The Misery Index has been gaining traction as of late with its biggest increase since the early 1990′s. For those not in the know, the Misery Index isn’t a measure of how grumpy people are, but is simply the sum of the inflation and the unemployment rate.
This misery index has been rising for the US, Canada and the Eurozone as a whole. Factors such as a “jobless recovery” boost it, and it played a major factor in both President Carter’s election (where he made frequent mention of its level of 13) and his subsequent loss four years later (when it was at over 20). With elections coming up for many in government, you can be sure more than one politician will be eyeing this Misery Index.
For those of you who remember your Economics classes, however, this might sound eerily familiar. Perhaps you were taught that inflation coupled with unemployment equaled something called Stagflation. Well, not exactly. Although there are many different “exact” definitions of stagflation, it is currently calculated by using inflation and average hourly earnings. So while the word seems to have gone out of fashion as of late, you are still somewhat correct, so we still want to re-hatch an old cartoon of ours for you:
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