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President Biden boasts economic progress, Elon Musk meets with House leadership

Yahoo Finance political columnist Rick Newman joins Yahoo Finance Live to talk about the week's political developments, including President Biden's touting of the latest economic data.

Video transcript

DAVE BRIGGS: President Biden feeling the wind at his back with news of a 2.9% GDP growth. Touting this and recent jobs numbers as evidence that the Biden economic plan is working.

Senior columnist Rick Newman taking on that claim in this week's Bidenomics. Rick, good to see you, sir. Are people buying it?

RICK NEWMAN: Yeah, they are a little bit. We saw an increase or an improvement in consumer confidence this week. I don't think that's because Biden is telling people they can afford to be more confident, and I think it's reaction to falling inflation.

But, you know, things are looking pretty good. I mean, just go back a year, what we know about how the year began in 2022. We had two quarters in a row where GDP actually contracted a little bit. Some people thought that meant a recession had arrived, but that's not what happened in 2022. Growth for the year came in at 2.2%.

Biden gave a speech this week on the economy, and he said, look, practically since I came into office, Wall Street analysts have been saying, oh, a recession has been coming-- a recession is coming. A recession is coming. We've talked about this a million times, and it hasn't. So a recession is not here.

Now, what happens with this narrative in 2023? I think Biden's got a kind of window of opportunity here for about three months, but there are a lot of signs that economic data is going to weaken in the first and second quarter of 2023. It's different from a year ago, obviously, because interest rates are higher. That is going to slow the economy. We're getting some forecasts for the first quarter of '23, the one we're in right now, that are around -1.5%, so a shrinking economy.

But look, we're not going to get that news until late April. And for now, Biden can go around saying things are pretty good, and that's exactly what he's doing.

JARED BLIKRE: And Rick, shifting gears just slightly, Elon Musk-- can't spend five minutes without talking about him-- met with White House leaders on Capitol Hill only earlier today. I'm also seeing names floated like John Podesta, senior advisor to Joe Biden; Mitch Landrieu, senior advisor and coordinator on infrastructure. What was he talking about with them possibly, and what do we know about this?

RICK NEWMAN: Nobody's saying, but there are two apparent things going on here. So today, Elon Musk met with White House officials, probably to talk about electric vehicles and, in particular, the rollout of a lot of the incentives for green energy, EVs, and other types of things-- a charging network across the country-- that were in the Inflation Reduction Act that passed over the summer.

I think this is important because there was a spat between Elon Musk and President Biden for a while there because every time Biden talked about electric vehicles and EV automakers, mainly he talked about General Motors and Ford, and he almost never mentioned Tesla, which really put Elon Musk in a foul mood toward Biden. He called him-- he called Biden a damp sock puppet on Twitter about a year ago, one of the more interesting Elon Musk tweets, and there have been many.

And he was really just irked that Biden would really not give Tesla any credit. And, you know, I think Elon Musk was kind of right about that. I mean, Tesla has-- still is the leading electric vehicle maker in the United States and, some could argue, in the world, and Biden would get up and talk about GM and Ford because they have unionized plants and Tesla does not have unionized plants.

So maybe Elon Musk meeting with the Biden administration is a little bit of a rapprochement there. And yesterday Elon Musk met with Kevin McCarthy, the Republican House speaker, and probably talked about Twitter and this whole issue of whether Twitter has been tweeting conservatives unfairly. I do not think Twitter has been treating conservatives unfairly. I think what Twitter did before Elon Musk bought it was they banned the people with the most outrageous comments, and many of those turned out to be conservative.

So we'll see what Elon Musk is doing there. You know there are many developments ongoing there. We've been talking about them all week. So I can go on and on about Elon Musk, but you guys probably have other things you want to talk about.

JARED BLIKRE: No, that's OK. I mean, we've got the entire weekend of FinTwit to look forward to. So thank you for that. Yahoo Finance's Rick Newman.

RICK NEWMAN: Bye, guys.