How to Lie with Statistics – Part 5: The Gee-Whiz Graph

Continuing with my previous post, here I summarize Chapter 4 of the book How to Lie with Statistics. This chapter is titled, The Gee-Whiz Graph.

If this chapter could be summarized in six words it would be the following: It is not what it seems. Here we are illustrating how by merely adjusting the scaling of a graph you can get it to say whatever it is that you are trying to prove. Ten percent growth in one year is a “drop in a bucket” when illustrated in a 50-year graph; but when compared versus, say a 2 year graph, the 10-percent rate can be made to look fantastic. Adjust to quarters, or months, or days, and you can get even more stunning results – just like the doctor ordered. In other words, what would visually be a handsome yearly return is lost when viewed in the context of a longer time frame; and vice versa. So, whenever anyone shows you some graph (yours truly included) always check the scaling. Do not be deceived.