WE’LL SEE YOU TOMORROW.
♪.
LARRY: HELLO, FOLKS, WELCOME TO
"KUDLOW," I’M LARRY KUDLOW.
IN CASE YOU MISSED IT, HERE’S
PRESIDENT BIDEN YESTERDAY ON THE
SOUTH LAWN OF THE WHITE HOUSE AS
HE IS ABOUT TO HOP INTO HIS
HELICOPTER AND HE IS RESPONDING
TO A QUESTION.
PLEASE TAKE A LISTEN.
>> MR. PRESIDENT WHAT IS YOUR
MESSAGE WHAT IS YOUR MESSAGE TO
LEADER McCARTHY?
TO SPEAKER McCARTHY, SORRY,
SIR, WHAT IS YOUR MESSAGE.
>>
PRESIDENT BIDEN: SHOW ME YOUR
BUDGET I WILL SHOW YOU MINE.
LARRY: SHOW ME A BUDGET, AND I
WILL SHOW YOU MINE.
THAT IS NOT SERIOUS QUESTION TO
A REPORT’S QUESTION.
BIDEN CONS TO STONEWALL KEVIN
MCCARTHY HE WILL NOT NEGOTIATE
ON THE DEBT LIMIT.
KEVIN MCCARTHY WANTS A SIT DOWN
WITH THE PRESIDENT TO REACH A
COMPROMISE ON SPENDING AND
BORROWING.
AS YOU KNOW THE TWO WILL MEET IN
THE WHITE HOUSE TOMORROW.
THERE IS TREMENDOUS URGE AGAIN
SY FOR THIS MEETING BECAUSE THE
ECONOMY IS STEADILY LOSING
ALTITUDE AND IS HEADING INTO
RECESSION.
A BUDGET DEAL MIGHT HOLD
CONFIDENCE FOR THE FUTURE OF
NORTHERN INFLATIONARY ECONOMIC
REBOUND.
SO MANY INDICATORS, CURVE UPSIDE
DOWN, SHORT TERM RATES
DETERMINED BY THE FED WAY ABOVE
LONG TERM RATES DETERMINED BY
THE MARKET.
LEADING INDICATORS KEEP
FLUNKING.
M2 MONEY SUPPLY.
WITH COVID STIMULUS OUT OF THE
WAY THE PERSONAL SAVINGS RATE
FALLEN SIGNIFICANTLY.
CONSUMER SPENDING DECLINED IN
NOVEMBER AND DECEMBER.
CONSUMER CONFIDENCE CONTINUES TO
SLIDE.
NEW NUMBER TODAY WAS DOWN.
PEOPLE LIVING TO PAYCHECK TO
PAYCHECK.
THIS IS SOMETHING.
THEIR MONEY, ACTUAL EXPENSES ARE
RISING FASTER THAN THEIR
INCOMES.
THIS IS NOT GOOD.
IT IS HAPPENING ACROSS THE
BOARD, ACCORDING TO THE MORNING
CONSULT POLL, LISTEN TO THIS 28%
OF AMERICANS MAKING LESS THAN
$50,000 A YEAR ARE SPENDING MORE
THAN THEY EARN, 28%.
THAT IS A BIG NUMBER.
YOU GO UP THE INCOME SCALE,
BETWEEN 50 AND $100,000 A YEAR,
14% SPENDING MORE THAN THEY
EARN.
IF YOU GO ABOVE $100,000, ALMOST
10%.
IT IS NOT A GOOD SIGN.
BANKS ARE INCREASING LOAN-LOSS
RESERVES.
THAT IS OKAY.
THEY’RE CAPITAL POSITIONS ARE IN
GOOD SHAPE BUT OF COURSE WITH
RISING INTEREST RATES ON CREDIT
CARD DEBT AND MORTGAGES, THE
PRUDENT THING TO DO, GOOD FOR
THEM.
NOW UNEMPLOYMENT REMAINS LOW AT
3 1/2% WHICH IS GREAT, BUT HOURS
WORKED FELL IN NOVEMBER AND
DECEMBER AND THAT IS NOT A GOOD
SIGN.
IN THE RECENT GDP REPORT,
BUSINESS EQUIPMENT INVESTING
FELL SIGNIFICANTLY WHICH IS MOST
UNFORTUNATE BECAUSE THAT’S A
PRODUCTIVITY DRIVER BUT OUTPUT
PER HOUR, PRODUCTIVITY IS
FALLING, EVEN WHILE PEOPLE ARE
WORKING LESS.
ALL THAT IS NOT GOOD.
HOUSING IN DEEP RECESSION
ALREADY, ALMOST NO END IN SIGHT.
AND THE INFLATION STORY HAS
IMPROVED WITH THE FED’S FAVORITE
MEASURE, THE PERSONAL CONSUMER
DEFLATOR SLOWING TO 5% YEAR TO
YEAR.
4.4% EXCLUDING FOOD AND ENERGY.
THAT IS GOOD PROGRESS.
HOWEVER, IT IS STILL OVER TWICE
THE FED’S 2% TARGET.
MEANWHILE FOR TYPICAL AMERICAN
FAMILIES, KEY PRICES CONTINUE TO
RISE RAPIDLY.
FOR EXAMPLE FOOD AT HOME, UP
NEARLY 12%.
AWAY FROM HOME, OVER 8%.
NOW MOST ENERGY, CERTAINLY
GASOLINE PRICES HAVE COME WELL
OFF THEIR PEAKS BUT EVEN AT
$3.50 AT THE PUMP ON AVERAGE
NATIONWIDE, EVEN THAT IS WELL
OVER A DOLLAR HIGHER THAN IT WAS
BACK IN 2021.
BASICALLY, INFLATION FROM
OVERSPENDING TWO YEARS AGO AND
LAST YEAR HAS WRECKED THE
ECONOMY.
BIDENESQUE BIG GOVERNMENT
POLICIES THAT WERE COMPLETELY
UNNECESSARY STUFFING DOLLAR
BILLS INTO FAMILY BANK ACCOUNTS,
THAT IS POINT NUMBER ONE, POINT
NUMBER TWO, THE FEDERAL RESERVE
CAUGHT UNAWARE WITH ITS PANTS
DOWN.
THEY MONETIZED ALL THE FEDERAL
DEFICITS AND BORROWING.
EVERYBODY WAS IN DENIAL.
THEN CAME TWO NEGATIVE QUARTERS
AND LAST YEAR’S FIRST HALF.
THAT WAS A BIG WARNING.
NOW, DESPITE SOME TEMPORARY
GROWTH ALL THESE INDICATORS I
JUST MENTIONED ARE UNFORTUNATELY
POINTING SOUTH.
INFLATION IS STILL TOO HIGH,
INTEREST RATES HAVE SHOT UP.
THE FED HAS PULLED LOTS OF CASH
OUT OF ECONOMY, BUT
OVERREGULATION HAS FOUGHT A WAR
WITH OIL AND GAS AND FRANKLY ALL
BUSINESS.
HOUSING IS DOWN, CONSUMERS DOWN,
BUSINESS INVESTMENT DOWN.
DECLINING CORPORATE PROFITS
COULD BE THE NEXT SHOE TO FALL.
LOOK, WE’VE HAD A GOOD EARLY
YEAR STOCK MARKET AND I ALWAYS
LOVE TO SEE RISING STOCKS BUT I
NEVER TRY TO OUTGUESS THE
MARKET.
I’M A LONG-TIME BELIEVER IN
STOCKS FOR THE LONG RUN.
BUY THE S&P INDEX, USE CHEAPEST
WAY AVAILABLE.
DO NOT TRY TO OUTGUESS SHORT
TERM WIGGLES I BEG YOU.
FEDERAL RESERVE UNFORTUNATELY
WILL STAY TIGHT FOR QUITE
SOMETIME.
CHANCE OF RECESSION IS
UNFORTUNATELY WELL OVER 60%.
THAT IS FOR THIS YEAR, I MIGHT
ADD.
THESE ARE ALL REASONS, HERE IS
MY KEY POINT, TO LIMIT
GOVERNMENT, CUT SPENDING, LOWER
TAXES, MINIMIZE REGULATIONS IN
ORDER TO GENERATE A BIG
RECOVERY.
I WANT FREE ENTERPRISE
PROSPERITY, NOT BIG GOVERNMENT
STAGNATION.
SO, YOU KNOW WHAT’S COMING, SAVE