Illusion or junk? 3
Aug 09, 2006
Daniel, in his comments to my previous post, pointed out that my version of the bond market data focused on the relative sizes of different types of bonds, rather than their absolute values. This is a keen observation and a design choice.
When the chart designer tries to juggle too many balls at once, he tends to drop them all.
As it were, I started out by creating a graph of absolute values but I just did not see much interest in it. Here it is. One would think the growth of ABS was extraordinary but not according to this chart.
The relative values were a lot more informative, in my opinion.
Relative versus absolute doesn't have a definitive answer. Personally, I like the absolute values since this shows how much the US has gone into debt [might also inflation-correct this, but this would just change slope of all lines]
Posted by: zbicyclist | Aug 12, 2006 at 09:26 PM
I agree it is a design choice. The choice, of course, should be decided by what point you are trying to illuminate with the graph.
Relative, as you said, makes trends between the different types of bonds more clear. Absolute makes the growth of debt more visible. Both are good, it just depends on which you need to show.
Posted by: Daniel Staal | Aug 14, 2006 at 11:38 AM