Misery Index: Worst in 28 Years

How Miserable? Index Says Worst in 28 Years

28 years ago would be 1983. I remember that time: Jimmy Carter was just replaced by Ronald Reagan as president. The economy was weak, work was scarce and yes, the misery index was high.

The index is a total of the unemployment and inflation rates. The problem with this current index is the measuring standards for both of those rates have changed dramatically since 1983, making the figures appear better than they, in reality, are. The current official unemployment rate is 9.1% and 3.6% for a 12.7% misery index.

In the words of John Williams at ShadowStats.com

"The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994."

The true unemployment rate, according to ShadowStats statistics is over 22%.
 

In regards inflation, again, in the words of John Williams:

"The CPI on the Alternate Data Series tab here reflects the CPI as if it were calculated using the methodologies in place in 1980. In general terms, methodological shifts in government reporting have depressed reported inflation, moving the concept of the CPI away from being a measure of the cost of living needed to maintain a constant standard of living."

Using the same method of determining the inflation rate used in 1980, the true inflation rate is 11% or better.

Totalling these two true figures, the real Misery Index is 33, not the 12.7 the .gov types would have you believe.

The sad thing is, the misery is going to increase, not decrease, for the forseeable future.

 

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