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Jackie Colson-Miller

Jackie Colson-Miller
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What is The “Misery Index” and Are We Really “Miserable” in 2008? Tampa Real Estate News and More!

The Latest News on The Tampa Real Estate Market every day on The Real Estate Sizzle!

Many Americans would tell you that things in the U.S. seem pretty “miserable” these days.  Gas Prices are up, along with the price of anything that needs to be “transported”, including groceries. Home Prices are down, and there is plenty of talk that the stock market is about to “tank” any minute. I know, the home sellers in Tampa are feeling pretty miserable. Yes, everyone is feeling a financial “pinch”.  But, is this the worst that we have seen in our lifetime? NO

It’s time for a “reality check”!  The graphic below, from the Wall Street Journal details the “misery index” for the past 38 years, divided by various Presidential Administrations. What is the “Misery Index”? It is the sum of the unemployment and consumer price inflation rates! It makes perfect sense: Job Loss + High Prices = Misery. When I read this on Saturday, I knew that I had to talk to my readers about it. I have a Psych degree and I love statistics. You can argue any point with me, as long as you have facts to back up your opinion. But, opinion without fact is fiction.  You see, so many of us have no historical knowledge of what has “REALLY’ happened during our lifetime. So, here it is in Black and White. MiseryIndex

When was the U.S. at the height of the “Misery Index”? 1981.  During the Carter Administration. The Inflation rate was over 20%. Mortgage rates were in the “teens”. Ironically, the dollar was strong.  I studied in Europe that year and lived like a queen for a mere pittance!

When was unemployment at an all time high? 1983. The early Reagan years. It was over 10% for the only time in those 38 years. Since then, statistics show, we have become increasingly “less miserable”.

When was the U.S. the “least miserable”?

Two years ago, during the current Bush administration. With unemployment below 5%, along with the lowest rate of inflation, combined with “cheap money” in the mortgage industry, life was good. And, the “misery index” TODAY, shows we are still below the “MISERY” level at the beginning of ANY previous presidential term, dating back to Richard Nixon.  Those are the facts. 

Historical facts, not political opinion. Good information for all Americans.

Yes, Americans are feeling the “pinch”, as is the Tampa Real Estate Market.  It ’s too bad our memories don’t serve us as well, because the numbers prove us wrong! We are not REALLY miserable, history tells us that!

As always, I present the facts, and welcome your thoughts, every day, on The Real Estate Sizzle!

 

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This entry was posted on Friday, June 13th, 2008 at 11:57 am and is filed under Jackie Colson-Miller, Real Estate News, Real Estate Trends, Tampa Real Estate Agent, Tampa Real Estate Market. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

3 Responses to “What is The “Misery Index” and Are We Really “Miserable” in 2008? Tampa Real Estate News and More!”

  1. Roberta Murphy Says:
    June 13th, 2008 at 1:45 pm

    Jackie:

    Great information for our entire country. We have become a society of gloom and doomers.

    Tampa is lucky to have your real estate sizzle!

  2. Mary Ann Crane Says:
    June 14th, 2008 at 12:11 pm

    Jackie, what almost all Americans lack is an historical perspective. We are just now talking about public transportation and asking why doesn’t America have the high-speed trains and other infra-structure that is seen elsewhere in the developed world. Well, back in the 70’s, when we had the first oil shock, Europe and Japan - who have no oil of their own - dedicated themselves to developing those mass-transit alternatives. We were smug and short-sighted, so here we are whining and complaining.

    An historical perspective provides a sense of scale. I was working for U.S. Home here in Tampa in 1980, when mortgage rates were in the double digits and rising rapidly. That was horrible! If a new construction house didn’t get a Certificate of Occupancy on time, the buyers would lose their interest rate lock, and either have to buy down the rate out of their cash or sometimes forfeit the house.

    Later, when I first got into real estate, we cheered when rates dropped below 8% for the first time in forever.

    Somehow, we keep telling outselves that “this time” is different and deluding ourselves that the good times can never end. How about dealing with the fact that all good things come to an end and we should prepare for that event while things are still good? We don’t have 20/20 hindsight; we have blind hindsight!

    Excuse me; I just ranted!

  3. Derek Says:
    June 14th, 2008 at 1:00 pm

    Jackie,

    I’m glad you wrote this post. I researched how CPI and unemployment is calculated and found some interesting information.

    I have a few differing opinions about the MI’s ability to gauge how people are really feeling, but I agree with you about feeling a bit of a pinch.

    I’ve been collecting thoughts and tips from readers of my blog on ways to save some money during a tight economic pinch in a “chin up” effort, so that we don’t focus on the negative but instead try to be proactive to deal with the situation.

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