Reality is Better than Statistics

From Reuters: Most housing indexes overstate downturn -analysts.

Most closely watched U.S. home price measures lack enough local data to truly reflect house values and are overstating the extent of price drops, executives at a real estate analytics firm said on Monday.

An index is merely an average. It can be badly constructed but otherwise it is exactly what it is - an average, and indicative of the tendency of a population even though it may not reflect the distribution.

Now, the real question is whether the RE analytics firm might actually have a self-interest in "boosting confidence".

Of course, one cannot expect the "superior brain trust" of the MSM to think through these things.