Thursday, March 27, 2008

I love headlines

OK, I typed this post and then decided against posting it. First the Trib has a headline today: "Foreclosures in Pittsburgh region in February hit 22-year high" which I have no reason to dispute in and of itself. I was going to quibble with the discordance I see between the headline and the data being reported. I figured I would be just ranting over a single article, and then the Pgh Biz Times has this article on same: Foreclosure flood in Pittsburgh region.

(update: can't let PG off, they now have their version as well, though it does have one sentence of moderation in there. As an aside, I worry a bit about commentators trying to make up for lost time, which could be as harmful as missing this story for the most part in the first place. The media has started it's own introspection on this. See: Where Was Media When Sub-Prime Disaster Unfolded? I actually don't understand why there has been no media coverage at all, locally or nationally, looking into the reasons why local foreclosure rates across SW Pennsylvania are barely a fraction of what they are just up the turnpike in NE Ohio. There has to be an important story in that. Earlier this year I blew up a map from the Atlantic Monthly which really highlights that contrast.)

Flood? Since neither article has much context with other regions across the country, you have to wonder what readers will take away from reading either version.

So I read the Trib version to see what constitutes a '22 year high'. According to the article, the total number of foreclosures in a 5 county region here over a 2 month period (Jan and Feb of this year) was 742 total foreclosures which was higher than the previous 2 month high of 708 over a comparable period in 2005. So 4.8% above a comparable period 3 years ago which arguably was before the current foreclosure crisis really began to percolate. Is that saying foreclosures here are remarkably high, or remarkably close to what the normally are all while rates are shooting up astronomically everywhere else.

So the headline may be true, but does it really mean local foreclosures are shooting skyward as might be inferred. I wonder how many more foreclosures there are in Cleveland over the last few months compared to a period 3 years ago. I bet its not +4.8%. Move the decimal point to the right and then some. According to this article, Cleveland's foreclosures are up +112% just in the last year. I bet the headline there could be something like this every month: "Foreclosures in Cleveland hit XX-year high"... just pick your value for XX each and every month. They might even be a the point where they skip the 'XX years' part and just say 'ever'. We are just quibbling over whether the current number is higher than what took place in that benchmark year of 2005.

Then you get into some small number fallacies. Some of the county level numbers cry out for parsing: "Allegheny County had a 32.9 percent increase with 222 in February vs. 167 for the same month last year". OK. bad for those 222 folks no doubt. But 222 foreclosures... again from that article below Cleveland had 49,071 foreclosure filings in 2007. I am too lazy to go dig up numbers for Cuyahoga county, but the scale is clearly different. Or for other counties in the region it gets better. Another quote: "Butler County had the highest increase with 24 in February of this year compared to 8 in 2007, a 200 percent jump. ". Umm. 8 to 24 in a county with how many households in the county? Yes, that does represent 200%, but amid the worst foreclosure crisis (actually have there been past 'foreclosure' crises?... economic crises for sure...) Butler County counts all of 24 foreclosures. If the number of foreclosures jumped from 1 to 3 would the sentence still decribe it as a 200% increase? If not, how small is too small for fairly reporting percentage changes? You might say, ok but Butler county is more affluent than most elsewhere in the region and any foreclosures are telling. But that is in fact the point about what is going on nationally. The foreclosure crisis has become such an issue because its not just folks at the lowest income strata being impacted, but in Cleveland and other places a real foreclosure crisis has clearly extended into middle income and affluent households as well.


Anonymous Anonymous said...

Pittsburghers are pessimistic about Pittsburgh. Period. If it is bad in the U.S., it must be worse here. Only here could the business press take a good news story--"Look how low our foreclosure rates are"--and turn it into a bad news story. I've written to many of the local business reporters suggesting that they look at the brighter aspects of the economy, but they seem to stuck on reporting only the bad news.

Friday, March 28, 2008 1:11:00 PM  
Anonymous Anonymous said...

Exactly. The local media has been waiting to pounce on some data that they could use to proclaim that Pittsburgh is clutched in the deathly throes of the foreclosure crisis. Quite simply, it's largely a non-issue here at the moment.

Friday, March 28, 2008 7:10:00 PM  

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