President Joe Biden’s economic pitch to voters should be getting easier. But political turmoil has yanked away the microphone just when he needs it most. After years of analysts declaring that “good news is actually bad news” — because faster GDP and job growth raised anxiety that inflation might linger — the president has been on a hot streak, where good news is actually good news. Annual inflation is getting ever-closer to the Federal Reserve’s 2 percent target — prices dropped from May to June, according to the Consumer Price Index. And Fed officials are sounding increasingly confident that they’ll be able to cut interest rates in September (while never actually putting a firm timeline on it). Indeed, Chris Waller — one of the Fed rate-setting committee’s more hawkish members — gave a speech Wednesday titled “Getting Closer.” “I believe current data are consistent with achieving a soft landing,” he said. “So, while I don’t believe we have reached our final destination, I do believe we are getting closer to the time when a cut in the policy rate is warranted.” That’s on top of signs that the job market is bending without breaking. Unemployment has gradually risen to 4.1 percent from a trough of 3.4 percent, but layoffs are still low. That it’s happened slowly is a key ingredient to the recipe for avoiding a downturn. And joblessness isn’t yet at concerning levels. “It’s ahistorical what we’re observing,” Chicago Fed President Austan Goolsbee told reporters last week. “You don’t see gradual increases in the unemployment rate [like this]. … It looks so different than a normal business cycle deterioration that it doesn’t feel like the beginning of a recession.” There are other economic trends that should make a presidential incumbent salivate, such as a sustained surge in new business creation. In January, the White House said business formation has risen more in the previous three years than at any point in the two decades that the Census Bureau has tracked it. Small Business Administrator Isabel Guzman touted that record in an interview with MM, noting that while the initial bump in business births was a result of the pandemic, the trend has continued. She attributed it to a whole host of factors: people taking part in the Great Resignation deciding to strike out on their own, a shift to suburban communities that changed where and what people wanted to buy, and healthy consumer spending generally. “Clearly, there has to be market opportunity. There has to be the capital available for small businesses,” she said. “And that’s really what the Biden-Harris administration has focused on doing, and especially for underserved communities.” “It is really critical that we get out and talk about these successes,” she added. But the split screen is that voters still strongly prefer Donald Trump to Biden on the economy. And now much of the oxygen is being taken up by questions about whether the president can even continue in the race, an attempted assassination of the former president, and the policies and politics of J.D. Vance, Trump’s chosen running mate. (Vance, after all, is the only new element to either of the two tickets.) Biden’s most recent press conference also put on display how much more comfortable he is talking about foreign policy than in selling his economic record. Meanwhile, one Trump ally is giving the challenger — not Biden — credit for the stock market’s recent gains. Larry Kudlow encapsulated the broader politics of the situation perfectly: “Suddenly, stock markets are mounting a huge spiking rally, and I have to believe it has something to do with Donald Trump’s providential escape from an assassin’s bullet,” he said Tuesday on the sidelines of the Republican National Convention. “Today alone, the Dow is up over 700 points, yesterday over 200 points. I don’t think this is a coincidence.” IT’S THURSDAY — The past month has been absolutely bonkers on the news front. Send tips and suggestions to ssutton@politico.com and @samjsutton.
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