.  At the end of all this, are you ahead or behind? 

Similar to this are cases where the baseline doesn’t so much move we’re just not told what it is.  This is a great tactic to cause some totally misleading fear.  For instance, take my hamburger insurance that protects me in the event I get a bad burger (it happens and we need to stay prepared!).  Due to a controversial ruling in State vs Edgar P. Frivolous regarding the improper compression of patty-ified meats there is now a 17% increase in all burger insurance plans.  17%, how could they do this?  That’s an outrage!  Destitution, here I come.  The truth is my insurance is 3 cents per burger and 17% of 3 cents is about ½ of a cent.  Not very much is it.  Hearing that my rate is climbing by 17% is way scarier than a report of a half cent increase.


Shifting and hidden baselines are certainly tricks to watch out for.  Look around as you go about your day and I’m sure you’ll notice some.  Turn on the news and wait 5 minutes, it probably won’t take much longer (especially if there’s a healthcare or tax debate).  When you learn to spot them, they are easy to avoid.  When you learn to avoid these, you can keep your burgers large and your insurance low.  For now, I’m going to see if I can make up the difference with bacon.