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comment by mk

In all fairness, axes needn't start at zero. That's a design choice, not a statistical one. Sometimes correlation can be hard to visualize without translating axes. Of course, there should be a R value in that graph.





veen  ·  2893 days ago  ·  link  ·  

I agree that it is a design choice, but it obfuscates the scale and indirectly the significance of the numbers used so I generally find it a bad choice. Here's the same graph with axes to zero:

R^2 is 0,44 with n=7 but drops to 0,10 when you leave out the Q1 2016 outlier.

mk  ·  2893 days ago  ·  link  ·  

    when you leave out the Q1 2016 outlier.

The question is: Is it an outlier? If it's the beginning of a change, then it might not be. As I said above, the range needs to be greater. That's why I think Junk Charts doesn't make an effective point by dropping it.

IMO there's nothing wrong with a silly hypothesis, only the poor test of one. 0.44 says it all.

veen  ·  2893 days ago  ·  link  ·  

With n = 7 I agree you can't say with any certainty whether it is an outlier or not. But that is because you can't say anything definitive about this data, period. (It's not a solid proxy for predicting a tech bubble, that's for sure.)

kleinbl00  ·  2893 days ago  ·  link  ·  

I love everything about this deeply dorky conversation.