Rushing to judgement

Charting, since the great John Tukey spoke, has been recognized as a key subject of "exploratory" data analysis.  Starting with a battery of hypotheses, one can use charts to examine them, reject those not viable, and for the viable ones, search for the best perspective.

When the order is subverted, that is, when the conclusion is fixed before charts drawn, the result is often embarrassing.  This cited example is perhaps a result of such.

The header confidently announced: "since ... November 2005, most newspaper stocks have done poorly". 

Of six stocks shown, McClatchy really did poorly; Gannett and NYT weren't much better; however, Tribune appeared to be on the upswing, Dow Jones was also stable, and Knight Ridder was up.

Moreover, in order to fully appreciate an "industry challenged", one needs to establish comparability by including the performance of an index, say the S&P or the Dow.  When this is done, one realizes that the whole group of stocks have underperformed the general market (The Dow Jones average hovered between 0% and 10% during this period.)

Reference: "What-ifs of a Media Eclipse", New York Times, Aug 27, 2006

Comments

[Mike Anderson]

It would also help to show a companion chart with the changes in circulation for each company over the same period.