Lies about Inflation, Prices, and Jobs . . .

Prof. Paul Krugman made mention of the Survey of Consumers findings. It gets kind of interesting. Trump tells stories and an expert calls him out. Two different articles. A portion from Prof. Krugman’s latest and the latest from the Surveys of Consumers where Prof. Krugman uses to point out Trump’s erroneous comments. In his latest:

“Lies, Damned Lies and Economic Vibes,” Paul Krugman,

He states:

“According to Donald Trump, the U.S. economy is doing great. We’re enjoying a huge boom, there’s no inflation, and we’re all getting tax cuts. We have prosperity like nobody has ever seen before.

But it’s probably not news to you that reality doesn’t agree with Trump’s delusion. Inflation was stubbornly elevated even before the Iran debacle, while growth has been sluggish. Jobs for entry-level workers are hard to find while mortgage and car loan rates are up. Gas-pump prices are above $4 on average and around 10 million Americans are projected to lose health insurance by 2028. Yet the one economic variable that stands out, that really is like nothing anyone has ever seen before, is consumer confidence: The long-running University of Michigan index of consumer sentiment just hit its lowest point ever recorded.”

The Survey data . . .

“Surveys of Consumers,” Director Joanne Hsu, University of Michigan

Consumer sentiment sank about 11% this month, extending a decline that began with the start of the Iran conflict, and is currently about 9% below a year ago. Demographic groups across age, income, and political party all posted setbacks in sentiment, as did every component of the index, reflecting the widespread nature of this month’s fall. One-year expected business conditions plunged about 20% and is now 6% below last April. Assessments of personal finances declined about 11%, with consumers expressing a substantial increase in concerns over high prices and weaker asset values. Buying conditions for durables and vehicles worsened, again on the basis of high prices. Open ended comments show that many consumers blame the Iran conflict for unfavorable changes to the economy. Note that 98% of interviews were completed prior to the April 7th announcement of a temporary cease-fire. Economic expectations will likely improve after consumers gain confidence that the supply disruptions stemming from the Iran conflict have ended and gas prices have moderated.

Year-ahead inflation expectations surged from 3.8% in March to 4.8% this month, the largest one-month increase since April 2025 (see chart, black dashed line and black circle). The current reading exceeds those seen in 2024 and remains well above the 2.3-3.0% range seen in the two years pre-pandemic. Long-run inflation expectations ticked up from 3.2% last month to 3.4% this month, the highest reading since November 2025. In 2024, values ranged between 2.8% and 3.2%, while in 2019 and 2020, they were consistently below 2.8%.

“Charts” – Surveys of Consumers

“Lies, Damned Lies and Economic Vibes,” Paul Krugman