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  1. Communicating Quantitative Information Google Savings & Mortgages. Various visualizations: Presentation of data, including examples identified by Tufte Homework: Retirement exercise.Post topic (with article, lecture) for Project II Postings. Extra Credit.

  2. About google • Google programs browse the web, investigating all links and • Build/modify a database in which web pages are associated with terms (aka key words) • Actually a copy of each page is also part of the database. This is called the cache[d] copy • Google ranks pages with respect to the terms. If a page A points to a page B with the contents of the link being a term, then that is considered a stronger association than if the term just appeared on page B. • Google ranks pages, using a recursive procedure in which a page's rank is dependent on the rank of pages pointing to it. • These aspects of google's database are what make it produce better hits.

  3. Searches • Google's algorithm is a type of cloud sourcing. • You still need to evaluate the hits (the pages) • You need to consider the source/viewpoint. • For much research, it can be valuable to have sources with specific viewpoints. • 1996 Bob Dole site story • Intelligent Design: Discover Institute • But you need to understand what you have: • multiple viewpoints and, if possible, [some] neutral viewpoints

  4. Reprise: Mortgage • One type of mortgage is fixed rate, long term (typically 30 years) • You pay a 'down payment'. The bank loans you the rest. The bank has a lien on the house (makes sure you take out insurance) • Payment is fixed amount: covers the interest on the loan plus some of the principal (not much of the principal until much later) • What is the payment?=PMT(rate,number_of_payments, principal) • (Note: mortgage payments also may include payment towards real estate taxes. This is called 'escrow'.)

  5. Mortgage • Each pay period, you pay interest plus principal • amount for interest goes down as • amount of outstanding (still owed) principal goes down • so, amount that goes for principal goes up • Excel ppmt(rate,period,nper, pv) gives the amount that went towards principal in period

  6. Savings/Investment • A significant addition to the types of investments mentioned at a previous lecture is your house/home. • Current tax policy encourages home ownership by providing a deduction for mortgage interest. • [Calculation is more complicated, but roughly] if your tax rate is 25%, and the interest part of your mortgage payment is $12,000, then you don't have to pay taxes on $12,000 of your income, saving you $3000. Your housing costs are $9000. If you rent, you don't get this deduction. • Only significant if you 'itemize deductions'. • Advantage goes up with larger marginal tax rate • current top rate is 35%. May go [back] up to 39%.

  7. Related items • Variable rate mortgage: rate changes based on formula, e.g., "2 points above the prime" • Home improvement loan: borrow money to add to house • Home equity loan: borrow money against current value of home (minus what is owed). Possible especially if value of house has increased. • NOTE: mortgage rates generally better than credit card rates and there is the deduction. • NOTE: you only pay credit card interest when you DON'T pay total owed each month.

  8. Estimations • Deficit: $1.4 trillion. Fix: $16 billion. What is the percentage? $21 billion? $50 million? • 6.2% Social Security tax. Divert 2%. What percentage? • Oppenheimer-Cohen NY State Senate: 40527 to 40023. Percentage difference? Hint: add two numbers and then estimate… • Significant fact: 10,000 votes uncounted. Though absentee, emergency, etc. generally follow regular voting patterns.

  9. General lessons: data presentation • Feature the data, not • decorations • mechanics of presentation • false dimensions Data-ink should dominate, not chart-junk • Use text or tables for small amounts of data • Show (feature) what is important • important dimensions • relationships • context • easy to follow (honest) legends & scales

  10. More on Budget • Visualization • • Note: accept that this, and others, are correct….

  11. Old: Subway fare • Should a subway fare cost more?New York Times, November 23, 2008 • Notice the multiple contexts! Also refining definitions.

  12. Government measures of employment Unemployment: count people receiving unemployment benefits + people registered as looking for work Employment: survey households to see who is working ALSO add up taxes collected from employers for workers

  13. Visualizations of unemployment • Two examples showing context (What's the difference?) in terms of geography and time: • •

  14. Exercise • Write down 2-3 findings from visualizations that are not what you would expect, surprise you • (This does require you to be interested….)

  15. Old: Immigration and wages Does the presence of illegal immigrants depress wages? Cost of Illegal Immigration May Be Less Than Meets the Eye The New York Times By EDUARDO PORTER Published: April 16, 2006

  16. What the graph shows • Note: only lists some of the states and does not indicate regions within states • Have to trust writer • Note: article does refer to study that indicates some effect but says that it is slight.

  17. Immigrant jobs • Dimensions of country of origin and occupation •

  18. (shown previously? deserves re-look)What are the dimensions shown?

  19. Dimensions are • time (dates shown in vertical lines) • geography/space (2 dimensional), • size of army (thickness of line) • direction (color), • temperature (chart at bottom)

  20. Sources • • includes responses to challenges to improve the graphic •

  21. Mathematica drawing

  22. Dimension • … more than length, width, height • Time charts (aka time series) relatively new • List of timelines: Note: the appeal of gapminder is the number of dimensions shown in the charts Multiple countries Each country: population, region, gdp, health Over time

  23. Challenger story Summary book review: Decision needed to be made on whether or not to have the launch. The Morton Thiokol engineers (makers of the rocket) argued against it. They lost the argument. Tufte describes factors that were obvious that made the presentation weak, including lack of authorship failed at showing relationships

  24. Slides • • What someone called 'crayons in a box' displayed information by flight as opposed to featuring the connection between temperature and damage.

  25. StatView adaptation of Tufte chart

  26. Aside • Some would argue that the real cause of the problem was that the space program required distribution of contracts. If the rocket would have been built [much] closer than Utah, the O-rings may not have been necessary.

  27. Show data in context • What is the context may need study • Small amount of data is suspect • [Tufte example]: Connecticut reacted to a large number of traffic deaths by imposing reduced speed limit. Traffic deaths fell… • Two data points!

  28. Connecticut traffic deaths Left chart: 2 data points! Right chart: (at least) shows context in time Need also to show context in space: what was situation in other states Anything else?

  29. Common situation Interventions often look good because they often are applied after unusually bad times. Regression towards the mean Things 'even out', tend towards normal Sports Illustrated jinx Player featured on cover AFTER unusually good performance tends to do worse afterwards.

  30. Causation vs Correlation vs Coincidence To confirm that A causes B need to examine cases when it doesn't (A and not B) Examine other factors that may cause B Does some factor C cause both A and B Examine mechanisms (internals) of A and B.

  31. Includes some definitions on chartThink aboutScale on right?12-month moving average?seasonally adjusted? NYTimes (4/12/05) has background, theories.

  32. Diagrams Some require us to • compare areas as opposed to lines • square A side 5, square B side 10, what is ratio of areas? • consider color information along with sizes and positions • refer to color key • Which examples?

  33. Refrain on Social Security • Social Security is pay as you go program: • Current workers pay in and most of that money goes out to pay current recipients • The worst prediction is NOT that all Social Security payments will go away but that the program will exhaust reserve and the anticipated income will only pay 70% of needs. • Government can fund the difference and/or • Make changes • On the income (tax) side: pop the cap, raise rates • On the outgo side: raise age, change rate of increase to wage inflation, not cpi • ???

  34. Retirement exercise • Yes, it is complicated. • Yes, pays to start saving early: • The miracle of compound interest • Yes, contribute to company plans especially when there is a match • Yes, homes are significant source of savings/equity (value) for most people • So, drop in home prices is concern for many • My bet is that Social Security will be around and contribute some to most people's retirement • Most calculators correct for inflation in some way.

  35. Homework • Retirement exercise: use on-line retirement calculators to see if [your subject] needs to save more money for adequate retirement. • See prior lecture on John/Jane Doe • Post proposal for Project II • Postings • Preview: talk on artists and visualizations. • Extra credit: (put in General Discussion Board) • research Tufte's critique on PowerPoint. Comment. • (Note: I do agree with what he says and try to make my charts better….)