Correlation Does Not Imply Causation

“His argument was presented with data so it must be correct.”

I stopped watching the news on TV years ago. I think it was the invention of the 6 box debate with everyone yelling at each other all-at-once. Or maybe it was when I watched a new reporter cut off Warren Buffett to tell the audience what he thought about the markets. It was so long ago I don’t remember. This was around the time that the news became entertainment, rather than news.

Despite my distaste for TV news, I was watching a news show yesterday on social media and I saw a story about how guns were dangerous and should be outlawed. This story was followed up by a story about how the temperature was becoming more erratic, this was due to global warming so we should all drive electric cars.

Political opinions aside (and those who know me, know that I have quite a few), these stories are just one of many, where commentators (frequently not scientists, specialists, or frankly anyone who is remotely qualified to speak on the subject) tend to elaborate how their point of view is correct because of this specific set of data. If you actually study the data in these issues or similar types of issues, it will become clear to you that correlation does not imply causation.

This phrase, “Correlation does not imply causation”, is actually well known among people who have an understanding of statistics. Unfortunately, it not as well known outside the field. Hopefully, I am able to shed some light on this concept in an entertaining way that does not involve yelling or the 6 box debate.

Correlation

Correlation is the relationship or movement between two or more variables. This is typically presented as a number between 1 and -1. A relationship of 1 would be a 100% positive relationship where you could not tell one data point for the other in terms of movement. A relationship of -1 would be a 100% inverse relationship or exactly the opposite. An example of an inverse relationship would be a seesaw one side goes up and the other side goes down, or the performance of stocks and bonds, or the change in the interest rate of a bond and the price of that bond.

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