Tuesday, December 23, 2014

RGDP less the Employment ∕ Population Ratio

This is the third graph from yesterday:

Graph #1:Real GDP (red) and the Employment/Population Ratio (blue)
I want to subtract the blue line from the red one and see the difference.

I couldn't figure how to have FRED do that because showing "percent change" is FRED's last step. I need one more step after that, the subtraction. So, download the values and do it in a spreadsheet. Why God gave us the Internet.

Then, change the graph to make both series quarterly and download the data again. Rename the file and upload it to Zoho, again. And discover the Wrap Text button.

Delete the first few rows where the Employment/Population Ratio has no data. Delete the last row, where there's as yet no data for the last three months of 2014. Press CTRL+HOME, insert 5 columns and 20 rows. The graph will go in the upper-left of the sheet, and the calculations that support it will go on rows below the graph.

Maybe fewer new rows.

The dates in the FRED download file are always formatted as 1953-01-01 (YYYY-MM-DD). I always want them as 1953Q1 (Year and Quarter Number). I always forget the calculation. I always have to work it out again.

There it is. But I won't remember next time. I'll have to work it out again. Good thing it's simple. Anyway, here's the graph:

Well, I have to look at that one for a while.


Jazzbumpa said...

I think if you're going to do math, you need a narrative for what the operations mean.

Otherwise, you just have numbers in a vacuum.

Since both your series are % change form previous year, they are dimensionless numbers, and subtracting them is mathematically valid.

But what does it mean?

How can I wrap my head around this operation?


The Arthurian said...

Hey Jazz. Sometimes I'm looking at a graph and say, "I want to subtract the blue line from the red one and see the difference."

I'm thinking there might be an obvious relation that shows up after the subtraction.

When there's not, well, then I say " I have to look at that one for a while."

Actually I was hoping to have something interesting to say about it for the next day's post, but that didn't work out. I didn't see anything in the "difference" graph. Evidently, you didn't see anything in it, either...

Jazzbumpa said...

When I blog, it's generally to make a point. I forgot your blogs are often exploratory.