LARRY: HELLO, EVERYONE, WELCOME
TO "KUDLOW."
I’M LARRY KUDLOW.
HAPPY MONDAY, FOLKS.
SO OVER THE WEEKEND ON VARIOUS
NEWS SHOWS WE SAW VARIOUS BIDEN
COMMUNICATORS DEFEND INFLATION
AND THE ECONOMY AND THE
4 TRILLION-DOLLAR SOCIAL WELFARE
ENTITLEMENT SPENDING, FOSSIL
FUEL DESTROYING BILL THAT THEY
ARGUE WILL REDUCE SKYROCKETING
INFLATION.
IT’S A TOUGH JOB ARGUING MORE
SPENDING WILL HOLD DOWN
INFLATION OR THE MUCH HIGHER
TAXES WILL STIMULATE THE
ECONOMY.
OR, THERE IS NOTHING THEY CAN DO
ABOUT HIGH GASOLINE PRICES.
THAT IS EXCEPT TO ALLOW AMERICAN
PRODUCERS TO PRODUCE.
BUT THE FUN THING ABOUT THE
BIDEN DEFENSE THAT THIS BIG
GOVERNMENT SOCIALIST BILL WILL
ACTUALLY LOWER INFLATION IS THAT
OUTSIDE OF THE WHITE HOUSE AND
THE EXECUTIVE BRANCH OF THE
BIDEN ADMINISTRATION THERE IS NO
LIVING HUMAN BEING THAT AGREES
WITH HIS VIEW.
NO ONE.
JUST CHECK OUT THE POLLS.
JUST CHECK OUT THE LIBERAL
POLLS, LIKE
"THE WASHINGTON POST" POLL.
RIGHT AFTER THE INFRASTRUCTURE
BILL WAS PASSED LAST WEEK,
BIDEN’S JOB APPROVAL SUNK TO 41%
WITH A ROARING 39% APPROVAL ON
THE ECONOMY.
REPUBLICANS EVEN HAVE A 10 POINT
LEAD IN THE GENERIC BALLOT FOR
CONGRESS.
NOW, IF WAPO IS POSTING THOSE
KINDS OF NUMBERS, I WOULD SAY
THAT IS A BIT OF A WARNING TO
THE BIDENS THOUGH IT APPEARS
THEY’RE NOT HEARING IT.
NOW WE’VE HAD A LOT OF SPENDING,
ABOUT 4 TRILLION OF EMERGENCY
SPENDING LAST YEAR, WHICH I
THOUGHT LAST YEAR WAS IN THE
MAIN, NECESSARY.
WE’VE HAD SO FAR 3 TRILLION IN
SPENDING HOWEVER THIS YEAR WITH
ANOTHER 4 TRILLION ON THE WAY IN
A RELATIVELY STRONG ECONOMY.
AND THIS IS EXCESSIVE SPENDING
ASSOCIATED WITH INFLATION.
BY VIRTUALLY THE ENTIRE
ECONOMICS PROFESSION.
AGAIN, OUTSIDE OF THE EXECUTIVE
BRANCH OF THE BIDEN
ADMINISTRATION, I WOULD SAY
THEY’RE IN SOMETHING OF A
POLITICAL PICKLE.
EVERYONE AGREES MORE SPENDING IS
CAUSING INFLATION.
NOW, THE ONLY KIND OF, SORT OF,
MAYBE TRUTH TELLER ON
YESTERDAY’S SHOWS WAS TREASURY
SECRETARY JANET YELLEN.
NOW SHE BLAMED THE INFLATION ON
THE COVID PANDEMIC.
AND I THINK THERE IS SOME TRUTH
TO THAT ASSERTION BUT NOW SHE’S
TAKING A DECENT IDEA WAY TOO
FAR.
HER NEW ARGUMENT IS THAT WE
WON’T SEE AN END TO INFLATION
UNTIL WE SEE AN END TO THE
PANDEMIC.
BUT THE PANDEMIC IS ENDING.
THE VIRUS WILL NEVER END BUT THE
POINT IS I DON’T WANT TO ARGUE
SCIENCE HERE.
THE POINT IS THE ECONOMY HAS
REOPENED AND IT WILL REMAIN
REOPENED AND YES, IN THE SHORTER
TERM ECONOMIC DEMAND IS
OUTSTRIPPING ECONOMIC SUPPLIES.
THERE IS NO EXCUSE FOR UNION
RULES AND GOVERNMENT REGS THAT
STOP THE PORTS FROM OPERATING
24/7 BUT AFTER 10 MONTHS DEMAND
AND SUPPLY SHOULD BE IN MUCH
BETTER BALANCE.
PRICES SHOULD ALREADY STABILIZED
BUT THEY’RE STILL SKYROCKETING.
SO THERE IS TWO MISSING LINKS
HERE.
ONE, MS. YELLEN IS NOT FESSING
UP THAT ALL THE GOVERNMENT
SPENDING IS STIMULATING EXCESS
DEMAND.
THAT’S AN EASY ONE.
DEMOCRAT LARRY SUMMERS HAS THAT
RIGHT.
SO HAVE A NUMBER OF REPUBLICAN
ECONOMISTS.
AND MS. YELLEN KNOWS BETTER THAN
TO DENY THIS.
SHE IS A VERY SMART LADY.
THE EMERGENCY HAS BEEN OVER FOR
10 MONTHS, MAINLY 11 MONTHS.
HENCE FORTH THE EMERGENCY
SPENDING SHOULD BE OVER BUT IT
IS NOT.
SECOND, THE EMERGENCY FEDERAL
RESERVE PUMP PRIMING AND MONEY
CREATION SHOULD HAVE BEEN OVER
10 MONTHS AGO.
QUANTITATIVE EASING AND FREE
MONEY SHOULD HAVE STOPPED LAST
WINTER.
NOW PUTTING THE TWO POINTS
TOGETHER IT’S THE EXCESSIVE FED
THAT IS FINANCING THE EXCESSIVE
FEDERAL GOVERNMENT SPENDING AND
THAT IS A LETHAL SITUATION FOR
HIGHER INFLATION.
NOW, COMING BACK TO MS. YELLEN,
SHE SAYS SHE THOUGHT THE
INFLATION WOULD STOP IN THE
SECOND HALF OF NEXT YEAR!
THAT’S A NEW FORECAST.
I HAVE NO IDEA IF IT WILL BE
TRUE BUT I GIVE HER CREDIT FOR
BEING REALISTIC INSTEAD OF HER
OTHER COLLEAGUES WHO ARE SELLING
BALONEY.
NOW ENTER JOE MANCHIN.
FOLLOW ME ON THIS.
THIS GUY IS NEAR HEROIC.
HE OUGHT TO RUN FOR PRESIDENT
BECAUSE HE KEEPS SAYING THAT WE
SHOULD PAUSE ANY NEW SPENDING
UNTIL THE INFLATION IS BROUGHT
UNDER CONTROL.
NOW MS. YELLEN IS SAYING, SECOND
HALF OF NEXT YEAR.
SO I’M WAITING FOR
SENATOR MANCHIN TO SAY ED BE
HAPPY TO CONSIDER ANOTHER
SPENDING BILL BUT NOT UNTIL THE
SECOND HALF OF NEXT YEAR IN
ACCORDANCE WITH THE APOCRYPHAL
FORECASTING OF OUR NATION’S
TREASURY SECRETARY.
SHE IS THE THOUGHT LEADER AND HE
WOULD BE APPLYING HER THOUGHT.
REPUBLICANS OUGHT TO JUMP ON
THIS BANDWAGON.
WE HAVE A SEMIAUTHORITATIVE FROM
THE LEADING ECONOMIC
POLICYMAKER.
WHO KNOWS, MS. YELLEN MAY BE
RIGHT BUT MORE IMPORTANTLY WE
SHOULD FALL INTO LINE WITH HER
VIEW.
IN FACT HER BOSS SHOULD FALL
INTO LINE WITH HER VIEW.
NO NEW SPENDING UNTIL AT LEAST
THE SECOND HALF OF NEXT YEAR.
I’M CALLING THIS THE
MANCHIN-YELLEN HYPOTHESIS.
I’M BRINGING THEM TOGETHER.
THEY WILL MAKE A LOVELY COUPLE.