An interesting example of the way the statistics is corrupting the English
language - and hence patterns of thought. Allan seems to be thinking terms
of 'statistical independence' that has a meaning for statisticians that is
not shared by the rest of the English speaking population.
The FT experts take a wider view. Might be called a systems approach. The
FT experts know that some people have money they need to invest. If the
stock market is faltering then they put it into, say, property. But when
it appears that the property market is faltering, as many in the UK expect,
then they will put the money back into stocks where the expectation of
further faltering is lower.
There is no 'Gamblers Fallacy' here. The FT experts are part of the real
world. Like it or not, 'gambling' on the stock exchange ia a major
component of the world's economic system. It is to be hoped that
statisticians can occasionally recognise other professsional competencies
relevant to this sphere of human activity.
Ray Thomas, Social Sciences, Open University
Tel: 44 1908 679081 Fax 44 1908 550401
Email: [log in to unmask]
35 Passmore, Milton Keynes MK6 3DY
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-----Original Message-----
From: Dr Allan White [mailto:[log in to unmask]]
Sent: 07 January 2003 18:06
To: [log in to unmask]
Subject: Gamblers' Fallacy
Colleagues,
Statisticians may be amused (or upset) by a recent article in the
Financial Times last weekend. In the `Money' section, six `experts'
from the asset management industry were providing forecasts for the
stock market for the coming year. Two of these `experts' appeared to
be saying that the market was unlikely to fall far this year because
it has already suffered three bad years in succession, which made a
fourth bad year statistically unlikely.
--
Dr. Allan White, Statistical Advisory Service, University of Birmingham
Tel. 0121-414 4750 or 44750 (internal), Email [log in to unmask]
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