Nobel laureate Paul Krugman doubled down on his stance that the U.S. is now seeing disinflation and took an interesting example to make his case.
What Happened: On Saturday, Krugman shared a video clip of Donald Trump’s speech shared by MeidasTouch.com senior digital editor Acyn Torabi, in which the former president slammed Democrats for opposing voter IDs while requiring pictures of attendees at the Democratic National Convention.
In the video, Trump also insisted that “you have voter ID to buy a loaf of bread.”
Commenting on the clip, Krugman said, “One funny thing about this particular delusion — which Trump has seemed stuck on for a long time — is that those of us pointing to disinflation are constantly accused of being out of touch because we never buy our own groceries.”
Setting the record straight, the economist said he does his own grocery shopping and that one doesn’t need to show ID unless they are buying alcohol.
While conceding that groceries now cost a lot more than they did before Russia’s invasion of Ukraine, Krugman said that, after prices of goods went up last year, only certain goods have seen price increases lately. Prices of items such as eggs have been going down, he said.
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Sharing a St. Louis Federal Reserve’s inflation chart based on data from the U.S. Bureau of Labor Statistics, Krugman said, “In other words, my personal experience more or less matches what official data are telling us.”
Krugman Slams Disinflation Deniers: Just as there were “inflation truthers” in the early 2010s who insisted that official numbers were hugely understating price increases, there are currently disinflation deniers who refuse to believe inflation is coming down, Krugman said.
“There are a number of ‘tells’ that much of this is political, a refusal to admit that anything might be going right under [Joe] Biden,” the economist said. Sharing an example, he said there are self-proclaimed “regular people” who complain about how much goods cost at Whole Foods or “people still going on about the soaring prices of eggs, which have in fact come way down this year.”
“I’d say that such people don’t actually buy groceries, but more likely they’re basically engaged in tribalism pretending to be observation,” he said.
In a post earlier this week, Krugman said a measure he uses that excludes lagging shelter, used cars, food and energy adds to the evidence that inflation has been largely defeated.
The economist recently called for the Federal Reserve to raise its inflation target from the 2% ceiling for the annual rate of core consumer price inflation.
The iShares TIPS Bond ETF TIP, an exchange-traded fund that seeks to track the investment results of an index composed of inflation-protected U.S. Treasury bonds, ended Friday’s session down 0.25% at $105.11, according to Benzinga Pro data.
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