Getting spendy to get ahead of tariffs

Summary

Marketplace Morning Report – "Getting spendy to get ahead of tariffs"

Date: August 18, 2025
Host: Nancy Marshall Genzer (in for David Brancaccio)

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Episode Overview

This short episode unpacks recent trends in consumer spending and the broader effects of tariffs and government policies on the US economy. With a focus on retail sales, the housing market, and venture capital—especially for women-led startups—the show offers concise, on-the-ground perspectives. The tone is lightly inquisitive, weaving together statistical highlights and real-world interviews.

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Key Discussion Points & Insights

1. Surging Consumer Spending: Big-Ticket Buys Despite Uncertainty

Segment: [00:47–02:37]

• Retail sales have seen a notable uptick, particularly for higher-priced durable goods.

  • Car dealer sales: Up 4.7% in July vs. prior year.
  • Furniture sales: Up 5.1% year-over-year.

• Marketplace’s Matt Levin visits Brenner's Furniture in Eugene, Oregon:

  • Sales are up 20% month-over-month; more store traffic than last year.

  • Lance Miles (GM, Brenner’s Furniture):

    “Yeah, I have no clue, man. It doesn't make any sense to me.” [01:42]

  • While sales soar, customers are gravitating towards less expensive options (e.g., $500 sofas).

    “I think we're seeing more people coming in getting the less expensive stuff.” – Lance Miles [01:59]

• Possible Explanation for the Surge:

  • Max Kahn (Coresight Research):
    • Wealthy consumers are buying now to get ahead of anticipated tariff-fueled price hikes.

    "People are making the purchases now while they perceive that prices are staying kind of where they've been." [02:18]

    • The spree likely won’t last; durable goods like sofas aren’t frequent purchases:

    "You typically don't buy sofas multiple times a year." – Max Kahn [02:29]

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2. Housing Market: Homebuilders Remain Pessimistic

Segment: [02:37–03:53]

• Builder sentiment remains low, with the NAHB Confidence Index lagging.

• Contributing Factors:

  • High mortgage rates.
  • Tariffs creating market uncertainty.

• Recent developments:

  • Builders have cut prices to incentivize sales.
  • Single-family home construction: Down during the summer.
  • Multifamily projects: Slight growth.

• Outlook:

  • Mortgage rates have fallen to their lowest since October last year but remain elevated compared to pre-pandemic levels.
  • Housing market is "frozen" as current owners hesitate to sell and lose their low rates.

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3. Venture Capital & Startups: Headwinds for Investment

Segment: [04:54–08:20]

• Headline: U.S. startup funding up 75% in H1 2025—but overall capital raised by venture firms is down.

• Key headwinds:

  • Tariffs.
  • Canceled government grants/contracts (especially post-policy changes under the Trump administration).

• Guest Interview:

  • Joanne Corcoran (Co-CEO, Golden Seeds) discusses the impact on women-led startups.

    “About 50% of the things that we do, the companies in which we invest, are either bio and life sciences related or deep tech related... They have really had to stop and reevaluate.” [05:44]

• Effect of Tariffs and Policy Cuts:

  • Startups that typically would scale production offshore to cut costs no longer have that option, due to tariffs.

    “Let's say you're a company who has developed a product in the US at a prototyping facility... In many cases you would go offshore. You can't.” [06:34]

  • Result: Heightened uncertainty reduces startup valuations.

    “There's also this whole uncertainty out there. And for us as investors, when things are uncertain, that means we're going to pay a lower price for them.” – Joanne Corcoran [07:05]

  • Not just women-led companies facing harder terms—affects all new businesses.

• Memorable Example:

  • A Golden Seeds investment in microplastics-removal technology for water treatment faces a headwind as related regulatory action is delayed:

    “With the current state of science in our government, I would say that the chances of having that kind of legislation are pushed out. So that tailwind has declined a little bit.” – Joanne Corcoran [07:58]

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Notable Quotes & Memorable Moments

• “Yeah, I have no clue, man. It doesn't make any sense to me.”
  – Lance Miles, GM of Brenner's Furniture, on why sales are up during economic uncertainty [01:42]

• “People are making the purchases now while they perceive that prices are staying kind of where they've been.”
  – Max Kahn, Coresight Research [02:18]

• “When things are uncertain, that means we're going to pay a lower price for them.”
  – Joanne Corcoran, Golden Seeds [07:05]

• “With the current state of science in our government, I would say that the chances of having that kind of legislation are pushed out. So that tailwind has declined a little bit.”
  – Joanne Corcoran, on regulatory delays impacting startup prospects [07:58]

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Timestamps for Important Segments

• 00:47 – Consumer spending data, retail sales jump
• 01:23–02:37 – On the ground at Brenner’s Furniture: consumer behavior, impact of tariffs
• 02:37–03:53 – Housing market update: builder outlook and mortgage rates
• 04:54–08:20 – Venture capital, impact of tariffs and government policy on startups (interview with Joanne Corcoran)

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Summary

This episode of Marketplace Morning Report explores why Americans are spending big on cars and furniture despite economic clouds, identifies the influence of tariffs on consumer behavior, and spotlights headwinds facing startups—especially when policy decisions are in flux. Both consumer and investor behavior reveal how uncertainty and the specter of higher costs spur present-day decisions, but also cool long-term confidence, from the furniture showroom to the venture capital boardroom.

Transcript

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[Nancy Marshall Genser]

Consumers are buying new furniture, but not new Houses From Marketplace, I'm Nancy Marshall Genser in for David Brancaccio, digging a little deeper into those relatively encouraging retail sales numbers we got from the Census Bureau on Friday. Consumer spending was up pretty significantly for more expensive items. Sales at car dealers were up 4.7% in July from the year before. Furniture sales were up 5.1%. All that big ticket buying comes despite a softening labor market and broader economic uncertainty. Here's Marketplace's Matt Levin.

[Matt Levin]

Sales are up 20% or so month over month at Brenner's Furniture and Mattress in Eugene, Oregon. Revenue and foot traffic are up from last year, too. If you're wondering why consumers are buying big ticket items like recliners and sofas in the midst of a slowing job market, general manager Lance Miles has the same question.

[AT&T Business Announcer]

Yeah, I have no clue, man. It doesn't make any sense to me.

[Matt Levin]

Miles says he does see one sign of uncertainty, maybe ever so slightly slipping into customer mindsets. Sofas in the $500 range are a little more popular than the thousand dollar models these days.

[AT&T Business Announcer]

I think we're seeing more people coming in getting the less expensive stuff.

[Matt Levin]

Furniture is one of those products where tariffs are starting to push prices up. Max Kahn at the retail consulting firm coresight Research says wealthy consumers especially have tried to get ahead of tariffs by buying pricey stuff now as opposed to the end of the year. People are making the purchases now while they perceive that prices are staying kind of where they've been. But Kahn doesn't expect the spending spree to last. A lot of big ticket items are durable goods. You typically don't buy sofas multiple times a year. I'm Matt Levin for Marketplace.

[Nancy Marshall Genser]

Later this morning we'll get the latest measure of how home builders are feeling about their industry. The national association of Home Builders Confidence Index has been lagging all year, with builders seeing slow demand for new houses, Marketplace's Henry Epp reports.

[Henry Epp]

High mortgage rates and uncertainty around tariffs have kept many potential home buyers on the sidelines this year, leading home builders to feel more pessimistic about the market. Builders have cut prices for new homes and the level of new single family home construction fell this summer, though new multifamily projects picked up. What could give builders some optimism this month is falling mortgage rates. They're down to their lowest level since last October, though still much higher than a few years ago. That's kept a lot of the housing market frozen in place as many current owners feel reluctant to re enter the market and give up their low rates. I'm Henry Epp for Marketplace.

[AT&T Business Announcer]

And now a next level moment from ATT Business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep Day. You've got at and T5G so you're fully confident, but the vendor isn't responding and International Sleep Day is tomorrow. Luckily, AT&T5G lets you deal with any issues with ease, so the pillows will get delivered and everyone can sleep soundly, especially you. AT&T5G requires a compatible plan and device coverage not available everywhere. Learn [e-mail] 5G Network.

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[Nancy Marshall Genser]

Funding for startups in the US went up 75% in the first half of this year, but when you zoom out, there's actually a decline in the amount of money that venture capital groups raised. There are several headwinds when it comes to this kind of investment, including tariffs and the cancellation of government grants and contracts under the Trump administration. Let's check in with Golden Seeds, which does both venture capital and angel investment specifically for businesses founded by women. Joanne Corcoran is co CEO and managing partner there. Good morning, Good morning. I've reported on the impact of government cuts on federal workers, but private companies rely on government contracts and grants too of course. Can you tell us about the effect that these cuts and cancellations are having on startups, especially startups led by women?

[Joanne Corcoran]

About 50% of the things that we do, the companies in which we invest are either bio and life sciences related or deep tech related, things that depend on scientific and technological advancements to start a business. All of these companies, I would say, have considered, as they look at their business plans over the next couple of years, have considered some possibility that they would get more grants to advance whatever the tech is. And they have really had to stop and reevaluate.

[Nancy Marshall Genser]

Of course, along with the cuts in government contracts, tariffs are in the mix. Now, how has that affected angel investments and how you evaluate an investment?

[Joanne Corcoran]

Let's say you're a company who has developed a product in the US at a prototyping facility, right? And now you have a product and you have customers who want to buy it and you want to scale it and lower the price. So what are you going to do? In many cases you would go offshore. You can't. So we're seeing that with a lot of companies. There's also this whole uncertainty out there. And for us as investors, when things are uncertain, that means we're going to pay a lower price for them.

[Nancy Marshall Genser]

Oh, so the female entrepreneurs are getting not such a great deal during uncertain times.

[Joanne Corcoran]

I would say it's not just female entrepreneurs. I would say it's all entrepreneurs. You know, if tailwinds or headwinds are uncertain for me as an investor, I need more reason to invest. We invested in a company that very interesting, fun technology. They created a polymer that it's a magnet for plastic. Stick it in a water treatment facility and it attracts microplastics. It's very interesting tech. The tailwind for that is that there's a real concern about microplastics in water and people want to have this mitigated. Well, lo and behold, with the current state of science in our government, I would say that the chances of having that kind of legislation are pushed out. So that tailwind has declined a little bit.

[Nancy Marshall Genser]

I've been speaking with Joanne Corcoran. She's the co CEO and managing partner of Goldenseeds. Joanne, great to speak with you.

[Joanne Corcoran]

Thank you, Nancy.

[Nancy Marshall Genser]

In Washington, I'm Nancy Marshall Genzer with the Marketplace Morning report from APM American Public Media.

[AT&T Business Announcer]

And now a next level moment from AT&T business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding and International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease, so the pillows will get delivered and everyone can sleep soundly. Special you at and T5G requires a compatible plan and device coverage not available everywhere. Learn [e-mail] 5G Network.