Among yesterday’s front pages was a data visualisation which, at first glance, was one of the most effective I’ve ever seen: the Independent had made an infographic showing yesterday’s £6bn budget cuts in context - as a fraction of a debt mountain.
Then I looked closer - and something’s very, very wrong.
Can you tell what it […]
There’ve been three stories about bad/calamitous days (or plunges) on the stock markets since my post on last month’s “crash” (technically not a crash, it was only a 5 per cent drop). Yet looking at the actual level of the market it’s at around 5875. Which is about the level of the market before the crash. We might have a lot of economic issues at the moment, but it’s not really showing in the markets just yet…
The FTSE 100 fell about 5 per cent today (Evening standard readers will have been treated to a “£60bn STOCK MARKET CRASH” headline). That’s pretty nasty, yes, but take a look at the two graphs below. The first is a more-or-less faithful recreation of the stock price graphs on the BBC, in the Evening Standard, and several others - and uses the real share price data:
And here’s graph two:
The second one looks much less scary, doesn’t it? Even with that dip at the end. Of course, you’ve probably guessed they show the same thing - check out the vertical axis. The first graph, in common with almost all these things, is truncated. The second shows the full range. The point being that the first makes everything look utterly catastrophic, the second pretty dull. No-one’s saying a 300-point market drop isn’t pretty damn important. But when markets actually rely on confidence, a bit less hysteria might be handy…
Hat-tip: Darrell Huff (about 30 years ago)
