Lies, and Damn Lies (With Statistics)
Gosh I really love reading Quartz. And most of the time they push some really good content that makes you stop and think.
That’s not always good.
For instance, the other day I read about how the US Student debt burden is now greater than the GDP of Australia. The Sky is falling! Right?
Not so fast. That’s not to say I would love to be burdened with a giant boat anchor of student debt, but let’s put this in perspective. We mostly think of Australia as a giant country – mostly because it is a whole continent and about the same size as the US on most globes.
This is totally misleading. The population of Australia is tiny. In 2013, Australia has a population of 23.2 million people. Whaaaaaaa? That’s right. That big giant country has a population 1/15 or so of the United States. GDP is $1.14 trillion.
Putting that in perspective, the US GDP is approaching $17 trillion, with a population exceeding 320 million. Now consider that the average student loan is 10 years. So our student loans are $114 billion vs. our GDP of $17 Trillion? Less worrisome than the headline, yes?
So this has nothing to do with business valuation, but everything to do with statistics. Check your facts. It’s easy to skew the perception with a bold headline.