The Misery Index – Not So Bad….Considering…

May 13, 2011 11:58 am

According to

The misery index was initiated by economist Arthur Okun, an adviser to President Lyndon Johnson in the 1960’s. It is simply the unemployment rate added to the inflation rate. It is assumed that both a higher rate of unemployment and a worsening of inflation both create economic and social costs for a country. A combination of rising inflation and more people out of work implies a deterioration in economic performance and a rise in the misery index.

This is an interesting series to watch, especially because the combination has the potential to explain what the consumer may be up to. Even with the high unemployment and the rising inflation, the index is still no where near where it was back in the 1970s. This is one explanation as to why the retail sector is still doing very well.


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