Marketplace Morning Report Summary Episode: Is there a cost if economists face pressure to back up Trump?
Release Date: August 13, 2025

Economic Pressures on Economists Under the Trump Administration

Opening Discussion: David Brancaccio opens the episode by addressing recent actions by President Trump that may signal increasing pressure on economists to align with the administration's economic narratives. He references two significant events:

1. Firing of the Bureau of Labor Statistics Head: Following job market revisions that portrayed a weaker economy.
2. Pressure on Goldman Sachs’ Chief Economist: After predictions that tariffs would lead to higher consumer prices.

Quote Highlight:

"Is there a cost if economists face pressure to back up President Trump?"
— David Brancaccio [00:31]

Impact on Financial Markets and Investor Confidence

Susan Schmidt’s Insights: Susan Schmidt, Portfolio Manager at Exchange Capital Resources, discusses the unprecedented nature of the administration’s actions to suppress dissenting economic opinions within major financial institutions. She emphasizes that such moves are atypical and potentially harmful to market confidence.

Key Points:

• Unprecedented Pressure: Schmidt notes that in her career, she has never seen an administration single out an economist to suppress contrary views.

  "It's highly unusual. I don't think that I've ever seen this before in my career..."
  — Susan Schmidt [01:13]

• Investor Confidence Erosion: Attempting to alter data calculations or stifle opposing views disrupts investors’ information processing, leading to increased risk aversion and skepticism toward the markets.

  "Stifling any views or perhaps changing the way data is calculated makes it really hard for investors..."
  — Susan Schmidt [01:44]

• Comparison to Chinese Data Practices: Schmidt draws parallels to criticisms of the Chinese market, where data manipulation is alleged, suggesting that similar practices in the U.S. could undermine market integrity.

  "The Chinese government pulls general data that doesn't agree with the overall government's opinion...."
  — Susan Schmidt [02:36]

Broader Economic Implications

Brancaccio probes whether these efforts to control economic narratives might have broader implications. Schmidt responds by highlighting the potential for reduced market confidence, increased investor skepticism, and the leveling out of markets away from all-time highs.

Quote Highlight:

"That tends to make investors risk averse and so it levels out markets, causing investors to look at them with more skepticism..."
— Susan Schmidt [01:44]

Corporate Struggles Amid Economic Uncertainty

The discussion transitions to corporate financial health, spotlighting Spirit Airlines' precarious situation five months post-bankruptcy protection. The airline's stock plummeted by 40% following its quarterly report but has shown some recovery.

Quote Highlight:

"Spirit Airlines indicated it could go out of business completely if it doesn't bring in more money."
— David Brancaccio [02:43]

Global Arms Production and France’s Military Expansion

BBC Report by John Laurenson: The episode shifts to an international perspective with John Laurenson reporting on France's ramped-up arms production in response to the Russian invasion of Ukraine. France aims to double its military spending to 3.5% of its GDP by the following year.

Key Developments:

• Factory Conversions: Civilian factories are being repurposed for military manufacturing. For instance, a Normandy factory switched from producing SIM cards to manufacturing printed circuit boards for Rafale fighter planes.

  "Historically, this site has been producing SIM cards, telecoms, SIM cards.... now making a conversion towards this new."
  — Thierry Charlot, Site Manager [04:33]

• Employment and Investment: Thales has invested approximately €750 million in defense-related capital expenditures over three years, hiring 9,000 people to bolster France’s defense capabilities.

  "We have invested around 750 million euros of Capex capital investments for our factories for defence in France..."
  — Philippe Querer, Thales Director of Strategy [05:28]

• Accelerated Production Rates: Companies like KNDS France and MBDA are significantly increasing their production capacities, reducing lead times from years to months for critical military equipment.

  "The initial production rate, let's say 2023, was around 2, and now they are producing up to 12..."
  — Thierry Charlot [06:15]

• Expansion into Drone Production: Renault is transitioning from automotive components to military aircraft parts and plans to initiate drone production in Ukraine.

Quote Highlight:

"Other companies have been doing the same... the production of the Caesar cannon... accelerating the tempo for the development, especially for drones."
— Thierry Charlot [06:15]

Market Data Update

Concluding the episode, Brancaccio provides a brief update on market indicators:

• Interest Rates: The 10-year interest rate stands at 4.23%, showing a downward trend in the morning.

  "Also, interest rates are down this morning, the 10 years at 4.23%."
  — David Brancaccio [07:10]

Conclusion: The episode delves into the intricate dynamics between political pressures and economic integrity, highlighting the potential risks to market confidence and investor behavior when economic data and expert opinions are politicized. Additionally, it sheds light on the global repercussions of geopolitical tensions, exemplified by France's significant shift towards military production. Listeners are left with a nuanced understanding of how political and international developments can profoundly impact economic landscapes and market sentiments.