Rule of 72

Divide 72 by the periodic interest rate to find the number of periods to double the money.

http://en.wikipedia.org/wiki/Rule_of_72

Great rule, should be the very first thing taught in high school when you get to exponents.

Dr. Albert Bartlet of University of Colorado has an excellent lecture on its implications for population growth, environmental degradation, and other big picture problems:

http://www.youtube.com/watch?v=F-QA2rkpBSY

Funny you mention that "rule". It's not very accurate, and becomes less accurate the higher the inflation/interest rate goes.

I just worked it out; at 80% inflation it would take 1.18 months to double, not 0.9 like the rule of 72 would suggest. That's a fair difference, and certainly more in line with intuitive expectation.

Not that the OP isn't being overly finicky. Both round to 1, and only one significant digit was given anyway. But still.

I just listened to this story on the radio and I distinctly heard them say "about $2 a month later". This could just be a transcription error, as it was produced for radio first.

it's a close enough approximation. isn't it?

It is, certainly. My only issue is that it wasn't treated like an approximation.

I think you need to listen to the audio podcast version before you disparage the style of exposition they use.

The Planet Money folk unashamedly try and explain economic current affairs and stories as simply as possible. It's essentially their self professed raison d'être and they do a good job of it.

Quibbling about the the accuracy of their simplified examples is missing the trees and the forest.

You're welcome for the layup opportunity to score some easy points.

This serves as a good reminder that you will be swiftly punished on HN for making a comment that doesn't add value.

In my defense, I didn't miss the trees and the forest. I was merely pointing out that the story was dumbed down, as you put it, "as simply as possible." And replying to a post pointing out their overly simplified math. Seriously, implying that 1 x 1.8 = 2 isn't even back-of-the-envelop close.

However I did enjoy learning about how the Real came to be.

I am going to have to steal that line about the trees and the forest.

I am an engineer. I frequently do such approximations ;-)

For most uses, like prices of eggs, it's close enough.

So that sounds like a BOEC, no?

Envelopes are for sissies ;-)

Well, it is true that probably 100% of my BOEC calculations are done entirely without the use of a physical envelope, so I couldn't disagree with you.

Since the arrival of e-mail, I keep my envelopes in the same drawer as my slide rules.

Agreed.

However, I do keep one non-virtual slide rule around just to whip out and show the kids now and then. Nice mahogony base, teflon slide, the works.