“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.
|Harry Truman||1948–1952||7.88||3.45 – Dec 1952||13.63 – Jan 1948||13.63||3.45||-10.18|
|Dwight D. Eisenhower||1953–1960||9.26||2.97 – Jul 1953||10.98 – Apr 1958||3.28||9.96||+5.68|
|John F. Kennedy||1961–1962||7.14||6.40 – Jul 1962||8.38 – Jul 1961||8.31||6.82||-1.49|
|Lyndon B. Johnson||1963–1968||6.77||5.70 – Nov 1965||8.19 – Jul 1968||7.02||8.12||+1.10|
|Richard Nixon||1969–1974||10.57||7.80 – Jan 1969||17.01 – Jul 1974||7.80||17.01||+9.21|
|Gerald Ford||1974–1976||16.00||12.66 – Dec 1976||19.90 – Jan 1975||16.36||12.66||-3.70|
|Jimmy Carter||1977–1980||16.26||12.60 – Apr 1978||21.98 – Jun 1980||12.72||19.72||+7.00|
|Ronald Reagan||1981–1988||12.19||7.70 – Dec 1986||19.33 – Jan 1981||19.33||9.72||-9.61|
|George H. W. Bush||1989–1992||10.68||9.64 – Sep 1989||14.47 – Nov 1990||10.07||10.30||+0.23|
|Bill Clinton||1993–2000||7.80||5.74 – Apr 1998||10.56 – Jan 1993||10.56||7.29||-3.27|
|George W. Bush||2001–2008||8.11||5.71 – Oct 2006||11.47 – Aug 2008||7.93||7.39||-0.54|
|Barack Obama||2009–2016||8.83||5.06 – Sep 2015||12.87 – Sep 2011||7.83||6.77||-1.06|
|Donald Trump||2017–2020||6.60||5.21 – Sep 2019||15.03 – Apr 2020||7.30||8.06||+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!