In Paul Krugman’s Upper West Side Bubble, All Is Well

Paul Krugman said that the big problem with the economy today is that media are unfairly writing negative stories about it. "I think that what's happening now is that there's been a kind of a negativity bias in coverage," he said. Then Krugman went full Kael, telling CNN's Brian Stelter, "if you ask people, 'How are you doing?'

Krugman needs to talk to the people.

• If he talked to families struggling to make ends meet, or find baby formula, or pay their rent, he'd get a far different response than "pretty upbeat."
• Out here in the real world, they've watched things go from bad to worse.

The IBD/TIPP Economic Optimism Index is currently at 38.5

• Anything under 50 signals pessimism
• It's been in negative territory for 11 months
• TIPP's Financial Stress Index, meanwhile, has climbed from 61 in Biden's first full month in office to 69.3
• A reading over 50 equals more financial stress
• And several polls show that a majority of the public believes we are in a recession right now
• The only thing that Krugman and other leftists can point to as evidence that the economy is just hunky dory is the unemployment number, which has held at 3.6% for the past four months. The unemployment rate is that low only because more than 4 million people have dropped out of the labor market since January 2020.

2001: “For the first time in a decade, our economy is in recession. It's not official yet - the group that dates recessions doesn't act until after the fact - but there's little doubt that we're in the midst of a downturn."

• Jared Bernstein
• The downturn is already taking a toll on those who traditionally bear the brunt of recessions, blue-collar workers in manufacturing, minorities, and other less-advantaged workers.

What is a recession?

• While some maintain that two consecutive quarters of falling real GDP constitute a recession, that is neither the official definition nor the way economists evaluate the state of the business cycle.
• Biden's Treasury Secretary Janet Yellen, meanwhile, insisted that "This is not an economy that's in recession. But we're in a period of transition in which growth is slowing."

The White House insists that we need to look at the bigger picture

• Real wages are in decline thanks to double-digit inflation
• Millions of people have dropped out of the labor force since Biden took office
• Consumer confidence is hitting record lows
• Interest rates are climbing
• Polls show that most people believe we are in a recession

https://issuesinsights.com/2022/08/02/in-paul-krugmans-upper-west-side-bubble-all-is-well/