This completely blew my mind. Okay, pretend you’ve turned to the financial section of the newspaper and you’re looking at all the stock prices. Now imagine that we took the first digit of each number and fed them into a computer and counted how many times each digit (1-9) appeared. You’d expect there to be a pretty random yet equal distribution, right? Wrong. The digit “1” will appear 30% of the time, and each of the subsequent digits in decreasing percentages. “9” only occurs 5% of the time. This works for stock prices, baseball statistics, and just about any other random collection of data you can dig up. Isn’t that nuts? Apparently it also works on accounting books, which is how the IRS can tell if you’ve been fudging the numbers. Craziness. How do I know this? The Snook randomly brought it up in dinner conversation the other night and I’ve been obsessed with it ever since. Here’s a page of more information about the phenomenon. Now see if you can sleep at night.

3 Comments

Add yours →

  1. It makes practical sense when you think about it, though, because things like sports stats aren’t completely random in the sense that you have to have kicked, say, 14 goals in your career to have kicked 97, therefore for every player who’s kicked 97, there’ll be many other players who’ve only kicked 14, right? Everyone has kicked one goal, but few have kicked 9. Well, you know what I mean!

  2. You’re right, statistics like that (totals) might not fit so well. I think the article was referring more to baseball statistics than anything (that’s what we Yanks most think of as “sports stats”). Those are mostly percentages and such. But what about the fact that it DOES work for things like stock prices and numbers found in Reader’s Digest? It’s just too weird. I keep trying to come up with explanations for various examples, but it’s the fact that this theory works across so many different kinds of data that staggers me.

  3. Yeah the Reader’s Digest thing is impossible to explain. I’m scared now!

Comments are closed.