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http://www.tinsa.es/down/IMIE/2011/IMIE_08_2011.pdf
General: -6.8% (July -6.4%)
Costas: -7.1% (July -9.5%)Peak (Dec2007) to present:
General: -23.5%
Costas: -29.2%More of the same really.
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Re: Cumulated index for Costas in Aug (-29.2%) is less than for July? How could it happen?
Following brianc_li and Tinsa, the prices on Costas in August decreased by 7.1%, so that the cumulated since Dec07 decrease reached 29.2%.
@brianc_li wrote:
http://www.tinsa.es/down/IMIE/2011/IMIE_08_2011.pdf
General: -6.8% (July -6.4%)
Costas: -7.1% (July -9.5%)Peak (Dec2007) to present:
General: -23.5%
Costas: -29.2%However, if one looks at July Tinsa data (brianc_li’s post of 12 August):
“I’m a little bit late with this.
http://www.tinsa.es/down/IMIE/2011/IMIE_07_2011.pdf
General -6.4% (June -6.6%)
Costas -8.6% (June -8.7%)Peak (Dec 2007) to present:
General -23.2%
Costas -29.5%”one will see that the cumulated decrease since Dec2007 was already -29.5% , i.e. higher than the August number.
Could someone please explain or comment on this seeming inconsistency, when the Costas prices continue decreasing in Aug, while the cumulated decrease becomes smalle.
Thank you,
Tim
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To be honest, it confuses me as well but there is apparently an explanation. Something to do with the relative monthly falls between this month and the same month last year.
The one person I know who understands it fully is Edward Hugh the Barcelona based economist. If you want, I’ll post your query over on his Facebook page. Let me know.
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I guess they are quoting year on year changes, which can be misleading. In fact prices could have risen from July 2011 to August 2011 but the year on year price for August 2011 could still have fallen.
e.g. consider these (obviously made up) figures:
July 2010 price index = 100
Aug 2010 price index = 98July 2011 price index = 90
Aug 2011 price index = 95So the yoy change for July 2011 is -10, and the yoy change for August is -3, even though the price index actually rose by 5 from July 2011 to August 2011. These distortions often happen when there is a sudden movement in prices during a few months of the year, and they affect all the yoy figures for 12 months until they “fall out”
BTW it’s a similar story with inflation figures, which are also quoted as year on year. E.g. UK VAT went up to 20% at the beginning of 2011, so year on year inflation is running high. In Jan 2012 that sudden increase should fall out and the UK inflation figure should drop back down. (It’s all a bit smoke and mirrors)
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@brianc_li wrote:
To be honest, it confuses me as well but there is apparently an explanation. Something to do with the relative monthly falls between this month and the same month last year.
The one person I know who understands it fully is Edward Hugh the Barcelona based economist. If you want, I’ll post your query over on his Facebook page. Let me know.
2 brianc_li: Oh YES, I’ll appreciate if you do ask Mr Edward Hugh. I’m interested in knowing more about TINSA index calc. Thanks a lot.
2 katy: Thank you the refr to an interesting article -will read it tomorrow.
Regards,
Tim -
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Edwards response…….
=============================Hello Brian,
Sorry I have been so long getting back, but I have been away, and not able to access Facebook. Looking at the thread I think Chopera has it right, it is simply about the difference between year on year and month on month. Prices could rise on a monthly basis and still fall on an interannual one. Evidently in any month where the inter monthly is up the fall from peak is down.
Hope that helps,
Edward
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Edwards response…….
=============================Hello Brian,
Sorry I have been so long getting back, but I have been away, and not able to access Facebook. Looking at the thread I think Chopera has it right, it is simply about the difference between year on year and month on month. Prices could rise on a monthly basis and still fall on an interannual one. Evidently in any month where the inter monthly is up the fall from peak is down.
Hope that helps,
Edward
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