Economic Misery Report!

Economic Misery Report!

money.cnn.com

The official numbers produce a current Misery Index of only 8.9 - inflation of 3.9% plus unemployment of 5%. That's not far from the Misery Index's low of 6.1 seen in 1998.

But using the estimates on CPI and unemployment from economists skeptical of the government numbers, the Misery Index is actually in the teens. Some worry it could even approach the post-World War II record of 20.6 in 1980.

"We're looking at government numbers that are really out of whack," said Kevin Phillips, author of the book "Bad Money."

(visit the link for the full news article)

I have been waiting for a panel of experts to come out and say it how it REALLY is! .. And here we go folks!

The Misery Index number is Inflation percentage + Unemployment percentage. Currently, by Government books, Misery Index stands at 8.9 .. but experts are saying it is really in the teens AND could be reaching or already past the record Misery rating in 1980 of 20.6!

No inflation if you don't eat or drive
According to the government's most recent Consumer Price Index, a key inflation reading, consumer prices rose 3.9% in the 12 months ending in April, down slightly from the 4% annual inflation rate in March despite record gasoline prices.

But Phillips argues that consumer prices are probably up at least 5% and perhaps more than 10%.

Part of the disconnect may be due to the fact that nondurable goods, such as food and gasoline, makes up only 12% of CPI.

In addition, food and energy prices are eliminated from the so-called core CPI, which many economists tend to focus more closely on because they claim food and gas prices are volatile.

But food and energy costs are a very important part of household budgets. And those prices have been skyrocketing: Gas prices were up about 21% over the 12 months ending in April.

Quite simply, the economic numbers of the Fed are a completely out of whack, and in no way in hell represent the REAL numbers. Especially when it comes to inflation.

When we have Middle Class families in Santa Barbra living in SUV's ... and the Gov says "nothing has changed" .. I say BS!

money.cnn.com
(visit the link for the full news article)

[edit on 5/21/2008 by Rockpuck]

[edit on 5/21/2008 by Rockpuck]

You guys may also like this site:

ShadowStats.com

Underlying economic and banking system fundamentals rapidly are getting worse, not suddenly better as touted in Wall Street's fantasies. Another tall tale is of the Fed's valiant fight against recession, while containing inflation. Now that the economy has been turned, the story goes, the Fed can slowdown or eliminate its easing so as to concentrate on its inflation fight. What nonsense! The Fed's primary concern remains preventing a systemic financial collapse; everything else is secondary. The Fed has very limited ability at present either to stimulate the economy or to contain inflation, despite severe problems in both areas.

Is ATS dead tonight? What gives??

Nah, they're not dead.

I think they just don't know what the Misery index is... and likely think it's fake upon reading it.

Fear not though, I know what it's talking about.


The misery index is a relation between inflation and employment, sometimes used to forecast the direction of the economy.
You can pretty much line it up with the housing index, and get a very similar chart.


Also, I think the rest of the ATS crew is already well aware of the desperate situation North America is getting into... and have exhausted themselves complaining about it.

We've pretty much come to the understanding that no matter what we do, the trends continue... which means there's an external force at play that the people have no control over, only the government has control over it.

Which pretty much summarizes as bunker down and prepare, or get out of the country.


My message to them is... it's no longer the United States anyways... so why bother sticking around... there are plenty other countries out there with more freedoms than you have had in your life... and they aren't going to be hit by the economic crisis as badly as the US will.

Remember, the US has little to no means of self support. They are a consumer nation, not a supply nation. With no buying power... they have no means to feed themselves.

If these trends are true... it could come down to a point where you have to make a decision between starving, or getting out.

I am glad to see that someone knows what the Misery Index is..

Only.. if you put the same calculations and compare it in other countries in Europe, or even other countries around the world.. you will find that the Misery Index is actually higher then the US.

Yes, the US will be hit hard, but the entire world will be reeling from it's effects -- they already are! .. many smaller countries who act as "service nations" to larger economies are already feeling the effects of not a recession, but a depression!

America cannot fall into a void and the rest of the world get on with life as if it where normal. The effects will be far reaching..

Just last night over dinner I was having a row with my dad about inflation .. he doesn't think it is as high as I do (I guess it to be around 10-12%) much higher then the Federal "3.5" percent.. but it's quite simple. In the past month alone inflation has been 4 times the "official" calculation for the past 12 months!

I paid $3.97 for gas this morning.. stared at the pump for a good 5 mins deciding if I really wanted to spend that much on gas.. I own my own business, I could work from home I suppose.. in the end, I put $15 in and got a quarter of a tank. And before you say "That's not that muich other countries pay twice that much!" .. I drive 2,000 miles a month. Enough said.

The thing I have personally noticed, and I know this is just my personal experience from my own city and does not reflect the entire country.. well, perhaps it does I don't know. My girlfriend is graduating college with a 4 year degree in Nursing. She got a job at a hospital only because she has worked there already for so long .. so many others in her class are without jobs. Nurses without jobs. A year and a half ago they where offering 5k bonuses and cars to get nurses to take jobs, now they have shut the doors and cut the budget.

And my job caters around self employed business owners.. as more and more go out of business.. I loose money. Not only that, increasingly people I call all over the country it's the same story.. stories of financial hardship and even ruin.

ATS needs to continue discussing the problems in the economy, for many many people ATS will be the only place they see news on the economy that is not biased and distorted by Main Stream Media.

Govt numbers have been out of whack for a long time, we get a number today and a month from now it's revised either up or down and then the next month the same thing happens to last months numbers and the normal person gets totally lost and the big picture is completely distorted.

We don't need a Misery Report to tell us how bad it is, when airlines start charging us for checked luggage as American Airlines will be soon doing, and when our pockets are hurting even though economic sources say no recession, no inflation, we know other it's otherwise.

btw appropriate name for this index.... Misery index indeed.

it can't really be all that bad. After all we aren't even in a recession! Sorry Rockpuck I just had to throw that out.

respectfully

reluctantpawn

This is true, the Government does revise it's numbers. To me it is a clear as day admitting to the world they lie to begin with. That is to say, back in February they said thousands of jobs where created. Two months later they came back and said "actually.. we lost about 80k jobs" ..

In my area, we are always looking for new people to fill empty spots, but most of the unemployed lack the requirement to fill them.

Interesting times to live in .. I can only thank God I have a great job and am still making money while those I would have been graduating with had I stayed in school are jobless and moving back in with their parents.

Also, to all those on ATS from other countries.. I love reading economic news from other countries, but usually you have to pay to read some of the bigger news sites out there (converted to English) so if you can post some articles from your home countries! Share with the world how the smaller economies not covered by MSM are faring in this economic climate.

reply to post by reluctantpawn


GDP is increasing by .6% ... given the Gov's horrible track record it could be + or - 1-3 points. If unemployment is rising, along with inflation.. it would only be logical to assume production must be dropping as well. We will see how this quarter fares.. see, with the economic stimulus package we should see a big increase in consumer spending and thus, the economy is ok! .. $300-600 per family just in time for $4 gas!

This page includes the pain and misery index (along with some other interesting charts like the M3) showing three different values depending on which statistics you believe.

The M3 graph and the graph here about the treasury bonds look a bit worrying. If they're correct it would certainly go some way to explaining why inflation is growing so quickly.

The problem is that these figures have become political tools to be manipulated rather than economic indicators and hence have lost both any significance and any connection to the real world they may have had.

Well Rockpuck, I don't have any articles, but I can give you first hand experience. I live in Western Canada and we are booming. We do not have nearly enough people to fill all the jobs we have available. The starting wage for a place like McDonald's is around $12/hour. You really have to work to NOT get a job here. If you can do oilfield work, or want to learn, so much the better for you, those guys start around $25/hour.

It is not all roses and sunshine though. Because of the huge boom, our housing prices going insane. The provincial capital here has seen a 200% increase in housing costs in 2 years. THe big oil city I was in before was even worse. Mobile homes with lot selling for $400,000 and up. No place to rent and if you find a place a one bedroom apartment would run about $1500/month. Gas prices are completely retarded. Right now the gas station across the street from me is charging $1.20 a litre.

So there is the ups and downs here, good money to be made, but alot of it will be spent on a place to live.

ORegon and Washington are in the same situation. So much resources out there with such a small population it is no wonder really that the entire region is exploding.

It is slowing though, from what it was, at least in Oregon and WAshing. Still much better then the rest of the country. Especially compared to Ohio lol.

reply to post by Rockpuck


Lol I still think that we are severely overpopulated, personally. But you are right, just need to get out of the major towns here, and there's wiiiiide open forests. Having moved from the central valley, California, it's just beautiful here if you can avoid the big cities.

Anyway, I thought you were one who really didn't believe the economy could be in trouble?? Shame to hear about the girlfriend's classmates.

Got to admit, I only just recently started to notice prices of food going up. Before this, I was hoping we wouldn't get it as bad as the rest of the country. Well, we are all in this together.

I agree, work for yourself if you possibly can, work at home. It is nice not having to pay for gas, I don't even have or want a car at this point.

But I have to admit, that in what I do, my pay depends on another country's economy. I am worried about them taking a dive with us.

Rockpuck. Maybe you can answer what I have been wondering about for a while?? You work in financial stuff, so... What I am wondering, at this point, what currency would you think it best to keep your funds in?
I know that some think the "elite" are grabbing up Euro's right now. I wonder if it is safer to hold onto English pounds right now, than dollars?

OK, firstly, no I am not one who claims the economy is "ok" or anywhere near.. You may have seen me often ridiculing other people, but not on their outcome but rather "how they got there". Basically I feel some people believe the economy is going down the s*ter for the wrong reasons. To better understand the real situation, you need to understand why the economy is really in the mess it is.

As to which currency .. hmm .. tricky. I am not a Financial advisor so don't take my advice as such, yes I work in the markets and insurance and other things, but I am not a "advisor" .. there is a specific license for that lol.

I would say invest in the American Dollar. OMG Say what?!

Ya. The Dollar. Here is why.

The dollar goes down. Not good for us Americans, horrific for those Europeans and Canadians and Asians and crap, it's horrible all around.

Countries with vast reserves of Dollars took a hit. Countries who held a lot of long term debt with the American Currency (China, Japan, the UK, Ireland, etc, etc) got screwed because we dropped our interest rates (dollar sinks).

So what happens to countries who don't exactly export anything but tourism and maybe a few high tech services? They experience something equivalent to a nuclear bomb detonating on their markets.

America's love to go all over the world, throw around the Green Backs and get lot's o' goodies for them.

But now an American that goes to Paris can't buy a cup of fancy French Coffee without feeling a hit to the groin.

The exchange rate of 1 dollar to 1.59 Euro's means you set aside 10k for that trip to Paris, your money is really only worth $6,300 or so dollars. Add that to an inflated market because it thrives on tourism, and the fact that the Euro is so over valued prices are steeply rising at nearly TWICE the inflation rate of America! .... your trip to Paris just got ruined.

France felt a hit after 9/11 .. so did many other countries.. countries like Italy, Ireland, Greece.. countries who have a big tourism market.. then the economy "picked up" America racked up debt and all of a sudden the currency drops like a rock.

This summer you will see the Euro begin it's decline. It will decline because the European tourism market won't be having nearly as many Americans over there spending money. Their economy will take a hit, unemployment (already higher then America) will increase and inflation will, once again, increase dramatically. All because America's dollar is worth half a Euro.

Some smaller countries in Europe, including emerging markets in Eastern Europe are already feeling the dramatic effect of the weak dollar.

Which is why I asked posters to give some news on their home countries. The only other news outside of America I read are British and Irish papers, and I know from reading them that Britain's economy is in no better place then America's, and Ireland's top corporations are announcing an expected thousands of job cuts from the high tech markets and possibly even more from the tourism trade as it collapses. In one day on March 17th 5.5 billion dollars was wiped from the markets over there, a nation the size of West Virginia.
www.independent.ie...

Personally, IMO of course, the world markets are so closely linked to America that regardless, if America's currency continues it's decline so will other Currencies soon follow. I would buy silver, if you feel you need to secure money in something.. it's price is increasing much faster then Gold's, and it is cheap enough that you can buy it, unlike Gold which is almost 1k an ounce.

In 12 months, the dollar has lost nearly 30% of it's value.. no one can pretend the US, or the world for that matter can weather it unscathed.

I would like to see the misery index calculated using the same formula used in 1980. I know it is still unemployment and inflation combined, but the way those two benchmarks are calculated has changed dramatically. I know for a fact that gas prices are up almost 50% around here in the last year, and essentials like milk, eggs and cooking oil are up about 35%. How can true inflation be measured when staples like these are not included? Wasn't the formula used to calculate unemployment figures changed a while back, as well, to include people on active duty in the military?

Its like trying to compare the value of a dollar today to the value of a dollar in 1960. Adjustments for inflation have to be made. The same concept applies here. Changing the parameters of the calculation base changes the results of the calculation. We are being fed bogus numbers, and it is becoming blatantly obvious.