Does the central bank have enough data to go off of?

Summary

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Marketplace Morning Report

Episode: Does the central bank have enough data to go off of?

Date: October 28, 2025

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Episode Overview

This brisk episode centers on the Federal Reserve's current struggle to make policy decisions while crucial government data is inaccessible due to a federal budget impasse. The show examines how the Fed is adapting, relying more heavily on regional surveys, anecdotal evidence, and incomplete data sets. Additional coverage includes President Trump’s diplomatic trip to Japan, rising health insurance premiums as open enrollment begins, and the latest figures on the US cities with the highest housing cost burdens.

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Key Discussion Points & Insights

1. Federal Reserve: Operating Without Key Data

Timestamps: 01:31 - 04:14

• Main Challenge:
  The ongoing government shutdown has limited the Federal Reserve’s access to critical federal economic data (like import/export numbers, retail sales), forcing reliance on regional Fed surveys and private sector data.

• Regional Specialties:

  • Dallas Fed ("the Energy Fed") is especially knowledgeable about oil, energy markets, and immigration effects.
    • Danielle DiMartino Booth: "Dallas is called the Energy Fed because we have such a good handle on what is happening in the oil patch as well as what's happening with immigration flows and how that affects the US Economy." (02:21)
  • Other Fed banks track sectors from pharmaceuticals to food manufacturing, asking about hiring, firing, pricing, and backlogs.

• Alternative Data Sources:

  • Regional surveys give a partial view of the national picture (hiring/firing decisions, order backlogs, local spending).
  • Anecdotes compiled in the “Beige Book" include everything from Atlanta diners skipping dessert to higher credit card delinquencies in St. Louis.
  • Some “hard data” products (like the Atlanta Fed's GDPNow) are compromised, as they depend on federal stats that aren't being updated.

• Risks of Limited Data:

  • David Wilcox (Peterson Institute for International Economics):
    “The Fed is on a pretty slim data diet. And as time goes by, the basis for policy decision making will become more shaky as Fed officials have to rely more and more on imperfect economic indicators like surveys and anecdotes.” (03:55)
  • The longer the shutdown, the more policy rests on uncertain footing.

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2. President Trump’s Visit to Japan

Timestamps: 04:14 - 05:23

• Diplomatic Focus:
  President Trump met Japanese PM Sanae Takechi, praising her leadership. Key agreements were signed concerning:
  • Joint production/supply of critical rare earth minerals (effort to reduce US reliance on China)
  • US pressure for Japan to buy more American agricultural products and open its car market
  • Human rights: Trump met families of Japanese citizens abducted by North Korea, promising US help.
• Quote:
  BBC’s Shama Khalil: “For now, the tone is friendly, but there’s a real pressure on Tokyo to deliver.” (05:19)

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3. Health Insurance Premiums on the Rise: Open Enrollment

Timestamps: 06:21 - 08:10

• Context:
  Amid the government shutdown, ACA plan users face possible skyrocketing premiums, but most Americans get their insurance at work, where costs are also increasing.
• Facts & Figures:
  • KFF report: workplace plan premiums are up 6% this year; higher increases expected for 2026.
  • Matthew Rae (KFF): “When premiums go up, both employers and employees share the cost. At this point, workers chip in about 26% of the cost for family coverage on average.” (07:02)
• Cost Drivers:
  • Increased use of expensive GLP-1 weight-loss drugs and new gene therapies.
    • Ali Lockman (Texas A&M School of Public Health): “Those all cost money that gets passed along to insurers and then passed along to employers and their employees through premiums and co pays.” (07:24)
• Employer Response:
  Options include trimming benefits or shifting more costs to employees.
  • Miranda Yaver (University of Pittsburgh): "There can be adjustments to sort of the scope of benefits... adjustments to what employees themselves can be expected to cover." (07:44)
  • Consequence: Employees may be nudged into high-deductible, lower-premium plans.
• Summary Quote:
  Kimberly Adams: “[Employers may] push workers into cheaper monthly plans with higher deductibles as they try to keep their health care costs down.” (07:53)

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4. Housing Affordability: Where Americans Are Most "House Poor"

Timestamps: 08:10 - 08:58

• Headline:
  Housing costs eat up the highest share of income in Hialeah, Florida, where shelter consumes 37% of a typical household’s income.
• Other Expensive Markets:
  Following Hialeah: New York, New Orleans, and Los Angeles (~33% of income to housing).
• Notable Stat:
  In Hialeah: median income $6,000/month; median rent or mortgage $2,200/month.

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Notable Quotes & Memorable Moments

• On the Fed’s data crunch:
  "The Fed is on a pretty slim data diet... by relying more and more on imperfect economic indicators like surveys and anecdotes."
  — David Wilcox (03:55)

• On rising insurance premiums:
  “When premiums go up, both employers and employees share the cost. At this point, workers chip in about 26% of the cost for family coverage on average.”
  — Matthew Rae (07:02)

• Diplomacy in Japan:
  “For now, the tone is friendly, but there’s a real pressure on Tokyo to deliver.”
  — Shama Khalil, BBC (05:19)

• On housing costs:
  "That means shelter in Hialeah is 37% of everything."
  — David Brancaccio (08:37)

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Useful Timestamps

• Fed's data dilemma begins: 01:31
• Regional Fed perspectives: 02:05 – 03:30
• Risks of limited data: 03:50 – 04:14
• Japan trip and minerals/trade: 04:14 – 05:23
• Rising health premiums: 06:21 – 08:10
• Housing costs segment: 08:10 – 08:58

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Tone & Style

Concise, informed, and slightly urgent, reflecting the stakes of government gridlock and real-world economic impacts. The episode balances fast factual delivery with expert voices and touches of human interest.

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In Summary

The episode delivers a sharp overview of how the Federal Reserve and American workers must adapt to sudden data blindspots and accelerating costs, all against a backdrop of shifting international alliances and the persistent challenge of American housing affordability. Key voices offer both technical clarity and practical context, delivering essential economic insights in a compact package.

Transcript

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[C]

Open enrollment at work could mean some sticker shock I'm David Brancaccio in Los Angeles. First, our central bankers gather in Washington this morning to play the three dimensional chess of whether jobs, inflation or growth can let them drop interest rates. Further, some of the Fed's normal views into the economy will be at hand today, an index of home prices from 20 cities and a reading on consumer confidence. That's data from private companies, but because of the budget impasse, the government Federal Reserve depends on is missing. Our Nancy Marshall Genser covers Washington.

[D]

Some of the data from the regional Federal Reserve banks comes from actually talking to people and the regions all have their specialties. Danielle DiMartino Booth is founder and CEO of QI Research. Before that she was an advisor at the Dallas Fed.

[E]

Dallas is called the Energy Fed because we have such a good handle on what is happening in the oil patch as well as what's happening with immigration flows and how that affects the US Economy.

[D]

Other Fed bank surveys cover pharmaceutical, food, and chemical manufacturing. They ask, are you hiring or firing people, raising prices? Do you have a backlog? Kathy Busjancik, chief economist at Nationwide, says you can stitch the answers together to get a broad idea of how the economy's doing, what's happening in employment, new orders, shipment and inflation. So it kind of offers a nice swath of data. Then there's the beige Book, a mashup of lots of anecdotes from the regional Fed banks. Tidbits like diners in Atlanta refusing to splurge on desserts and drinks and higher credit card delinquency rates in St. Louis. David Wilcox is a former Fed economist now with the Peterson Institute for International Economics. He says some Fed banks also have hard data. The Atlanta Fed's GDP now index, for example. It tracks the components of gross domestic product, things like monthly imports, monthly readings on retail sales. But guess where those come from? Yep, federal agencies that are closed right now. In fact, the Atlanta Fed says its data tools that rely on those statistics might be incomplete or delayed during the shutdown. There's a similar warning from the Chicago Fed, which isn't able to produce its index of economic activity. Wilcox says the Fed is on a pretty slim data diet. And as time goes by, the basis for policy decision making will become more shaky as Fed officials have to rely more and more on imperfect economic indicators like surveys and anecdotes. I'm Nancy Marshall Genser for Marketplace.

[C]

President Trump was in Tokyo today praising the new conservative prime minister of Japan, Sanae Takechi. They signed deals on trade critical minerals and Trump was enthusiastic about Takechi's plans to to build up Japan's military. The BBC's Shama Khalil reports the two.

[F]

Countries agreed to cooperate on the production and supply of critical rare earths minerals as Washington tries to reduce its reliance on China. President Trump also met the families of Japanese citizens abducted by North Korea in the 70s and 80s, saying that the US will do everything in its power to help return them. This is a critical day for Japan and its new prime minister, Sanae Takaichi. During his meeting with her, Mr. Trump said Japan was a great ally, but he's also demanding concessions. He wants Japan to buy more American rice and soybeans and to open its market to US Vehicles. For now, the tone is friendly, but there's a real pressure on Tokyo to deliver.

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[C]

A central dispute in the impasse over the federal budget shutting down the government is health care, with costs of premiums set to skyrocket without new funding for people using Affordable Care act medical plans. But for the majority of workers who get health plans through their employers, there may also be jumps in prices this season as we enter the annual open enrollment period, MarketPL senior Washington correspondent Kimberly Adams reports.

[E]

According to a recent report from the health Policy Research Organization KFF, premiums for workplace insurance plans were up 6% this year, and employers are bracing for even higher costs in 2026, says KFF's Matthew Ray.

[B]

So when premiums go up, both employers and employees share the cost. At this point, workers chip in about 26% of the cost for family coverage on average.

[E]

Ray says Several factors are driving the increase, including increased adoption of pricey GLP1 weight loss drugs and advanced gene therapies. Ali Lockman teaches at the Texas A and M School of Public Health.

[B]

And those all cost money that gets passed along to insurers and then passed along to employers and their employees through premiums and co pays.

[E]

Employers who can't or don't want to eat those higher costs have a few options, says Miranda Yavar, who teaches health policy and management at the University of Pittsburgh.

[D]

There can be adjustments to sort of the scope of benefits. There can also be adjustments to what.

[E]

Employees themselves can be expected to cover, Yavar says. That may push workers into cheaper monthly plans with higher deductibles as they try to keep their health care costs down. In Washington, I'm Kimberly Adams for Marketplace.

[C]

And the cities where the biggest chunk of pay is eaten up by the cost of a place to live. Numbers 2, 3 and 4 most expensive are New York, New Orleans and Los Angeles, where about a third of typical income goes to housing. The city that'll make you the most house poor in America is Hialeah, Florida, near the Miami airport. Typical monthly household income, six grand. Typical house or apartment, $2,200 a month. That means shelter in Hialeah is 37% of everything. Our producers are Tamar Fagan, Ashley Rodriguez, Ariana Rosas and Erica Soderstrom. Our senior producer is Alex Schroeder. Our supervising senior producer is Meredith Garrettson. Morby In Los Angeles, I'm David Brancaccio. Marketplace Morning Report from APM American Public Media.

[E]

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[D]

Applause.