On a monthly basis, core PCE inflation was down to 2.0%, which is the Fed’s target rate. Headline inflation was even better, clocking in close to zero.
On a year-over-year basis, headline inflation came in at 3.0% and core inflation at 3.5%.
POSTSCRIPT: Now that inflation is going down instead of up, I notice that neither the New York Times nor the Washington Post even bothers to report it on their front page. Even the Wall Street Journal mentions it only under a headline about consumer spending slowing down. And we wonder why people don’t seem to know that inflation is way down?
I’m very sick of hearing excuses that the reason people say the economy is bad is because they just don’t “feel” it. They do. They’re spending like crazy. The problem is that when people are polled they reflect the conventional wisdom which they get from the media. The right wing media will never tell the truth about this. But there is no excuse for the way the MSM is covering this story.
I highly recommend clicking over to Brian Beutler’s newsletter for a thorough analysis of what’s going on with this and how it can be remedied. Here’s a excerpt:
I’m not saying you have to believe the economy is good, or that it has necessarily been good for you personally. Just that the economic challenges the country faces today are much less severe than they’ve been in the past, when economic sentiment was somehow better. Across all major indices, including inflation (now basically kicked), unemployment, and interest rates, our problems have been worse in prior eras without running public opinion this deep into the dirt. Wish mortgage-interest rates were lower? Well, they’ve been higher in the past, again without creating mass despair.
Everyone should be a bit puzzled by this, and everyone should want to understand it, even if only because it’s fascinating. Democrats (and really everyone who wants to stop Donald Trump) should be particularly interested, because a) making big macroeconomic policy changes under divided government is nearly impossible, and b) even if it were easy, the phenomenon itself suggests people aren’t really responding mechanistically to specific hardship indicators. Gas prices are currently way down! And yet…
Which is to say, the best hope for arresting and reversing the sentiment probably doesn’t lie in tweaking policy but in changing mass conventional wisdom. That doesn’t mean condescending to the minority of people who really are struggling by telling them that they’re imagining things. It means reaching people who say things like “everyone knows the economy sucks” (it doesn’t) the same way they might say “everyone knows Sinbad starred in a movie called Shazaam” (he didn’t, there is no such movie), and convincing them they’ve got bad information.
[…]
Mainstream media has become addicted to emphasizing plucking bad economic news from the surfeit of good data, and sniffing out stories of distress rather than the larger number of happy anecdotes (e.g. expensive groceries, rather than all the raises people have gotten to make those same groceries affordable). In some cases they just mislead news consumers about what the data means.
And then there’s the even more passive phenomenon of consensus wisdom bouncing around in an echo chamber. The writer of one of my favorite Twitter accounts recently observed, “Just the other day I was incidentally listening to a pledge drive and part of the pitch was ‘I know it is hard to give money in these trying times, but…’ and I think a deluge of that kind of talk has *got* to affect people. But it’s not the same as, say, watching Fox News.” […]
He takes an in-depth look at the polling that is completely disconnected from economic reality, particularly among the young. I think he may be on to something here (or at least it’s one of the few hypotheses I’ve seen that may usefully explain what’s happening.) He looks at the numbers showing that young people are more negative about the economy than Fox viewing Republicans (what?) and shares a theory I haven’t heard before:
I have another, underbaked theory: that what we’re seeing in youth public opinion are the metastases of a long-run strategic effort (well-intentioned though it was when progressives first adopted it) to use climate alarmism to mobilize young people into politics. It seemed like it could only work one way: note that without change the climate future is bleak, then observe that only one of our two parties believes in climate change. Make young people upset, harness their anxieties, and that’s millions of voters who’ll stay active in politics and vote progressive for life.
Reflecting now from my front row seat to the Gen Z doom spiral, it suddenly seems obvious how that could go awry. How we might have deluded ourselves into thinking existential despair could be easily harnessed for good, without curdling into nihilism.
Biden’s economic approval among the young looks like what you’d get if the president had four years, and only four years, to fix every problem in the economy—and if he failed or didn’t try it meant the future was ruined. But that’s the logic of climate doom applied to the economy.
It’s also perfectly compatible with the idea that young people (like Republicans) inhabit social milieus where everybody just knows the economy sucks. Young people may not be getting their news from CNBC (for that we give thanks) but they do rely on platforms where catastrophism has a leg up over careful assessment of evidence. Why should we be surprised that their political sentiment has come to resemble what the algorithms encourage?
That’s exactly what I see in my personal life and on social media but it’s not only in young people. Nihilism is a defining characteristic of our age and it isn’t just on the right although that’s where it’s really dominant. It’s disturbing to say the least.
Beutler’s great newsletter called Off Message is here. I encourage you to read the whole thing.
