Normandy, France – U.S. stocks showed little interest in moving either up or down yesterday.

So they just sat tight.

As we keep saying, you can get any opinion you want. The problem is you can also get any fact you want…

Lies and Misunderstandings

Yesterday, our friend and economist Pierre Lemieux challenged the numbers in Monday’sDiary
 on the U.S. manufacturing recession:

You write, ‘In real terms, the typical man of working age in the U.S. earns less today than he did in 1975 – 40 years ago.’

Where did you get this data?

Even the notably unreliable data of the Census Bureau on median family income are not that dark.

All data I know show that, in the U.S., real incomes have grown over the last 40 years. I am sure it is the same in Europe. Some prices have increased, like home prices, relative to other prices, and it is quite certainly more difficult to buy a house now than back then.

Most other things are easier to afford – including for the typical worker. This is confirmed by casual observation: Look at their cars, their TV sets, their boats, their vacations, their appliances, their restaurants (not to speak of computers).

Look at their children’s cars, iPhones, shoes, etc. Indeed, look at their hunting or hiking boots with Thinsulate and Gore-Tex!

In general, we have little confidence in numbers or statistics. Except in the world of science, where they mean something precise, they are mostly lies and misunderstandings.

Many of them are plain wrong. Many are pure inventions.

We don’t trust them – especially our own.

You’d think it would be a fairly simple matter to tell if wages, after you account for inflation, have gone up. But it’s not.

You can begin with the raw data. Then you need to adjust it for inflation… which is where the trouble comes in.

How much is a 1975 dollar worth today?

Real Earnings

We don’t want to mislead readers with faulty numbers, so we put the issue to our research team.