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It's still the economy, stupid.



June 27, 2008 – Comments (4)

With this new two year low in the stock market, I will be interested in seeing how it will affect the upcoming election.

 One thing I will be looking at is the "misery index".  If the four-year annualized inflation rate and the unemployment rate add to more than 9.5%, then McCain is in serious trouble.  Not his fault, but history shows that a "throw the bums out" mentality will occur for the Republicans if this nonsense continues.  We can talk economic indicators all day, but if families cannot afford their personal living demands and jobs are difficult to find, they will take it out on someone.  Right now, the Republicans are the target.

 I will share more on this topic in the coming weeks.

4 Comments – Post Your Own

#1) On June 27, 2008 at 6:30 PM, Tastylunch (28.71) wrote:

dude McCain is in serious trouble no matter what happens re: misery index. Obama is going to smoke him in the debates just due to age/charisma factors for better or for worse.

Obama imo has to really seriously screw up to lose.

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#2) On June 28, 2008 at 5:14 PM, ThomasPound (82.34) wrote:

I am not so sure.  Dukakis and Kerry have reminded me not to be so cocky.  The problem is that McCain, as a member of the controlling party in the White House, goes into the election with a 7.66% advantage.  So, it appears that a misery index above 10 will be necessary for Obama to win.  Let's face, voters will vote their pocketbooks before all else.

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#3) On August 23, 2008 at 5:39 PM, ThomasPound (82.34) wrote:

The announcement of Joe Biden as Obama's running mate allows me to return to this topic.  This is what I have as important indicators:

With an unemployment rate of 5.7% and a running inflation rate of 3.9%, the misery index stands at 9.6%.  This is higher than the 8.5% misery index in 2004.

The stock market has seen a 3.6% annualized growth since 11/01/2004 which is substantially better than the 4.0% annual decline for the period between 2000 and 2004.

The annualized "Real" GDP growth is at 2.3% which is slightly better than the period between 2000-2004.

Inspite of the of improvements in the stock market and GDP, the misery index is enough to show that Obama would have a 1.3% advantage if the election were held today.  This seems to be consistent with the Gallup tracking poll. 

Despite the gnashing of teeth regarding the economy, the current state of the economy compared to four years ago still gives McCain a chance to pull off a big upset.


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#4) On October 17, 2008 at 9:22 AM, ThomasPound (82.34) wrote:

I am ~2 weeks from making a formal election night prediction.

As I see it now, Obama will win by 5.8%.  Unemployment is 6.0%, running inflation is 3.6% and the stock market is down 5% annualized over the last four years.  While McCain has an advantage by being a member of the controlling party, these economic factors show Obama as the clear winner.

We will see how close I can get.

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