This chart, aptly titled, imposes significant stress on readers. The key message appears to be that "misery" as defined by Merrill Lynch has increased sharply in the United States in the last decade, vaulting it to first place amongst G7 nations.
That conclusion is an unfortunate misreading of the data. Keen readers will notice that the absolute U.S. index increased only by 3 points yet the U.S. rank dropped from 2nd best to worst.
To add to the confusion, the two sides of the bar chart utilized different scales. For example, Germany's bar (18 on the left) is about 1/3 the length of U.S.'s bar (18 on the right). And the fact that Japan's left bar (4) appeared longer than its right bar (6) and about the same length as U.S.'s left bar (15) indicated sloppy editing.
In other words, this is a chart not worthy of a fine publication.
- Misery has declined in all countries except U.S. and Japan
- Misery has increased in the U.S. but its drop to the bottom should be attributed mostly to sharp improvements in other G7 nations
- The spread in the misery index has halved from 24 = 28-4 to 12 = 18-6
Further insights can be obtained if we have data for the intervening years.
A key characteristic of a good chart is low stress factor and the inapt published chart failed this test.
Reference: " Why Investors Don't Live by Current Bets Alone", New York Times, Dec 25, 2005.
P.S. I'll gradually resume regular posting this week as I fight off jet lag.