I am writing this because the graphs that one finds on Google, in the press, and on television could not only be misinterpreted by those not used to graphs, but can frighten the daylights out of them as a result of what they appear to say about the credit crunch. A graph is nothing more than a pictorial representation of a condition, but how it is presented can seriously affect the interpretation. What I strongly object to it is that these graphs are representing the relationship between the pound, and say the dollar. They don’t show the whole of the graph to the zero baseline, but start it at such a high level that the variations for a single day’s trading are shown out of proportion, giving a frightening effect. A lot of us are frightened enough as it is.
I have been using graphs all my working life. It is a simple tool to enable me to assess problems quickly and easily without recourse to pages of mathematics. It is pointless to draw graphs representing very short periods of time, except in scientific or research projects. It is even worse to draw them truncated, where the baseline is not zero, but some arbitrary position further up the scale, because this changes the whole relationship, unless one can interpret accurately the differential. If one is drawing a graph of expenditure, for example, the time intervals of the baseline should bear some relationship to the rate of expenditure, if one is paid monthly, then monthly. The graphs that I’ve been objecting to are based on a daily change in the value of the pound, when we are either paid weekly or monthly, and as finance is influenced by more than the rate of exchange, to present the variations on a daily basis, is not giving a guide to the trend. This latter presentation is harder to find, even though it is more useful.