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Force Majeure Markets~ How long can this Alice in Wonderland Market ignore the numbers?
President Carter and his stagflation oil shock from his Department of (Less) Energy, took the Misery Index, inflation plus unemployment, from 13% to 22%.
Carter said no President with a 13% Misery Index like Ford deserved reelection. He got his wish, twice.
(Remindful of President Obama saying similar about not being reelected with a bad economy and high unemployment, as a cold war with China and Russia in the Middle East resurfaces with appeasement foreign policies.)
http://en.wikipedia.org/wiki/Misery_index_economics
The interesting thing is like GDP and Unemployment, the Misery Index and Crime Rate correlate, with the Misery Index leading the Crime Rate by about a year.
The Misery Index went down drastically, from 20 to 10 under Reagan. This was the result of policies spearheaded by one of the few Americans to study Economics in college, star in Hollywood, run a Union and the State of California, and implement Austrian credit cycle free market economics as President.
The Misery Index started at 8 under Obama and so far rose as high as 13% in December 2009. Thus Crime rates may also rise.
GDP went from a peak 8% under Reagan to -6% last year under Obama.
Unemployment may also rise.
Like other government statistics that strive to eliminate the negative and accentuate the positive, official GDP is released as an annualized rate of change for only the most recent quarter.
This can mean, as we saw for the last two quarters, a positive number, when in fact the annual change is still negative.
More recently, the annual growth in real GDP was -6%, not the 6% revised report for the 4th Quarter of 2009.
That is a significant 12% difference.
Buyers beware.
