I think we all have experienced a sense of information overload in the past 5-10 years as the volume of data available at our fingertips has exploded. The Internet has enabled this, first by putting systems online, and then with the evolution of data communication standards (API’s, XML etc) and the proliferation of information sharing tools (email, rss, social media).
We are in a period of transition, adjusting to this new environment saturated with information. This has created both the opportunity and the need for new methods of making sense of it all. In my view, video storytelling is the most powerful medium for communicating and creating meaning. However, data visualization is also very important, and there is a an explosion of interest in and use of these techniques.
I was first exposed to this field when I was at Forrester Research. Forrester took off as a company in the late 90’s because its core competency (rendering the very complex succinct with tight language and expressive graphics) met with the huge thirst for information about the nature and scope of the newly-created commercial web. I worked with Josh Bernoff and other analysts conducting research and developing these information visualizations.
Forrester sent many of us to an Edward Tufte seminar. Tufte is the modern day godfather of information visualization. Today there is a proliferation of publishing organizations that are really pushing this forward by connecting available online databases to combine, mashup, and display complex data in simple, clear terms.
A favorite blog of mine is Flowing Data. Today he has a review of visualizations that attempt to make sense of the financial crisis. Many of them are excellent.
This is my favorite from his list, which one is yours?:
Here’s a run-down on the credit crisis by Jonathan Jarvis. This is a really simplified explanation, yet it retains its accuracy. In my view it passes the cocktail hour test meaning that the average person watching this on their lunch break can remember the argument over cocktails with friends.
The one major gap in the piece is a discussion of the housing bubble. As he alludes, this is the flip side of the credit crisis coin, and actually the primary cause of the recession. Questions that need answering include: why did prices skyrocket way above historical trendlines? Why did consumers start defaulting in droves?
The catch-22 of this situation is that both consumers and business became uncreditworthy a long time ago by entering into risky debt. It was a mistake then for banks to lend and people to borrow. Now, Congress is peeved with the banks for not lending more of the money they are given. If there were not creditworthy borrowers then, how could there be now?
Now, the act of becoming more responsible (ie saving money) is in itself a fatal pill for the economy (ie the paradox of thrift). It seems like we run into these kinds of contradictions frequently with our system. Perhaps an indicator that we are on the right track will be when we move toward a system where what is good for the individual is not in conflict with what is good for society.
It’s worth your while to check out Chris Martenson’s Crash Course. It is a tour de force video presentation (broken down in 20 9min chapters) on the broad sweep of Economic, Energy, and Environmental forces that “will make the next twenty years vastly different than the last twenty years.”
In a nutshell, he argues that because of the extraordinary amount of energy (one gallon=3 months labor) in fossil fuels we have been riding a once-in-a-planetary-lifetime period of prosperity.
With an impressive array of charts and graphs he illustrates how several critical aspects of life are on a hockey stick-like growth curve–population, money, debt, energy use, atmospheric carbon etc.
He asks the question: what happens when you take cheap energy out of the equation? Since we are near-upon Peak Oil what will happen to all of our systems that depend on cheap energy?
I like Chris’ presentation. Because it is so jam-packed with information (and I mean jam-packed!), it leaves one feeling a little bit of overload–not the most empowering feeling. Since there are so many aspects to this problem, I think simpler lines of argument (cause and effect chains) that don’t need to be as all-encompassing might be better for people who are dipping their toes in these forthy waters.
I can think of no better source for erudite economic thinking and plain ‘ol common sense wrapped up in a clean, succinct, hard hitting bundle than the folks at CEPR, especially Dean and Mark.
Dean just released his new book Plunder and Blunder that draws the background, causes, and actors for the financial deconstruction we are experiencing. He comes down hard on both sides of the aisle particularly on Alan Greenspan and Henry Paulson for not calling attention to the housing bubble, which he points out was plain to see. Around 2002 housing values rocketed away from a 10 year trend-line that had mostly kept pace with inflation, and there was not a significant increase in demand or reduction in supply to justify it.
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