Why Paul Krugman Says Media May Have Missed The 'Pretty Good Reality' Of Economy Under Joe Biden

Nobel laureate and noted economist Paul Krugman has highlighted the growth in the economy during the Biden administration noting that the media has missed the "pretty good reality."

“So, if your picture of the economy came entirely from headlines and cable chyrons — which is probably true for many — would you know that the economy has grown 6.7% under Biden so far and inflation for the past 6 months was 1.9%?” Krugman tweeted.

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Krugman’s tweet follows the release of the fourth quarter U.S. GDP number on Thursday that showed the economy grew by an estimated 2.9% against expectations of 2.6% growth, leading to gains on major Wall Street indices. The SPDR S&P 500 ETF Trust SPY closed 1.1% higher, while the Invesco QQQ Trust Series 1 QQQ gained 1.95%.

“We can talk about possible future recession, and about how underlying inflation may be higher than headline. But that's speculation rather than reporting, and arguable at the very least. Hard to argue against the proposition that media have missed the pretty good reality,” Krugman said.

Last week, he explained how the big deceleration in inflation during the second half of 2022 “hasn't broken through to public consciousness” as scores of people still think price rises are running wild.

Money Supply: The fight against inflation that led to aggressive rate hikes by the Federal Reserve has led to a decline in the M2 money supply, the central bank’s main measure of the country’s money stock. It fell for a fifth straight month in December, declining by a record $147.4 billion to a seasonally adjusted $21.2 trillion from the month before, reported Reuters, citing data from the central bank.

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Photo via Commonwealth Club on Flickr