MSNBC host Stephanie Ruhle called upon the president of Chicago’s Federal Reserve to tell viewers that they are economically far better off than they think.
"We need an economic explainer," the MSNBC host said. "People are confused, they’re exhausted, but they’re also doing quite well."
Ruhle, who hosts MSNBC’s "The Eleventh Hour," had been discussing a recent Federal Reserve report that "shows people are still struggling to cover day-to-day expenses, even as inflation has slowed." She noted how some major brands are responding by enticing consumers with slashed prices, "Target says it is cutting prices on 5,000 essential items, things like milk, butter, pet food. Wendy's is now offering a $3 breakfast deal. And rivals like McDonald's are offering new lower-priced value meals."
She enlisted Austan Goolsbee, the president and CEO of the Federal Reserve Bank of Chicago, to tell her viewers about the current state of the economy, noting to Goolsbee, "Lots of things that were not considered luxuries before now are, because things have gotten expensive. However, we have more purchasing power today than we did in 2019. What’s going on with the American consumer psyche?"
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"There’s never a bigger difference between the vibes and the actual numbers than we’re facing right now, and I don’t think we totally understand that," Goolsbee said. "Maybe it’s rooted in a little bit if you ask people ‘How is your personal situation?’ and they say ‘Pretty good,’ ‘How is the national economy?’ They don’t like it at all. I think a lot of it comes from inflation being very unpopular and there is a bit of a lag behind conditions."
The president of Chicago's Federal Reserve Bank continued, saying the whole situation has "kinda got these cross-currents going, there’s some things that are very strong in the economy, there’s some things that are very aggravating in the economy, and that melts into a little bit of this vibe situation where people are more upset than what you would think they would be when the unemployment rate is low and the economy is growing."
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When asked, Goolsbee said that he feels "good" about major consumer brands slashing prices.
"You’ve had inflation that got too high in the U.S. and in other countries around the world," he said. "Incomes didn’t keep up with that, now inflation has slowed in 2023, actually quite a lot. Inflation came down almost as much as it has ever come down, and we didn’t have a recession while that was happening, which was quite unusual. But prices are still higher than what they were before, and so you see people complaining about that."
He elaborated further, "Food inflation is more volatile, it’s more up-and-down than other inflation, so in a way it’s good to see, and I’m not surprised to see that you’re seeing a little deflation on the food side. Because that got way up before in the years previous to [2023] as well."
High inflation has created severe financial pressures for most U.S. households, which are forced to pay more for everyday necessities like food and rent. Grocery prices are up more than 21% from the start of 2021, while shelter costs are up 18.37%, according to FOX Business calculations. Energy prices, meanwhile, are up 38.4.%.
FOX Business' Megan Henney contributed to this report.
