During an interview on "Varney & Co.," Thursday, FOX Business host Larry Kudlow provided analysis of the better-than-expected third quarter GDP report as American consumers continue to limp through an aggressive monetary policy from the Federal Reserve to tame record inflation.
LARRY KUDLOW: I think it's kind of a strange number. I think it's a head fake number. I think it's much stronger than it really is on the underlying economy. You had a big booster shot from trade. Net exports contributed, 14% increase. So I would take this with a grain of salt. Look, if you look at the trend, the first two quarters were negative. This quarter was up 2.6, year flat GDP for the first three quarters of the year. Year flat. Mr. Biden inherited a six-and-a-half percent growth economy two years ago. It's gone to flat. You had an inflation number that looked very light to me, 4% something. I think underlying inflation, the Cleveland Fed, median CPI, for example, 7%, wages running about almost 7%. So I think he got a lot of problems here in the economy.
And I think the Fed is going to have to keep on tightening. I appreciate what Jeremy Siegel said. He's a brilliant guy, I'm a long-time follower of his. I do know the money supply has slowed down, but that's not the only inflation factor here. And I think it's going to be rough sledding. And my last point is, look, Maria, even with these numbers, the inflation rate was twice the growth rate. So that is a stagflation definition. And I think we're caught up in that kind of stagflation. Unless we get more supply-side policies, open the spigots for fossil fuels. Stop the spending. Stop the tax hikes. Stop the regulation. We need some supply-side boosters for this economy. Right now, I don't see them. But then again, Maria, the cavalry is coming in a few days, so that's a plus.