Most people know that the stock market is a volatile place and that the price of Rio Tinto shares has fluctuated significantly both up and down over the last thirty years. But this is how at least one modern climate scientist might go about promoting Rio Tinto shares…
The first graph shows how the price of Rio Tinto shares varied over a 30 year period up until Feb 2009.
Note that the price ALWAYS goes up.
Note that the long term linear average rise is close to $1 per year over 30 years.
The second graph tells us that over the past year the rate of increase is now about thirty times the long term average.
On this basis Mr Mann, the stockbroker, advises all his clients to sell everthing, borrow as much money as possible and buy Rio because:
Rio shares NEVER go down AND they are now going up 30 times faster than ever before.
The values used to plot the graphs are genuine.
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If a broker in Australia actually did this the would probably end up in jail for misleading and deceptive conduct, even though the points used to construct the graphs are all genuine.
Jennifer Marohasy BSc PhD has worked in industry and government. She is currently researching a novel technique for long-range weather forecasting funded by the B. Macfie Family Foundation.
