Bloomberg Businessweek: "US Consumer Spending Powers On Even as Inflation Persists"

Date: September 26, 2025
Hosts: Carol Massar & Tim Stenovec
Key Guests:

• Michael McKee (Bloomberg TV and Radio International Economics and Policy Correspondent)
• Elizabeth Renter (Senior Economist, Nerd Wallet)
• Chris Strohm (Bloomberg News, Justice Department Reporter)
• Max Abelson (Bloomberg News Finance Reporter)
• Carol Schleife (Chief Market Strategist, BMO Private Wealth)

EPISODE OVERVIEW

This episode explores the persistent strength of US consumer spending despite elevated inflation, examines current Federal Reserve policy, recent economic data, and their implications for monetary policy. It moves on to analyze notable legal news, delving into the unusual indictment of former FBI director James Comey. The episode also unveils new revelations from thousands of Jeffrey Epstein’s private emails obtained by Bloomberg, offering fresh perspective on the breadth of his connections and influence. The conversation ends with a market wrap involving the latest on IPOs, stock performance, and business resilience amidst economic complexities.

KEY DISCUSSION POINTS & INSIGHTS

1. The US Economy: Consumer Spending, Inflation & Fed Policy

• Resilient Consumer Spending:
  Recent economic data reveals surprisingly strong consumer spending, despite persistently high inflation and falling sentiment.
  • "We got better than expected spending numbers for from consumers. So at this point, it's really hard to say what's going to happen." (Michael McKee, 03:51)
• Inflation Slowdown, But Still Above Target:
  The latest core inflation measure grew at a slower pace but remains closer to 3% than the Fed’s 2% target.
  • "Inflation is not going down. It didn't get any worse, but it is still closer to 3% than the Fed's 2% target." (Michael McKee, 04:10)
• Fed’s Stance: Data-Dependent, Not Prescriptive:
  Richmond Fed President Thomas Barkin emphasized an "adaptive and attentive" approach, resisting predictions about future rate cuts.
  • "I feel like very adaptive is the way to think about it... I'm not being prescriptive... I think we're going to see and learn a lot as we go here." (Thomas Barkin, 02:57)

Notable Quote

"Adaptive and attentive sounds like data dependent."
— Carol Massar (03:18)

2. Labor Market & Economic Outlook

• Strong But Evolving Labor Market:
  Despite a low hiring environment, unemployment claims fell, signaling resilience.
  • "If there's some good news out of this week in addition to the consumer spending is that the initial claims came down, the unemployment claims. So that's a bright spot." (Elizabeth Renter, 07:34)
• Upcoming Jobs Data & Possible Government Shutdown:
  There’s anticipation and uncertainty regarding the next nonfarm payrolls report due to potential government shutdown.
  • "The big question next week is not only what we're going to see in the jobs data, but if we're going to see the jobs data." (Elizabeth Renter, 08:41)
• Labor Participation Issues:
  A shrinking labor force, in part due to reduced immigration, is helping hold the unemployment rate steady despite weaker job growth.
  • "...the break even rate or the number of jobs we have to add each month... is decreasing. That's because the labor force is decreasing." (Elizabeth Renter, 09:12)

Notable Quote

"...The economy continues to grow according to the GDP figures."
— Elizabeth Renter (07:34)

3. Consumer Sentiment & Real World Inflation

• Disconnect Between Sentiment and Behavior:
  Consumers are spending robustly, but sentiment is weak due to ongoing price pressures, especially on essentials like food and gas.
  • "Consumers are feeling a bit of a burn more than that headline number would have you believe." (Elizabeth Renter, 06:49)
  • "The consumer sentiment numbers went down because of inflation... when you go to the grocery store, it's all just inflation legislation to you." (Michael McKee, 05:47)
• Tariffs, Gas, and Grocery Prices:
  Even when inflationary pressures arise from different sources (tariffs, gas, meat, turkey), it’s all felt similarly by average Americans.

Memorable Exchange

"My people are my husband and my daughter. But man, they brought some steaks and I was like, how much did they cost? When they told me, I was like, whoa."
— Carol Massar (06:14)

4. Legal Spotlight: James Comey Indictment

• Unusual Charges & Political Context:
  Former FBI Director James Comey has been charged with lying to Congress and obstruction, relating to 2020 testimony about leaks involving Andrew McCabe.
  • "The charges are highly unusual. There's two charges against Comey... related to testimony he gave in September of 2020." (Chris Strohm, 14:14)
• Inspector General’s Prior Findings:
  The Justice Department Inspector General found Comey was truthful and that McCabe was not, although Justice is now asserting otherwise.
  • "To our knowledge, there's no new information that would prove Comey was lying." (Chris Strohm, 16:26)
• Debate Over Presidential Power and DOJ Independence:
  The broader implications center on the precedent of presidential influence over Justice Department prosecutions.
  • "Historically, the Justice Department has maintained independence from the White House... but that's largely based on norms and traditional practices." (Chris Strohm, 17:38)

Notable Quote

"There’s no law or regulation that says the president can’t interfere in prosecutions."
— Chris Strohm (17:50)

5. Investigative Feature: Epstein's Newly Revealed Emails

• Scope and Nature of the Emails:
  Bloomberg reviewed 18,000+ previously unseen, private emails from Epstein’s Yahoo account, offering unparalleled insight into his dealings.
  • "These are private emails... This is new stuff and it’s from a private email address." (Max Abelson, 22:12)
• Insights Into Influence:
  The correspondence reveals the breadth and depth of Epstein’s relationships—not just with public figures, but academics, strategists, lawyers, and power brokers across the political spectrum.
  • "It's a story about money and a story about power and a story about connections." (Max Abelson, 23:19)
• Example – Seeking Crisis PR:
  In 2008, just before going to jail, Epstein sought out crisis communications help, illustrated by drafted apology letters from consultant Mary Spaythe.
  • "What do we find in these emails, but these draft apology options... one’s very meek... The third one... He cites William James." (Max Abelson, 25:04)
• Humanizing the Apology (or Not):
  Epstein never actually issued a public apology, even as his PR advisors considered it.
  • "For all we know, Epstein was really very close to saying sorry, but he did not. He did not in the sense of giving a broad apology, certainly to his victims." (Max Abelson, 27:18)

Notable Quotes

"What this story is about is in some ways... not the usual, you know, Epstein is of course in some ways a story about sex and sex crimes. But... it's really a story about money and a story about power and a story about connections."
— Max Abelson (23:19)

"There are a lot of questions about what's gonna happen now over the next few days and weeks and months with Epstein and his files."
— Max Abelson (24:35)

6. Markets & Investing: Valuations, IPOs, and Business Resilience

• Market Overview:
  US equities ended a streak of gains with a down week for the S&P 500, while Electronic Arts stock surged on takeover speculation.
  • "We are expecting a down week on the S&P 500 this after three consecutive weeks of gains." (Carol Massar, 30:25)
  • "Electronic Art said to be near a takeover by Silver Lake... could announce a Deal as soon as next week." (Tim Stenovec, 31:15)
• Valuations & Fundamentals:
  Stock valuations are high, but underlying earnings and GDP estimates have come down, and high valuations alone don’t end bull runs.
  • "Valuations are not what kills a bull market, nor do they revive a bear market. Things can stay over or undervalued for a great length of time." (Carol Schleife, 32:54)
• Resilience Amid Uncertainty:
  Despite concerns over tariffs, policy shifts, and geopolitical developments, both businesses and markets are demonstrating adaptability.
  • "We've urged investors to cling... to follow the fundamentals and to look at companies and to listen to what companies are doing and watch what they're doing." (Carol Schleife, 34:28)
• IPO Market & Public Company Trends:
  The locked IPO market may be easing, with thousands of mature firms potentially preparing to go public; the US now has more ETFs than publicly traded companies.
  • "Having some IPOs because we peaked in terms of public companies back in 1996... Currently there are more ETFs than there are publicly held companies in the U.S." (Carol Schleife, 38:09)

Notable Quotes

"The one theme that's been very consistent is the resiliency of businesses, the economy, and consumers."
— Carol Schleife (33:31)

IMPORTANT SEGMENTS & TIMESTAMPS

| Time | Topic/Segment | |-----------|-----------------------------------------------------------| | 00:54 | Opening: Inflation gauge & consumer sentiment | | 02:35 | Thomas Barkin (Richmond Fed) on policy flexibility | | 03:51 | Michael McKee: Recent economic data & Fed expectations | | 06:33 | Elizabeth Renter: Inflation’s real world impact | | 08:41 | Labor market & jobs outlook / data uncertainty (Renter) | | 14:14 | Chris Strohm on James Comey indictment | | 22:07 | Max Abelson: Epstein email revelations | | 30:25 | Market wrap: S&P 500, EA takeover speculation | | 32:54 | Carol Schleife on valuations & business resilience |

QUOTES HIGHLIGHT

• "Adaptive and attentive sounds like data dependent." — Carol Massar (03:18)
• "It just kind of beats those who are in the middle. For the Fed, they're probably going to be waiting till much closer to October 29th to make any kind of decision." — Michael McKee (04:28)
• "We all remember being kids and having to apologize." — Max Abelson (25:05)
• "There’s no law or regulation that says the president can’t interfere in prosecutions." — Chris Strohm (17:50)
• "Things can stay over or undervalued for a great length of time... The resiliency of businesses, the economy, and consumers." — Carol Schleife (33:31)

EPISODE TAKEAWAYS

• US consumers keep spending robustly, even as economic sentiment drops and inflation stays elevated.
• The Federal Reserve remains cautious and highly data-dependent, unwilling to commit to any specific path on rates.
• Labor market data is stable, but further releases could be delayed by a potential government shutdown; a shrinking labor force is a notable trend.
• James Comey’s indictment is legally and politically unprecedented, raising broader questions about the independence of the Justice Department.
• Bloomberg’s exclusive look into Epstein’s private emails reveals the full scale and diversity of his power network, underscoring America’s persistent elite entanglements.
• Stock valuations are high, but business fundamentals and adaptability are keeping markets afloat; the IPO drought may be breaking, with potential for more listings.

For a deeper dive into these stories, listen to the full episode or check out the related features on Bloomberg.