'Misery Index' Hits 28-Year High

Ballooning prices and painfully high unemployment have created a miserable economic reality for many Americans -- the worst in more than 28 years, according to one gauge.

The "misery index," an informal measure derived by adding the national unemployment rate to the year-over-year change in consumer prices, rose to 13 in September from 12.9 in August. That reading compares with 10.7 in the same period last year when the unemployment rate weighed in at 9.6%, higher than the September reading of 9.1%, but inflation was a more modest 1.1%.

While the index is certainly elevated, it doesn't come close to matching the levels it hit during President Jimmy Carter's term in the 1980s.

It isn't just the informal misery index that has shown weakness in the consumer sector; the University of Michigan/Reuters survey of consumer sentiment released last week showed outlook fell to a 30-year low in early October.

Many economists fear that what is bad for consumers may also be damaging for the broader economy.  That is because consumers often make buying decisions based on how confident they are in the future, meaning waning confidence could set off a dangerous negative feedback loop.

The chart below, compiled by FOX Business, shows how the misery index has fared since 1980.