Misery Index: It's NOTHING Like the 1930s or 1970s
We hear a lot of comparisons of today's economic conditions to the inflationary 1970s (see shaded area above) and even the Great Depression and the 1930s (see shaded area). The chart above shows the annual Misery Index from 1930 to 2008, calculated as the sum of a) the CPI inflation rate and b) the unemployment rate. Notice that today's single-digit Misery Index of 9.7% isn't anywhere near to the double-digit levels througout both the 1930s and the 1970s, with peaks around 20% in both decades. The Misery Index is also lower today than during most of the 1980s.
Bottom Line: Cheer up, these are the good old days, says Jeff Jacoby in today's Boston Globe.