logarithmic stock market chart?

Question

http://en.wikipedia.org/wiki/Image:DJIA_historical_graph.svg
I put this into the politics division because this chart is a common chart used today to describe the markets...you will notice that the later years are squished tighter together. I'm wondering what the market conditions are under Bush compared to Clinton to Reagan...What factors are squishing the last few years? Is it volume traded? Is it the real value in 1970 Dollars? Help me understand this. Feel free to have opinions on the current state of our economy.

I did ask this in the business section as well

http://en.wikipedia.org/wiki/Image:DJIA_historical_graph_%28log%29.svg

this is the logarithmic version, the other is the linear

Answer 1

You did not provide the link to the log chart. It is here: http://en.wikipedia.org/wiki/Image:DJIA_historical_graph_%28log%29.svg.

A log chart is a far more accurate depiction of prices. It takes into account percentage differences which a "regular" graph exaggerates greatly!

Answer 2

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Answer 3

while a inventory is going up 10x or 100x over some years, that is greater handy to coach on a logarithmic scale. as an occasion, going from a million to ten and then 10 to a hundred shows as a line on a logarithmetic scale. On a linear graph, the numbers that are small (like a million to ten) are very on the factor of the backside (and you could't distinguish them) and then the graph in basic terms shoots up in direction of the tip.

Answer 4

The one thing that Bush and Reagan have in common is that they both made considerable tax cuts and they both enjoyed a huge economic windfall as a result.

Clinton campaigned on the "peace dividend", when in reality, we were still riding Reagan's economy.

The one thing that Clinton and Carter have in common is that they both increased taxes and sent us into a recession. Clinton made only a small change, and the recession in 2001 was short.

(Under Carter, corporations had lower tax rates than individuals, the only one of our last 5 or 6 presidents where this was true, and Carter had to raise individual and lower corporate taxes to accomplish this.)