Description

The Misean Stationarity Index (MSI) is a financial metric derived from the principles of Austrian economics and similar to the Equity Q Ratio, which is similar to the Faustmann Ratio. The MSI is referenced by Mark Spitznagel in his book, The Dao of Capital.

The unscaled Misean Stationarity Index (MSI) can be thought of as a barometer of the stock market. Under ideal conditions, the MSI equals 1, where equity is equal to net worth. When the value deviates from 1, it indicates the market could be either over and or under valued.

Equity and net worth values for the US economy are computed by the Federal Reserve, published on the balance sheet of nonfinancial corporate businesses on lines 39 and 42 and made available via FRED.

Data Sources

• Balance Sheet of Nonfinancial Corporate Business from Federal Reserve Economic Database (FRED)