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half_integer t1_jbynie8 wrote

Reply to comment by Ryokurin in [OC] Bank Failures by US State since 2000 by pm_me_jupiter_photos

So, as I suspected this is an example of a https://en.wikipedia.org/wiki/Base_rate_fallacy - there were simply more banks to fail in GA/FL/IL/CA?

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TheBirminghamBear t1_jbzbuvs wrote

I think it's a different fallacy but not one I know the name of.

In essence it's a count problem. Georgia had a bunch of smaller banks and this is only counting the bank entity, not the size of the bank itself.

If you changed the chart to show magnitude based on total $s of banks that busted by state, you might see a different result

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mikamitcha t1_jbziz8a wrote

Base rate fallacy is correct if you are analyzing the original point of Georgia being the worst. Its the issue of Georgia having a much larger number of banks and the graphic here is only showing the number of bank failures, not the percentage of banks that experienced a failure.

That is why both CA and FL are darker as well, you need more banks for more people. Its also pretty impressive how light TX and NY are when you realize they, alongside CA and FL, are the leading states by population by a wide margin.

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Scrappy_76 t1_jbzjwdd wrote

This is a just a hunch but I imagine TX is lower here since the banks in TX consolidated a lot after the savings and loan crisis in the 80s.

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Whiterabbit-- t1_jbzp6rh wrote

What’s up with MN?

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lazyFer t1_jbzwcrq wrote

As a Minnesotan in the twin cities, I really haven't seen any failures. I wonder if smaller rural banks failed.

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carlitospig t1_jbzx66j wrote

Ameriprise. Would they be considered ‘bank’? Though, I’m pretty sure they grew through the crisis through a well timed purchase of a trading arm.

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lazyFer t1_jc07cf3 wrote

Yeah, they were personal investment advisors, not a bank.

Coincidentally, they were the place I interviewed at one time with a group that wanted a data person to help solve their performance problems. When I told them they should let the database handle auto incrementing key generation rather than having a single component be called every time they needed a new key in any table in their database, they said they needed their performance fixed but not that way.

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carlitospig t1_jc0ble9 wrote

‘Not that way’ is always code for ‘Ack! Change?!’

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lazyFer t1_jc0ikxx wrote

Yeah, I never took jobs at places with that attitude.

When I interview people now, I always ask how they feel about throwing away code... Because if you aren't throwing away code, you're not learning from your mistakes. You never have perfect knowledge of how shit will be used until its being used.

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mikamitcha t1_jbzwlcz wrote

What do you mean? They look to be pretty much the same as the rest of the country, just at ~30 instead of ~20. Not really that much of an outlier.

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TitianPlatinum t1_jc16mbi wrote

Could also be Simpsons paradox? The confounding variable being bank size.

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Pjpjpjpjpj t1_jc20env wrote

If this map was the percentage of banks that went bankrupt, that would eliminate the base rate issue that some states have far more banks.

But I suspect Georgia’s issue would remain, even as a percentage. It’s banks were all smaller, which I suspect would make them more susceptible to failure. But it would be interesting to see that map to see if it is true.

As you suggest, dollars might be another way, or number of accounts (to level out the impact of wealth differences across regions).

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