Happiness Blossoms When Economic Growth is Strong

#happiness #misery #jobs #inflation #employment

The best way to mitigate misery is through economic growth“– Paul Ebeling

The human condition fits in a spectrum between ‘miserable’ and ‘happy.’ In the economic space misery flows from high inflation, steep borrowing costs and unemployment.

The best way to mitigate misery is through economic growth as happiness blossoms when growth is strong, inflation and interest rates are low, and there are lots of good jobs available. Such as we experienced under President Trump’s policies prior to the virus attack, and just after with the amazing V-Shaped recovery.

The 1st Misery Index was constructed by economist Arthur Okun in the 1960’s to provide President Johnson with snapshot of the economy. That original Misery Index was a simple sum of a nation’s annual inflation rate and its unemployment rate. The Index has been modified several times, 1st by Robert Barro of Harvard, and then by Steve Hanke, an American applied economist at the Johns Hopkins University in Baltimore, Maryland.

Mr. Hanke’s Misery Index (HAMI) is the sum of the unemployment, inflation and bank-lending rates, minus the percentage change in real GDP per capita.

Higher readings on the 1st 3 elements are ‘bad’ and make people more miserable.

These are offset by a ‘good’ GDP per capita growth, which is subtracted from the sum of the ‘bads.

A higher Misery Index score reflects a higher level of ‘misery.’ It is a simple metric that is easily understood.

Venezuela holds the title of the most miserable country in the world. The least miserable is Thailand of the 95 ranked country.

The US ranks 64th in the 2019 HAMI rankings, and is now projected to see the worst reversal of fortune this year in a ranking of global economic misery, underscoring just how much havoc the VirusCasedemic and the reversal of many of the high growth Trump White House policies have brought to the nation as a whole.

Below is the Misery index by US Presidential Administration from Harry Truman through Donald Trump.

PresidentTime PeriodAverageLowHighStartEndChange
Harry Truman1948–19527.883.45 – Dec 195213.63 – Jan 194813.633.45-10.18
Dwight D. Eisenhower1953–19609.262.97 – Jul 195310.98 – Apr 19583.289.96+5.68
John F. Kennedy1961–19627.146.40 – Jul 19628.38 – Jul 19618.316.82-1.49
Lyndon B. Johnson1963–19686.775.70 – Nov 19658.19 – Jul 19687.028.12+1.10
Richard Nixon1969–197410.577.80 – Jan 196917.01 – Jul 19747.8017.01+9.21
Gerald Ford1974–197616.0012.66 – Dec 197619.90 – Jan 197516.3612.66-3.70
Jimmy Carter1977–198016.2612.60 – Apr 197821.98 – Jun 198012.7219.72+7.00
Ronald Reagan1981–198812.197.70 – Dec 198619.33 – Jan 198119.339.72-9.61
George H. W. Bush1989–199210.689.64 – Sep 198914.47 – Nov 199010.0710.30+0.23
Bill Clinton1993–20007.805.74 – Apr 199810.56 – Jan 199310.567.29-3.27
George W. Bush2001–20088.115.71 – Oct 200611.47 – Aug 20087.937.39-0.54
Barack Obama2009–20168.835.06 – Sep 201512.87 – Sep 20117.836.77-1.06
Donald Trump2017–20206.605.21 – Sep 201915.03 – Apr 20207.308.06+0.76

HeffX-LTN’s ranking economist Bruce WD Barren in an interview Wednesday predicts that good numbers from the Trump era are already moving back toward the bad numbers of the Hussein Obama era and beyond.

Mr. Barren believes that “The foundation for the good results that we are experiencing today should continue as we move forward with the implementation of the covid –  19 vaccines era. 

Today, the People’s attitudes are much stronger and have a deep desire to quickly return to work. The positive effect is that  the Index is already moving back from the sudden jump of the Hussein Obama era and prior, specially as experienced under the Ford and Carter Presidencies which the Index soared to as high as 16.26 versus today’s of 6.60 as noted in the above list. 

The only problem with the Index for me is its name which should had been called with a more positive name attached to it for no one likes to hear the word ‘misery’ even though for me it is the best Index composite to measure the real direction and attitude in economic recovery.” 

With all of the above a given, I believe that the Hanke Misery Index (HAMI) should be renamed the ‘Barren Hope Index‘ (BHI)!

Have a healthy day, Keep the Faith!