The latest Misery index shows that Americans are more miserable than they’ve been in the past 28 years.
The index, which was created by economist Arthur Okun, totals inflation and unemployment, is now 62 percent higher than when President Obama first took office.
“The good news is that other measures suggest conditions aren't quite that bad and over the next 18 months the gloom should lift a little,” a chief U.S. economist wrote in a Misery analysis reported by CNBC.
“The bad news is that households won't be in the mood to boost their spending significantly for several more years.”
An alternative measure, put forth in 1999 by Robert Barro, encompasses a wider swath of misery, measuring employment against the so-called “natural rate” and compares inflation against the previous 10 years and looking at whether gross domestic product is below its “potential” and comparing yields on the 10-year Treasury note against the yields of the previous 10 years.
Capital Economics’ Paul Dales says the Barro index is indicating that while things aren't expected to get dramatically better, the level of misery is probably at a peak and should roll back over the next 18 months.
“The upshot is that Americans might not be quite as miserable as the Okun misery index appears to suggest,” Dales said. “And as inflation falls back, some of the gloom will lift.”
USA Today reports that, according to Congressional Budget Office Director Douglas Elmendorf, much of the misery from the economic downturn still lies ahead for the American public.
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