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Kai Ryssdal
In which we dip a toe into corporate profit reports to see what we might learn from American public media. This is Marketplace in Los Angeles. I'm Kyle Rysdal. It is Monday today, the 14th of October. Good as always to have you along, everybody. The cast of characters that affect what happens in this economy starts obviously with consumers we talk about all the time. It then snakes its way through small businesses, government, whether the politicians that be Congress and the White House or independent agencies like the Federal Reserve. It also makes a stop in corporate America, which is where we start today. We're going to be hearing a lot from the big companies in this economy in the next couple of weeks as those that are publicly traded release earnings reports for the most recent quarter. Banks started us off this past Friday. JPMorgan Chase and Wells Fargo. More will report tomorrow. And a theme that's emerging is that many of those banks have been setting aside more cash to cover bad loans. Marketplace's Justin Ho gets us going with why banks are getting more cautious.
Justin Ho
Banks always stock away some cash to cover loan losses. That's because in good times and bad banking involves a certain amount of risk. Loans go bad, hopefully not at a high rate. But there are always some people or businesses that don't pay back their loans. That's Julie Hill, dean of the University of Wyoming's College of Law. She says loan losses picked up a lot in the early years of the pandemic, and banks drew down their reserves to cover those losses. So now that the economy has recovered, you're seeing banks realizing that they're away from the downturn of the pandemic into more stable financial times, and they're wanting to restore their reserves to prepare them for the next economic downturn. But banks also have a few reasons to be concerned about certain types of loans. Steven Bigger, a bank analyst with Argus Research, says a lot of banks are nervous about their commercial real estate loans.
Kai Ryssdal
Because the vacancies are pretty high and the rates, of course, are much higher than where these loans had been taken out, you know, three and five years ago.
Justin Ho
Baker says banks are also keeping an eye on credit card debt, especially since delinquency rates have been rising.
Kai Ryssdal
So there is quite a bit of credit card lending going on, people carrying.
Matt Levin
A balance and so forth, and that's.
Kai Ryssdal
Usually not a terrific sign for the economy broadly.
Justin Ho
Banks have also been working to ensure that their credit card customers can stay on top of their payments, says David Schiff, senior managing director with FTI Consulting. One solution? Better communication.
Matt Levin
They're using more effective collections techniques to remind customers about those payments to work through solutions to help the customers to become current.
Justin Ho
Schiff says banks are also trying to keep their commercial real estate loans healthy, too. And now that interest rates are starting to fall, he says banks have been trying to work out better payment plans for properties that might be able to avoid going into default because they see.
Matt Levin
Where interest rates are going and they're going to try and hold on till the customer is able to refinance at a more effective rate.
Justin Ho
Even though the economy is uncertain right now, Schiff says banks need to keep making loans to stay profitable, and preventing loan losses is part of that strategy. I'm Justin Ho for Marketplace.
Kai Ryssdal
At the risk of repeating myself, More record highs in equities today. Bond traders had the day off. We'll have the details when we do the numbers. Oil can be a real good way to take the global economic pulse Demand for oil to be clear about which news today from the Organization of Petroleum Exporting Countries. The cartel said this morning it expects the growth in global crude demand to slow for what's left of this year and into next. To be clear, demand is still growing. We're still using lots of oil, but just less than had been expected. It is the third time in as many months that OPEC has downgraded its forecast. Marketplace's Samantha Fields has that one the.
Samantha Fields
World uses more than 100 million barrels of oil every single day, and next year it'll use even more. But OPEC sees demand growing more slowly in the coming year in one key place in particular, China.
Kai Ryssdal
Demand concerns there tend to overshadow almost anything else that novice.
Samantha Fields
Tom Tsang is with the Ralph Lowe Energy Institute at Texas Christian University. He says that's because China imports more crude oil than any other country in the world. And right now they are having economic.
Matt Levin
Problems and obviously economic woes, right? They almost always equate to less energy demand.
Samantha Fields
In addition to China's current economic troubles, Matt Smith at the data and analytics firm Kepler says it's also moving much more quickly than many other countries to adopt electric cars.
Kitchell
So that's starting to really impact gasoline demand.
Samantha Fields
At the same time, he says, China is also transitioning many of its commercial trucks over to liquefied natural gas, or lng, and away from diesel.
Kitchell
And so we're expecting both gasoline demand to be peaking around this year into next year and then diesel demand in the country to peak. And so suddenly from a country that was the engine room of the global market, you're seeing them really slowing now.
Samantha Fields
Demand for diesel is also weakening in other countries outside of China, including the U.S. according to Bob McNally at the Consulting firm Rapidan Energy Group.
Matt Levin
And diesel fuel is the fuel that's most closely linked with general economic activity because diesel is used in trucks and.
Justin Ho
Some shipping and airplanes and freight and things like that.
Samantha Fields
So he says slowing demand for diesel could be a sign of slowing economic growth. I'm Samantha Fields for Marketplace.
Kai Ryssdal
Turn with me now in your copy of the monthly jobs report that came out a couple of weeks ago to table A15, the section entitled Alternative Measures of Labor Underutilization. There are, and this is perhaps a little known fact, no less than six different measures of unemployment in this economy, labeled appropriately U1 through U6, U3 is the rate you're probably most familiar with the official Overall unemployment rate, 4.1% last month. Historically, as we've been telling you, pretty good. A little bit farther down though, is U5, the total unemployed plus discouraged workers, plus all other persons marginally attached to the labor force, which in September was 5%. Even Marketplace's Matt Levin explains why we ought to care about that number, too, and why it's been ticking up lately.
Matt Levin
According to the Bureau of Labor Statistics, Chelsea Kidd is not technically a discouraged worker. But listen to her and she might be close.
Chelsea Kidd
Every time I apply, it's like I might as well ball this resume up in paper and throw it in the nearest trash can for all the good it's going to do me.
Matt Levin
Kid is 35 and lives in Mid Coast Maine. She and her 14 year old daughter moved into her mother's place after she was laid off five months ago. She was working remotely for a financial technology company, making almost 60 grand a year monitoring customer service calls. Kidd says she's applied to somewhere between 50 and 100 jobs, but she hasn't seen many that would actually be a good fit, especially any jobs that don't require her to move.
Chelsea Kidd
I don't want to uproot my daughter right now, so I'm tied here right now and there's just I can feel the world shrinking around me when I look at the job market.
Matt Levin
Because Kidd actively searched for jobs last month, the Bureau of Labor Statistics counts her as one of the 6.8 million people officially unemployed in September. But if she took a break from all those time consuming cover letters and resumes and applications, BLS would call her a discouraged worker and not part of that official rate. So these are guys that aren't necessarily part of the unemployment pool, but they've flowed back and forth. And one of the reasons they've stopped looking for work is they just don't think there's anything out there. Jason Faberman is an economist at the Chicago Fed. He says a lot of the discouraged workforce feel their skill set is outdated. Maybe their jobs have been automated away or offshored. But there's also a lot of workers like Chelsea Kidd who just feel stuck. They're either tied to a location or choose to not look outside their location. And you know, they're just wherever they are, there just isn't much there for them. About 445,000 out of work Americans fit BLS's definition of discouraged worker last month. That's not a huge number, but when you add in the people BLS says are marginally attached to the workforce, basically folks who want a job but haven't looked in the past month for any reason, that number is big, 1.6 million. Those workers tend to skew more male and lower educated than the officially unemployed and also older. Ali Bustamante is an economist at the University of New Orleans. Just over the year, we've seen about a 200,000 increase in marginalized workers and about more than 60% of that increase has actually been driven by workers who are 55 years of age and older. Bustamante says employers might be favoring younger, cheaper talent. Older workers may also be more reluctant to accept lower wages or switch industries and have more savings to keep them afloat. While the number of discouraged and marginalized workers have ticked up along with the unemployment rate in recent months, by historical standards, we're really on target with what the labor market actually looked like back in 2019. But all the headlines about a relatively healthy labor market aren't much solace right now for Chelsea Kidd, the laid off single mother back in Maine.
Chelsea Kidd
It just feels like as in so many other situations, if you're ahead, you can keep getting ahead. And if you're behind, you get further behind.
Matt Levin
Kit says she's planning to finish her undergrad degree in the hope that it'll make her more competitive on the job market. But she's not sure if it will. Hi, I'm Matt Levin for Marketplace.
Steve Hyatt
Coming up, it turns out that the innkeeping industry is very small and we all know each other.
Kai Ryssdal
Small but mighty. First, though, let's do the numbers. Dow Industrials up 201 points today, about a half percent, 43,065. The Nasdaq added 159 points, about 9, 10%. 18,502. The S&P 500 gained 44 points, 3/4%. 58 and 59. That OPEC forecast of slowing growth in oil demand that Samantha Fields was telling us about didn't do a whole lot to hurt oil stocks. ExxonMobil pocketed four 10% today. Hess added about a 10%. Chevron picked up a quarter of 1%. The natural gas market seems to have decided there will be less demand this winter. Here in the United States, the benchmark price deflated 5 and a half percent. Natural gas producers went the same direction next Decade drew down 1.4%. CNX Resources compressed 3 and 4 10% today. Compressed natural gas. Get it? Come on. Whole lot of bad news about Boeing lately Friday and announced it's cutting 17,000 jobs and will be delivering its first 777x jets a year later than expected. Also that strike still happening. Boeing descended 1 1/3% today. Bonds, as I mentioned, did not trade today due to the holiday. You're listening to Marketplace.
Matt Levin
This Marketplace podcast is supported by Gusto. Let your employees know you've got their back by signing up for Gusto. For payroll and HR. More than 300,000 small business owners use Gusto. They offer benefits like health insurance, employee onboarding and more. Get your payroll taxes filed, deductions calculated, and your team paid fast. No more pain, just the joy of running your business. Get three months free when you go to Gusto.com marketplace that's Gusto.com marketplace.
Kai Ryssdal
This is marketplace. I'm Kai Ryssdal. As Justin Ho is telling us up at the top of the program, quarterly earnings season is upon us. Banks can, of course, tell us a whole lot about the financial health of this economy, but banking ain't the only game in town. You know we're going to hear from airlines this week, entertainment companies, AI chip makers, too. So it seemed to us a preview was in order. Marketplaces Savannah Mar has it earnings reports.
Savannah Marr
Pull back the curtain on how individual companies are faring and help answer bigger questions, says Karen Petru with Federal Financial Analytics.
Kai Ryssdal
How much consumers are spending, whether demand for a particular product is going up and what that means farther down the supply chain.
Savannah Marr
And quarterly results are playing a particular role. Now Shiraz Meehan, director at Zack's Investment Research, says an analysts are shifting their focus from macroeconomic data on the labor market and inflation to watching companies for the fallout of last month's rate cut.
Kai Ryssdal
There's been fears about whether the Fed perhaps they were late to the party and perhaps the slowdown may get out of their heads. That's kind of like the big picture theme.
Savannah Marr
This earnings season, for example, we'll hear from United this week. Sam Stovall with CFRA Research says airline earnings will give us a look at labor costs.
Kai Ryssdal
Could we be seeing companies face higher and higher expenses in that regard?
Savannah Marr
And Stovall says results in the retail and entertainment sectors, like Thursday's report from Netflix, will include tells about whether consumers are willing to keep up with high prices. Shiraz Mian with Zacks will be tuned into Thursday's earnings call with Taiwan semiconductor manufacturing company AI has been a big.
Kai Ryssdal
Theme in the marketplace, and TSM are right in the middle of that.
Savannah Marr
He says TSMC's outlook will offer a clue as to how much AI is fueling corporate growth this quarter. In a few weeks, results from a slew of tech companies will give us a fuller picture. I'm Savannah Marr for Marketplace.
Kai Ryssdal
Here's another preview of sorts. I can tell you that tomorrow morning's Marketplace Marketplace Morning Report with David Brancaccio and the Gang will tell you everything you need to know about business Neck and Huck news to start your day. Check it out. Online poker is only legally available in a handful of states, but it is a huge market globally. The research firm Custom Market Insights figures it was worth a bit more than $96 billion last year. Now what follows is not an endorsement of online poker, to be clear, only bet what you can afford to lose, but should you choose to participate. Kitchell, writing in Bloomberg the other day, discovered something interesting.
Kitchell
If you've ever played online poker in any capacity for any stakes, you've probably played against a bot and not known it.
Kai Ryssdal
I am not a gambler, so I've never played online poker either, not even in getting ready for this interview. But it does seem to me that that's a bit challenging. Yes, the scale of things means there has to be some bottom involvement, I suppose. But it does lend itself, I would imagine, to all kinds of mischief.
Kitchell
Yeah, I don't think that it's fair for a human being to play against especially a modern day bot. The way poker bots play now is kind of inhuman. It is beyond the level that even the very best professionals who have ever lived can play the game. They play sort of mathematically perfect poker and they don't make mistakes. So it isn't really a fair fight. And they are probably going to take.
Kai Ryssdal
Your money or in some cases they're like programmed to lose a little bit. And the first one's always free, right?
Kitchell
Yeah. One of the things I discovered doing this story was that not all poker bots are sort of intruders who are unwelcome and have sort of snuck onto the websites. Some websites definitely have bots that have been invited there to keep the tables looking busy and to keep people playing longer, which is a strange thing to get your head around.
Kai Ryssdal
Tell me about this company. It's called Deep Play, I think.
Kitchell
Yeah, so that's one of their names. They've actually been through a bunch of evolutions over the years, but it's the same group of guys out of Siberia in Russia who have come up with very clever poker technology and have used it in various different ways.
Kai Ryssdal
Well, say more about that. I mean, how are we seeing this employed out there? If I sit down in front of my virtual felt table there, what's it gonna look like when these bots are playing?
Kitchell
I think when you're playing against a bot, it feels almost like you're playing against someone who's cheating. They just seem to be winning and you don't know how. And it happens slowly and it feels very hopeless. I've spoken to professionals who have taken part in these tournaments against bots designed by AI researchers, and they describe this kind of hopeless feeling of just feeling like they never had a chance.
Kai Ryssdal
How do the companies who run the online poker sites feel about these bots? Because in some way, I'd imagine they kind of need them.
Kitchell
Obviously, customers, the people who play online poker don't like having bots in the system. It's not fun. It kind of takes the fun out of it. You want to play another human being. But the big poker websites and the big poker platforms online, they don't have a lot to say about botting. And, you know, what they do say is that they're opposed to the idea of it, but they're not very transparent about how they keep bots off their systems and how many bots are out there. And one of the reasons for that is that there just aren't commercial incentives to exclude all bot accounts, because they all make money. They all make money for the poker websites.
Kai Ryssdal
But if I'm a newbie, want to get involved in poker, and I decide to start playing online to, you know, sort of learn how things go, and I keep losing all the time. I'm out. Right. And that seems to me to be a business model problem.
Kitchell
It is, yeah. That is a problem. There's not an easy solution to that. There is definitely data showing that people who start playing poker online are very quickly put off by the standard of the games they're playing in, and by how often they lose and by how hopeless it feels. And that's one of the reasons why people who know about pokerbotting, the people who really know, will tell you this is an existential threat to the game. You know, Chris Moneymaker told me he's arguably the most famous poker player of the modern era. He told me the game may not exist in a few years unless we get a handle on this. And it's a new problem. I don't think the game has really adapted to the new reality yet.
Kai Ryssdal
Kid Schellel ready in Bloomberg about the Russian poker bot army about which I knew nothing until this piece. Kit, thanks a lot. I appreciate your time.
Kitchell
Thanks, man.
Kai Ryssdal
Albuquerque wrapped up its annual international balloon fiesta yesterday. It's a 10 day festival that brings almost a million visitors to the city every year to watch hundreds of hot air balloons fly over the western skies. And all those hundreds of thousands of people coming into town gotta find a place to stay, Right? Right. They do. Here's today's installment of our series, my economy.
Steve Hyatt
I'm Steve Hyatt.
Chelsea Kidd
And I'm Kathy Hyatt. And we're the owners of the Bodker mansion bed and breakfast in old town Albuquerque, New Mexico. So Steve is a New Mexico native and his family was from here. We met when we were in the service and stationed in northern Japan. We moved to New Hampshire where he got a job and stayed at a bed and breakfast there for our 10th anniversary. And it was just extraordinary. And we decided that that was something we would be interested in doing someday. And that's basically how we ended up here.
Steve Hyatt
Yeah, I always felt that I needed to be somewhere west of the Rockies. And coming back to New Mexico was great.
Chelsea Kidd
We've owned it for 20 years now. So over those years, you can imagine the use that a bed and breakfast gets. And so we've replaced every air conditioner in every room at least once and sometimes twice. We've replaced our large air conditioner for our main space twice. So there's a lot of significant infrastructure investment. Let's just say that we're not trying.
Steve Hyatt
To take it back to 1912. So the International Balloon Fiesta starts this year on October 4th and goes through October 13th. It's huge for Albuquerque in New Mexico. We tend to be full until we're well through the balloon fiesta.
Chelsea Kidd
All the hotels and lodging facilities increase their prices for balloon fiesta because the demand is so high. You know, we have to determine what our rates for rooms for balloon fiesta are going to be a year in advance because we're already starting to book for balloon fiesta for next year.
Steve Hyatt
So after balloon Fiesta, but really after the season is winding down this year, we're planning on going to San Diego to a conference of other innkeepers. It turns out that the innkeeping industry is very small and we all know each other all over the country.
Chelsea Kidd
Or we know of each other.
Steve Hyatt
Or we know of each other.
Kai Ryssdal
Kathy and Steve Hyatt, innkeepers and owners of the Bottger mansion in Albuquerque, New Mexico. Whether you are west of the Rockies or east, we want to know what's going on with you. So take a second and tell us, would you? Marketplace.org myeconomy this final note on the way out today. First of all, and not to be that guy, but it's technically not the Nobel Prize in Economics, it's the bank of Sweden Prize in Economic Sciences in memory of Alfred Nobel. He Nobel didn't make it one of the five original prizes in his will. Sorry, not sorry, just trying to be accurate. Second, and sadder, but arguably more economically impactful, Lilly Ledbetter has died. Ledbetter had worked for Goodyear for 20 years before she discovered she'd been paid less than her male colleagues. She sued. It made it to the Supreme Court, which ruled against her 5 to 4. Because she hadn't made the complaint within 180 days of when those discriminatory pay decisions were made. The Lilly Ledbetter Fair Pay act relaxed the timelines for wage discrimination lawsuits. First law Obama signed, by the way, in 2009. Our daily production team includes Andy Corbin, Lise Hassan, Maria Hollenhorst, Sarah Leeson, Shawn McHenry and Sophia Terenzio. I'm Kai Rysdal. We will see you tomorrow. Everybody, this is APM.
Marketplace Podcast Episode Summary: "Bad Debt Prep" (October 14, 2024)
In this episode of “Marketplace,” host Kai Ryssdal delves into the intricacies of the current economic landscape, focusing primarily on corporate profit reports, banking sector strategies, global oil demand, labor market nuances, the upcoming earnings season, the rise of AI in online poker, and the challenges faced by small businesses. The episode provides a comprehensive analysis of these topics, enriched with expert insights and real-life stories to offer listeners a nuanced understanding of today’s economic environment.
The episode kicks off with an exploration of the banking sector's increasing caution in the face of potential bad loans. As publicly traded companies prepare to release their quarterly earnings, banks are setting aside more cash reserves to mitigate potential loan losses.
Justin Ho, a correspondent from Marketplace, explains, “Banks always stock away some cash to cover loan losses. That's because in good times and bad, banking involves a certain amount of risk” (00:01). Julie Hill, dean of the University of Wyoming's College of Law, adds historical context, noting that loan losses surged during the early pandemic years, prompting banks to deplete their reserves. With the economy stabilizing, banks are now rebuilding these reserves to brace for future downturns.
The conversation highlights specific areas of concern within the banking sector:
Commercial Real Estate Loans: Steven Bigger, a bank analyst with Argus Research, points out that banks are increasingly anxious about commercial real estate loans due to high vacancy rates and elevated interest rates compared to those from three or five years ago (02:06).
Credit Card Debt: Rising delinquency rates have banks vigilant about credit card debt. David Schiff, senior managing director with FTI Consulting, mentions that banks are enhancing communication with customers to ensure timely payments and working on better payment plans to prevent defaults (02:30).
Moreover, as interest rates begin to decline, banks are strategizing to offer more flexible payment plans for commercial properties, aiming to maintain loan health and profitability despite economic uncertainties (02:50).
Transitioning from the banking sector, the podcast addresses the oil market's current state. Samantha Fields, Marketplace's correspondent, discusses the latest forecast from the Organization of Petroleum Exporting Countries (OPEC), which anticipates a slowdown in global crude demand growth for the remainder of the year and into the next (04:28). Although demand remains positive, the revision marks the third consecutive downgrade in OPEC's outlook.
Key factors influencing this trend include:
China's Economic Slowdown and Energy Transition: Tom Tsang from the Ralph Lowe Energy Institute at Texas Christian University emphasizes China's significant role as the world's largest crude importer. Economic challenges and accelerated adoption of electric vehicles are curbing oil demand (04:40). Matt Smith from Kepler Data and Analytics further explains that China is shifting commercial trucks to liquefied natural gas (LNG) and away from diesel, anticipating a peak in gasoline and diesel demand (05:14).
Impact on Diesel Demand Globally: Bob McNally of Rapidan Energy Group notes weakening diesel demand in countries like the U.S., underscoring diesel's close tie to economic activity through its use in transportation and shipping (05:52). This decline is perceived as a potential indicator of slowing economic growth (06:00).
The episode underscores how OPEC's revised demand forecasts, particularly concerning China, have broader implications for global economic indicators tied to energy consumption.
Kai Ryssdal shifts focus to the labor market, highlighting the complexity behind unemployment statistics. The monthly jobs report reveals six different measures of unemployment, from U1 to U6, with U3 being the most widely recognized official unemployment rate, standing at 4.1% last month (06:40).
Matt Levin, Marketplace's correspondent, explores the significance of broader measures like U5, which includes the officially unemployed, discouraged workers, and those marginally attached to the labor force, totaling 5% in September (07:33). Through personal stories, such as that of Chelsea Kidd, a 35-year-old from Mid Coast Maine, the episode humanizes these statistics. Kidd, who has applied to nearly 100 jobs without success, illustrates the struggles of those who are technically unemployed but face additional barriers to reemployment (07:42).
Jason Faberman, an economist at the Chicago Fed, discusses reasons behind the rise in discouraged workers, including skill obsolescence and geographical constraints (08:30). Ali Bustamante, an economist at the University of New Orleans, highlights demographic trends, noting a significant increase in marginalized workers aged 55 and older, attributing this to factors like employer preferences for younger, cheaper labor and older workers' reluctance to accept lower wages or switch industries (09:30).
The segment concludes by contextualizing the current labor market within historical trends, emphasizing that despite recent increases in marginalized unemployment measures, the labor market remains robust compared to pre-pandemic levels. However, for individuals like Chelsea Kidd, the broader statistics offer limited reassurance (10:45).
As the episode progresses, Kai Ryssdal previews the impending earnings season, emphasizing its critical role in gauging the economy's health. Savannah Marr, Marketplace's correspondent, elaborates on how earnings reports can reveal consumer spending patterns, demand trends for specific products, and downstream effects on supply chains (13:53).
Key points discussed include:
Shifting Analyst Focus: Shiraz Meehan, director at Zacks Investment Research, observes that analysts are pivoting from macroeconomic indicators like labor and inflation data to corporate earnings, particularly in the context of the recent Federal Reserve rate cut (14:03).
Sector-Specific Implications:
The discussion underscores the earnings season as a multifaceted lens through which the economy's trajectory can be assessed, highlighting the interplay between corporate performance and broader economic indicators.
A particularly intriguing segment addresses the infiltration of artificial intelligence in online poker, posing significant challenges to the integrity and future of the game. Kitchell, a Bloomberg contributor, uncovers the prevalence of AI-driven poker bots that dominate virtual tables, often unbeknownst to human players (16:46).
Key insights include:
Unfair Playing Field: Kitchell describes how these bots operate with mathematically perfect strategies, making no mistakes and often unsettling human players who feel they are simply being outplayed with no hope of success (17:14).
Manufacturer Perspectives: While customers vehemently oppose the presence of these bots, poker websites maintain a tacit tolerance, benefiting from the continuous activity bots generate (19:11). The lack of transparency regarding bot management raises concerns about the platforms' commitment to fair play.
Impact on New Players: For novices, encountering these bots can be discouraging, leading to rapid disengagement from the game. Kitchell highlights testimonials from professional players who perceive pokerbotting as an existential threat, potentially jeopardizing the game's future unless effective measures are implemented (19:47, 20:41).
The segment concludes with a cautionary note on the long-term sustainability of online poker in its current state, emphasizing the urgent need for industry reforms to address the pervasive influence of AI bots.
Shifting to a more localized economic narrative, the episode features Steve and Chelsea Kidd, owners of the Bodker Mansion Bed and Breakfast in Albuquerque, New Mexico. They discuss the economic boost brought by the annual International Balloon Fiesta, a significant event attracting nearly a million visitors over ten days (21:19).
Highlights include:
Infrastructure Investments: Over two decades of operation have necessitated substantial investments in the property, including multiple replacements of air conditioning units, showcasing the challenges of maintaining a historic establishment (22:29).
Economic Impact of the Fiesta: The Kidds note that demand during the Balloon Fiesta period drives occupancy rates to near full capacity, compelling them to set room rates a year in advance to accommodate the surge (23:22).
Industry Networking: Post-fiesta, Steve plans to attend a conference for innkeepers in San Diego, emphasizing the close-knit nature of the innkeeping community and the collective strategies employed to navigate seasonal demands (23:47).
This narrative provides a microcosmic view of how seasonal events can significantly influence small businesses, highlighting both the opportunities and operational challenges they entail.
In concluding segments, Kai Ryssdal touches upon notable economic milestones and legacies:
Bank of Sweden Prize in Economic Sciences: Ryssdal clarifies a common misconception, noting that this prestigious award, often mistaken for a Nobel Prize in Economics, was established in memory of Alfred Nobel, who did not include it in his original will (21:41).
Lilly Ledbetter's Legacy: The episode pays tribute to Lilly Ledbetter, whose fight against pay discrimination led to the Lilly Ledbetter Fair Pay Act of 2009. Ledbetter's battle against Goodyear culminated in a Supreme Court ruling unfavorable to her, sparking legislative change to extend the time frame for wage discrimination lawsuits (21:41).
These segments serve as reminders of the ongoing evolution of economic policies and the individuals who influence them, underscoring the interplay between personal struggles and legislative advancements.
The "Bad Debt Prep" episode of Marketplace weaves together a diverse array of economic narratives, from the cautious strategies of the banking sector and global energy demand trends to the complexities of the labor market and the disruptive influence of AI in online gaming. Through expert interviews, personal stories, and in-depth analysis, the episode offers listeners a multifaceted understanding of the current economic climate. Whether examining the ripple effects of corporate earnings, the challenges faced by small businesses during major events, or the ethical quandaries posed by technological advancements, Kai Ryssdal and the Marketplace team provide insightful commentary that demystifies the complexities of the modern economy.