It's Not So Miserable Out There, Now Is It ...

Posted At : March 25, 2008 1:05 PM
Related Categories: Spend Management

Thomas Kase (AECsoft) recently tipped me off to an online tool that shows the "US Misery Index". The site charts the combined misery level of inflation and unemployment within the country at a relative point in time. Judging from how the index looks today, things aren't so bad (that is, if you're not working for Bear Stearns). In an email, Thomas pointed out to me that "if these numbers were adjusted for fuel prices, then I think we'd see an even flatter line." While it's true that inflation and unemployment are not yet at significantly elevated levels, they're definitely trending up -- perhaps inflation more than unemployment. Still, if we measure the economy from an historic consumer perspective relying on just these two factors, things aren't all that bad yet. Which to me is further evidence that judging the state of the economy and consumer pain is more art than science. So next time you read the headlines on CNN about "trouble at the pump" or parents who "can't afford to buy eggs for their kids" because of inflation, remember the actual "misery index". It tells a different story indeed.

- Jason Busch

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I fail to see the relevance of an index that does not include a real income measure. Inflation X unemployment? What the hell does that mean? So, because I'm employed at Mickey D's flipping burgers, I'm doing just fine, because also inflation is low? Someone has an economic screw loose.

# Posted By Henry | 3/25/08 1:55 PM

Health care costs (especially) and higher education costs are skyrocketing.

You don't see this because it's not a concern to you, and you probably don't socialize much outside of your bracket. Families and individuals everywhere other than in the top income decile are hurting from health care, and it's getting worse. Not only are costs rising, but coverage gets clipped.

And the housing market turmoil isn't pretty, either. It's only the beginning on that front. We're headed for a 5-10 year bad patch for the US economy. We've got to stop this "let big business do whatever it wants" madness that has gotten us to this place.

# Posted By frank c | 3/26/08 11:45 AM

It's not just spiralling costs (though undoubtedly that disproportionally affects those in lower income brackets) it's the personal debt that so many people (stupidly) got themselves into. And debt affects people at all bracket levels. People that buy places that they couldn't afford or borrow all of their home equity to live outside of their means also play into this current state. We can't just be blaming Corporate America for all of our ills.

# Posted By Lisa Reisman | 3/26/08 12:14 PM

Fair points all around (though I do socialize with all types including a family member who was uninsured for most of the past decade because he could not afford it). On the healthcare issue, I pay around $1700 per month for 3 employees for top notch coverage and 1 has family coverage. In the UK, private insurance can be nearly as much (and that's on top of the rest). Our system is not perfect. But I'd much rather run a small business here, get sick here, and get treated here than in Europe.

# Posted By Jason Busch | 3/26/08 1:23 PM

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