Tuesday, September 29, 2009

Incorrect Claims Incorrectly Corrected by Kimberly Clark

Talk about a tongue twister! Just try saying that 10 times fast. That's not all that's twisted though. The math is too, and spun!

April 11, 2007
Toilet paper price rise claims incorrect

Recent media reports of a 103% price rise in toilet tissue are incorrect and are based on a misreading of Australian Bureau of Statistics (ABS) data by Family First researchers in Senator Steve Fielding’s office.

Kimberly Clark's correction is also based on a misreading of the data. You'd think they'd be extra careful knowing that there had already been one statistical mistake, but alas, that was apparently not the case.

In 2004, the ABS quoted on a 4 roll pack of toilet tissue, but in 2006 it used an 8 roll pack in its statistics.

Kimberly Clark didn't feel the need to point out that the 4 roll pack had 220 sheets per roll, but the 8 roll pack only had 190 sheets per roll. Surely they should have noticed. I did and I'm not even a toilet paper expert (although some might disagree, lol). The data clearly shows it. No digging deep required.

In reality, price per roll of toilet tissue has changed by 6%...

In reality, that is true. But in practice, the rolls are not the same size so it is actually a completely useless statistic. In fact, it is every bit as useless as the original claim by the media.

In December of 2004, "Toilet paper (4 x 220 sheet rolls)" cost an average of 305.375 cents in 2004. (I simply averaged the prices in the 8 cities provided.) That's 0.347 cents per sheet.

In December of 2006, "Toilet paper (8 x 190 sheet rolls)" cost an average of 649.25 cents in 2006. That's 0.427 cents per sheet.


That's a 23% increase per sheet in just 2 years. That's an average increase of 10.9% per year.

Kimberly Clark was rightfully concerned about the first statistical mistake. The number of rolls was not held constant. The outlandish inflation claim by the media made Kimberly Clark look worse than they really were.

Kimberly Clark had no problem whatsoever abusing that VERY SAME type of statistical mistake. The number of sheets was not held constant either. By not acknowledging it, Kimberly Clark made Kimberly Clark look better than they really were.

There's a word for this behavior. It's called hypocrisy.

Fortunately, governments do account for the quantity of an item when determining consumer price inflation. Unfortunately, the same cannot be said of the mass media and/or Kimberly Clark it seems. Two wrongs clearly don't always make a right.

As scary as this sounds (and believe me it is scary), I trust government more than I trust the mass media and/or global corporations. That's not really saying much though. Sigh.

And lastly, sorry Australia. Apparently you should have stocked up on toilet paper in 2004 when you had the chance.

4 comments:

  1. This comment has been removed by a blog administrator.

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  2. Stag,

    "Life is like a roll of toilet paper. The closer it gets to the end, the faster it goes." - Andy Rooney

    You could say the same thing about ponzi schemes.

    I not expecting high or runaway inflation any time soon. I just don't see it against a backdrop of stagnant wages and falling house prices. That said, there are other benefits to hoarding or buying in bulk. For one, it saves lots of time. Just think of all the future trips to the store that you've hoarded. Plus, you've reduced your future travel expenses (less future driving required). For many people shopping is recreation. To me it's a drag.

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  3. mab,

    The risk of inflation, in my opinion, comes solely from our trade deficit. We keep shipping paper dollars in exchange for real goods. China is now sitting on a LOT of paper dollars. If that can't continue long-term then we better figure out the mechanism that makes it stop before others do.

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  4. mab,

    I also wanted to comment on your "reduced future travel expenses" comment. That's the real benefit of hoarding in my opinion. If I visit Costco, I always try to make sure my car is packed (or I do not go).

    It is one reason that I always made sure to buy extra toilet paper and paper towels when visiting Costco (as a bear).

    It isn't cheap or efficient to transport 45 rolls of toilet paper from Costco. If the day ever did come when prices started to rise substantially, it would have taken a LOT of extra trips to hoard as much paper as I have. Toilet paper can take up a lot of space in a car.

    However, by always making sure my car was packed when buying the things I needed anyway, the toilet paper mostly just got a free ride to my house. I never bought more than one 45 roll pack at a time. It just accumulated over the years.

    Costco is roughly 10 miles from my house. I figure it costs me roughly $10 to make the trip (gasoline, car maintenance, ...).

    If oil prices continue to rise over the long-term, it is much better to be packing the car using today's oil than with tomorrow's oil. Of course, this only makes sense if one leans towards a long-term stagflationary mindset, which I do.

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