Hope or fear?

Summary

Marketplace Podcast Summary: "Hope or Fear?"

Episode Information:

• Title: Hope or Fear?
• Host: Kai Ryssdal
• Release Date: February 27, 2025
• Description: Every weekday, host Kai Ryssdal helps listeners make sense of the day’s business and economic news—no econ degree or finance background required. “Marketplace” takes you beyond the numbers, bringing you context through interviews with CEOs, policymakers, and everyday people.

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1. Economic Growth and Durable Goods Orders

Gross Domestic Product (GDP) Growth Kai Ryssdal opens the episode by discussing the latest GDP figures, reporting a 2.3% annualized growth rate for the fourth quarter of the previous year. This growth aligns with expectations but shows a slight deceleration compared to the third quarter.

Durable Goods Orders Justin Ho delves into the rise in orders for durable goods, which are indicators of business investment and future economic activity. Despite the volatility often associated with durable goods data, orders for capital equipment saw an increase of nearly 1% in January, marking the third consecutive monthly rise.

Insights from Economists

• Bernard Yaros, Lead US Economist at Oxford Economics: “[...] An order captures the demand for goods that will get produced and later shipped.” (02:20)
• Chris Varveris, Senior Advisor at KPMG Economics: Highlights the surge in spending on advanced manufacturing facilities, including chip manufacturing, electric battery, and vehicle facilities. He notes that many of these facilities are now operational, leading to increased orders for production equipment.
• Greg Warwick, CEO of TMB Banking: Expresses caution, stating, “We’re just being conservative right now in terms of our spending as a result of some of that uncertainty.” (03:40)

Conclusion on Durable Goods Orders Justin Ho concludes that while the rise in durable goods orders typically signals economic optimism, current uncertainties—particularly around tariffs—might temper the positive outlook.

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2. Labor Market Analysis Amid Economic Uncertainties

Unemployment Claims Surge Kai shifts focus to the labor market, highlighting a significant increase in first-time unemployment claims—242,000 last week, up by 22,000. While this data point is volatile, it suggests potential shifts in the labor landscape.

Historical Context and Current Trends

• Samantha Fields: Notes that the labor market began the year strong with a low unemployment rate of 4%, sustained for 39 months, a longevity last seen in the 1960s.
• Gregory Dacko, EY: Affirms that the labor market remains solid, but expresses concerns over policy uncertainties in Washington affecting business investment and consumer spending.

Expert Opinions

• Heidi Schierholtz, Economic Policy Institute: “This week's bump in unemployment claims isn't really something to worry about.” (05:56)
• Andrew Stetner, Century Foundation: Emphasizes the importance of monitoring the labor market for signs of weakness, especially as hiring slows and federal layoffs begin to impact employment figures.

Impact of Tariffs on the Labor Market The discussion transitions to how impending tariffs—specifically the 25% import taxes on goods from Canada and Mexico and the doubling of the 10% tariff on Chinese imports—are influencing business decisions and labor market stability.

• Gretchen Blau, Customs Brokerage Manager at Logistics Plus: Describes the confusion and strategic adjustments businesses are making in response to rapidly changing tariff policies. “[...] Many of our customers are importing more to keep inventory ready for the new tariffs.” (08:40)

Conclusion on Labor Market Despite a robust labor market, rising unemployment claims and policy-induced uncertainties suggest potential challenges ahead, warranting cautious optimism.

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3. Tariff Policies and Their Economic Implications

New Tariff Implementations Kai details recent presidential announcements on tariff changes:

• March 4th: 25% import taxes on all imports from Canada and Mexico.
• Effective immediately: Doubling of the 10% tariff on all Chinese imports.

Business Response and Challenges

• Gretchen Blau: Highlights the operational challenges businesses face due to inconsistent and rapidly changing tariff information. “[...] It’s hard to price accurately when tariffs are subject to change.” (08:40)
• Industry Impact: Increased tariffs are leading businesses to expedite equipment purchases before costs rise further, while others adopt a wait-and-see approach, creating mixed signals in durable goods orders.

Consumer Impact A recent Harris poll cited by Kai reveals that 59% of Americans believe tariffs will raise the cost of everyday goods, underscoring consumer concerns and potential shifts in spending behavior.

Conclusion on Tariffs The implementation of new tariffs is a double-edged sword, aiming to protect domestic industries but simultaneously introducing uncertainty and cost increases that affect both businesses and consumers.

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4. Rebuilding After Wildfires: Balancing Speed and Sustainability

Case Study: Eaton Fire in Altadena Kelly Wells reports on the challenges faced by families rebuilding after the Eaton wildfire in Altadena. The focus is on the tension between expedited rebuilding processes and the necessity for sustainable, resilient housing.

Incentives and Constraints

• State Regulations: Victims are incentivized to rebuild homes that are “substantially equivalent” to pre-fire structures to benefit from expedited permitting. However, this often means rebuilding with outdated, fire-prone materials.
• Dan Brune, Local Architect: Critiques the restrictions, noting that adhering to old designs compromises safety and cost-efficiency. “[...] You might not be able to afford it and it might burn just like the old one did.” (13:33)

Innovative Solutions

• Ben Stapleton, U.S. Green Building Council, California: Proposes collective purchasing of sustainable materials to reduce costs and enhance the resilience of rebuilt homes.
• Proposed Model Homes: Brune suggests developing standardized home templates that can be mass-produced quickly and sustainably, drawing a parallel to the Ford Model T’s efficiency.

Labor Shortage Challenges The rebuilding process is further hindered by a lack of skilled contractors in Los Angeles, limiting the ability to construct new homes swiftly.

Conclusion on Rebuilding Effective rebuilding post-wildfires requires balancing speed with sustainability. Innovative approaches and overcoming labor shortages are crucial for creating resilient communities.

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5. The Struggle in the Used Car Market

Impact of Leasing Changes on Used Car Supply Henriett reports on the repercussions of reduced leasing options on the used car market. Leasing typically results in a steady influx of well-maintained, three-year-old vehicles, but the decline in leasing has led to scarcities and increased prices in this segment.

Economic Mechanics

• Jonathan Banks, J.D. Power: Explains that leases end around the three-year mark, supplying the used car market with high-quality vehicles.
• Ivan Drury, Edmunds: Highlights that with fewer leases, the average ownership period extends to six or seven years, reducing the turnover of used cars and driving up prices.

Market Outlook

• Kristin Gek, Federal Reserve Bank of Chicago: Predicts a prolonged period of high used car prices due to sustained supply shortages.

Consumer Impact Dealers are increasingly selling higher-mileage vehicles to meet demand, but these are less desirable, leaving consumers with fewer options for quality used cars. “[...] Normally that's not a hot item, but take what you can get.” (19:45)

Conclusion on Used Cars The decline in leasing has introduced significant strain on the used car market, leading to higher prices and reduced availability of quality vehicles, a trend likely to persist for years.

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6. The Rise of Med Spas: A Growing Trend in Aesthetic Services

Explosive Growth of Med Spas Amanda Mull explores the surge in med spas, noting a sixfold increase from 2010 to 2023. These establishments blend medical treatments with spa-like services, catering to the growing demand for aesthetic enhancements.

Services Offered Med spas provide a variety of treatments, including:

• Botox and Dermal Fillers: Popular for reducing wrinkles and enhancing facial features.
• Laser Hair Removal: A long-term solution for unwanted hair.
• Non-Medical Services: Such as eyelash extensions and microblading for eyebrows.

Regulatory Environment Regulation varies by state, allowing med spas to be operated by nurse practitioners, physician assistants, registered nurses, and, in some cases, requiring doctor supervision. This flexibility lowers barriers to entry, facilitating rapid expansion.

Economic Drivers

• Technological Advancements: Improvements in medical aesthetic treatments have made them more effective and accessible.
• Consumer Awareness: Increased visibility through reality TV and social media has boosted demand.
• Business Model: Med spas operate on a cash-based model, eliminating the need for insurance dealings and providing streamlined revenue channels.

Industry Challenges

• Aesthetic Trends: Rapidly changing beauty standards require med spas to continuously adapt their services.
• Quality of Services: Varied regulations can lead to inconsistencies in service quality and safety.

Personal Insights Amanda Mull shares her personal experience, noting significant advancements in treatments since her last visit in the mid-2000s, though she faced some dissatisfaction with earlier laser hair removal services.

Conclusion on Med Spas The med spa industry is flourishing due to technological advancements, increased consumer demand, and a flexible regulatory environment. However, maintaining high standards and adapting to evolving aesthetic trends remain ongoing challenges.

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7. Market Movements and Consumer Sentiment

Stock Market Overview Kai provides a snapshot of the stock market, highlighting declines across major indices:

• Dow Industrials: Down 0.5%, closing at 43,239.
• NASDAQ: Dropped 2.8%, closing at 18,544, influenced significantly by Nvidia’s performance.
• S&P 500: Fell 1.6%, ending at 58,061.

Consumer and Bond Markets

• Consumer Sentiment: Downward trend noted.
• Inflation Expectations: Rising, contributing to market volatility.
• Bond Prices: Decreased, with the 10-year Treasury yield rising to 4.26%.

Tariff Impact on Consumers A Harris poll reveals that 59% of Americans believe tariffs will increase the cost of everyday goods, aligning with economic trends observed.

Conclusion on Market Sentiment The combination of declining stock indices, rising bond yields, and increasing consumer inflation expectations paints a picture of economic uncertainty, reflecting both hopes and fears for the future.

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Closing Notes: Kai Ryssdal wraps up the episode by acknowledging the complex interplay of economic indicators and consumer behaviors. He underscores the importance of staying informed as businesses and policymakers navigate these challenging times.

Acknowledgments:

• Editing Team: John Buckley, John Gordon, Noya Carr, Diantha Parker, Amanda Petra, Stephanie Sieck
• Managing Editor: Amir Bibawe

Next Episode Teaser: Listeners are encouraged to tune in the following day for more insights and updates on the evolving economic landscape.

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This summary captures the key discussions, insights, and conclusions from the "Hope or Fear?" episode of Marketplace, providing a comprehensive overview for those who haven't listened.

Transcript

[Marine Speaker]

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[Kyle Rysdal]

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[Justin Ho]

Switch upfront payment of $45 for three month plan equivalent to $15 per month required. Intro rate first three months only, then full price plan options available, taxes and fees extra. See full [e-mail] on the program.

[Kyle Rysdal]

This Thursday, we'll dabble in the labor markets. We'll drive by the auto industry and we'll go to a spa. From American Public Media, this is Marketplace in Los Angeles. I'm Kyle Rysdal. It is Thursday today. This one is the 27th of February. Good as always to have you along, everybody. We measure this economy, as you know, within an inch of its metaphorical life. Those measurements come in varying degrees of importance. And today we got a biggie, gross domestic product. How much this economy grew in the fourth quarter of last year, 2.3% on an annualized basis, exactly in line with expectations, although to be clear, a bit slower than third quarter growth. We also got this morning, courtesy of the Commerce Department, orders for durable goods, stuff that's supposed to last three years or more. But those orders were up in January. And when you set aside the always volatile and very expensive categories of defense and airplanes, orders for capital equipment were up almost 1%. That's the third monthly increase in a row. And as Marketplace's Justin Ho reports, those orders can shed some light on how businesses are thinking about things in this economy.

[Bernard Yaros]

A big reason economists pay attention to durable goods orders is because an order today can be a leading indicator.

[Marine Speaker]

An order captures the demand for goods.

[Bernard Yaros]

That will get produced and later shipped. That's Bernard Yaros, lead US Economist at Oxford Economics. He says a pickup in orders is a good sign for the manufacturers that make durable goods and the companies that buy them. That's because investing in equipment can help those companies boost productivity, you know, especially if this equipment is being put to use to save on labor to have more output. One reason equipment orders have been rising is because spending on advanced manufacturing facilities has skyrocketed in recent years, says Chris Varveris, senior advisor at KPMG Economics.

[Kyle Rysdal]

These could be chip manufacturing facilities, electric battery facilities, electric vehicle facilities.

[Bernard Yaros]

And now that many of these facilities have been built, the next step in.

[Kyle Rysdal]

This process would be to order and build the machines that go into these buildings to produce what they were intended to produce.

[Bernard Yaros]

But Varvera says there's another reason businesses have been ordering new equipment. They're nervous about tariffs, which could make that equipment more expensive. After all, equipment manufacturers in the US Rely on imported components and raw materials.

[Kyle Rysdal]

And since many of these are subject to pretty sharp increases in tariffs that will add to the costs of these capital goods, many firms are wanting to get these in place ahead of the tariffs.

[Bernard Yaros]

In South San Francisco, Greg Warwick, CEO of the equipment supplier TMB Baking, says many of his customers aren't sure whether they should buy equipment ahead of any potential tariffs.

[Kyle Rysdal]

It's causing some apprehension. Some of them are moving forward more quickly. Others are waiting a wait and see.

[Bernard Yaros]

And even though some customers are buying equipment now, Warwick says his company doesn't feel comfortable, say, investing in new inventory or expanding.

[Kyle Rysdal]

We're just being conservative right now in terms of our spending as a result of some of that uncertainty.

[Bernard Yaros]

In other words, the recent pickup in durable goods orders might not be a good sign about where the economy's headed. I'm Justin Ho for Marketplace Wall Street Today.

[Kyle Rysdal]

Well, look, we could tell you and we will, but you might wish we hadn't. Details, numbers. I'm gonna guess the sad music when we get there. There's a certain kind of economic data point that usually gets noted. It gets filed away someplace and then everybody largely moves on. I'm thinking here of indicators that are notoriously volatile. They bounce around a lot. First among equals of which is the weekly data on first time claims for unemployment benefits. We talked about them a lot in the early days of the pandemic. Lately, though, in more normal times, not so much. But we did learn this morning that 242,000 people filed first time claims this past week. That's an increase of 22,000, which is a lot. Again, notoriously volatile. So there's only so much that data point can tell us. But if you take it alongside everything else that's happening in this economy, it does tell us something. Marketplace's Samantha Fields has that one.

[Samantha Fields]

The labor market started off this year strong with a low unemployment rate of 4%, and it had been at or.

[Justin Ho]

Below 4.2% for 39 months.

[Gretchen Blau]

Like the last time, unemployment was that low for that long was in the 1960s.

[Samantha Fields]

Heidi Schierholtz @ the Economic Policy Institute says as of this January, the whole economy was strong and on its own. This week's bump in unemployment claims isn't really something to worry about.

[Justin Ho]

But many data sources are now starting to flash yellow. Some are even starting to flash red. Stock markets are down, bonds are down. Consumer sentiment is down. Inflation expectations are way up. All of those are going in the wrong direction.

[Samantha Fields]

And looking at the bump in weekly unemployment claims in that context does give her pause. Andrew Stetner, too.

[Marine Speaker]

The butterflies are there.

[Samantha Fields]

Stetner's at the Century foundation, and he says the labor market has been key to the economy's recent strength.

[Marine Speaker]

So we're really looking closely to see if there's any signs of weakness.

[Samantha Fields]

Hiring has slowed. That's been showing up in recent data. But are more people losing their jobs right now?

[Marine Speaker]

The big assault on labor market are these unprecedented federal layoffs.

[Samantha Fields]

But most federal employees who've lost their jobs recently are not counted in this weekly jobless claims number.

[Marine Speaker]

And the fact that we're seeing unemployment claims start to go up even before we feel the impact of the federal layoffs, that's a big concern for me.

[Samantha Fields]

In general, the labor market still looks solid overall, says Gregory Dacko at ey. But all the policy uncertainty in Washington right now is a real concern.

[Marine Speaker]

If business leaders start to adopt a wait and see approach, given all the unknowns regarding immigration policy, regarding trade policy, regarding tax policy, that will weigh on.

[Samantha Fields]

The labor market and ripple through to consumer spending, too. I'm Samantha Fields for Marketplace.

[Kyle Rysdal]

1 reports on tariff policy in this economy right now at one's own peril, changing daily as it does. But as of right now, and this was indeed confirmed today by the President of these United States, 25% import taxes, which are paid by consumers, 25% import taxes go into effect on all imports from Canada and Mexico on Tuesday, March 4th. That same day, the 10% tariff on all Chinese imports that went into effect earlier this month is going to double. So we went straight to our source for what this means out in the actual economy. Gretchen Blau is our customs broker at Logistics plus in Erie, Pennsylvania.

[Gretchen Blau]

Well, it's been a little confusing for our customers, a little confusing for us as well. Things seem to be changing on on a daily basis. We rely mostly on news sites to give us updates. We had one of our team visiting in Mexico giving us real time updates from down there, but not an awful lot on the government websites, which makes it a challenge to actually prove to some importers and other forwarders with whom we work that this is official stuff. That's been quite a frustration there. I have a lot of alerts on, you know, all the new services I subscribe to on my phone and then end up sending that to the ops team so they can and our marketing team so that they can pass it along to their customers. And it's a lot I've got. I walked into someone's office today, yesterday, and she, she was like, and what news are you bringing me today? Like, what's going to affect us now? We've had customers that have been importing since the beginning of the year, probably more than they normally would, in order to keep stuff in inventory and then looking for regular warehousing to keep those goods here in the US So that they are available in case this, you know, the tariffs with Mexico and Canada happened. And it looks like they are going to on March 4th. We've had a disclaimer on our emails, just we're giving you an estimate of what's in effect for today and it could change at any time. And that's beyond our control. A lot of importers are frustrated because they're trying to plan for their summer construction projects is an example, and they don't really know what tariffs are going to be in place at that point. So it's a little hard to do pricing. We're just being really flexible, being able to pivot whenever necessary. We do expect to stay really busy, especially with we're ramping up for, you know, a lot of construction and whatnot. So we're constantly going to be answering questions, telling people, you know, this, this is what the duty rate is. Now, here's your new landed cost as opposed to what you were probably planning at this point last year.

[Kyle Rysdal]

Changing every day. Gretchen Blau, customs brokerage manager at Logistics plus in Erie, Pennsylvania. The last big destructive wildfire that we had out here in Southern California, the Woolsey fire in Malibu, was more than six years ago. And most of the homes that burned back then have yet to be rebuilt. Local officials know that's a problem, a big one, which is why they fast tracked the permitting process after Altadena and the Palisades burned to get people back into their homes faster. But as Marketplace's Kelly Wells reports, in the long run, some of those rules might not be as helpful as they sound.

[Justin Ho]

Steven Siegel and his family pulled their U Haul up to a warehouse stocked with everything they'd need to start over. They're roughly 12 miles from where their home in Altadena burned last month in the Eaton fire. As they pulled in the warehouse, volunteers welcomed them with a cheer.

[Marine Speaker]

Oh, my God, are you kidding me?

[Justin Ho]

They got a couch, a dining table, toiletries, everything. Except, of course, a house.

[Marine Speaker]

We are planning to rebuild.

[Kyle Rysdal]

Just mostly the deal we made with.

[Marine Speaker]

The kids was we'll give them this house.

[Justin Ho]

And so we want that house, Literally that house. A copy of the 1912 home they lived in for 20, 20 years. Siegel has a couple of incentives to build something new that's substantially equivalent, as California law puts it, to what was there before. One is money.

[Marine Speaker]

You have to build the same house or else your property tax goes way up. And our house was really perfect. It was really perfect.

[Justin Ho]

The other incentive is time. If fire victims build their new houses in roughly the same footprints as the old one, the state lets them bypass the months long environmental permitting process.

[Bernard Yaros]

Now that all sounds all fine and.

[Marine Speaker]

Dandy and you feel like, oh my God, everybody's going to be able to build really quickly.

[Justin Ho]

But there are a couple of big caveats, says local architect Dan Brune. One person asked him to rebuild a decades old Cape Cod style house, but with more flame resistant materials.

[Marine Speaker]

You can get a version of that today. And I have some clients that we are doing things like that. It is costly. So, so, so, so costly.

[Justin Ho]

Plus, some of the houses that were there had wooden shingles and wooden shutters, even some wrap around wooden porches.

[Marine Speaker]

We shouldn't have built those to begin with. Those shouldn't have been built there. You're in Los Angeles, in Southern California, not the Northeast. So that worries me big time.

[Justin Ho]

So to rebuild faster, you have to build the same house, but you might not be able to afford it and it might burn just like the old one did. Which is why some building professionals are thinking bigger picture. How to design neighborhoods that are cheap and quick to build and are more resilient for the next wildfire. Ben Stapleton leads the nonprofit U.S. green Building Council, California.

[Marine Speaker]

One of the things I'm trying to work on right now is can I get some folks together to do like some pooled purchasing group buying for things like clean concrete or steel or wood.

[Justin Ho]

The idea is get a bunch of fire victims together to buy sustainable materials and their homes are cheaper and more resilient. Good for the planet and for the victims waiting to move back home.

[Marine Speaker]

At the end of the day, what we shouldn't be talking about is, hey, these are going to be more sustainable, resilient homes. What we should be saying is these are going to be built cheaper, faster.

[Justin Ho]

And safer, faster, but still not fast enough for architect Dan Brun. He proposes designing a few model home templates for victims to pick from. Houses that can be built quickly, cheaply and sustainably. Then mass produce them like Ford did with the Model T. That's what we.

[Marine Speaker]

Need to be doing. We have this amazing opportunity. Why should we be going back?

[Justin Ho]

All of this talk of rebuilding is still up against a labor shortage. Los Angeles contractors mostly renovate homes the county doesn't have nearly enough who know how to build new ones from the ground up. In Los Angeles, I'm Kaylee Wells for Marketplace.

[Amanda Mull]

Coming up, you can order supplies including Botox, filler, things like that on the Internet.

[Kyle Rysdal]

Not just anybody to be clear. First though, let's do the numbers. Yeah. The Wawas Dow Industrials down 193 half a percent, finished at 43,239. The NASDAQ hang on to your hats. Down 530 points. 2.8%. Closed at 18,544. Thank you Nvidia. The S&P 500 sank 94 points, 1.6%. 58 and 61 at the end. Oh, the day we get PCE to mar the personal consumption expenditures price index inflation fed style. So some consumer facing stocks. Why don't we. Kohl's which recently announced it's cutting 10% of its corporate workforce down 4.6%. Walmart up six tenths of 1%. Best Buy down 2%. Bond prices fell. Yield on the 10 year treasury note rose 4.26%. You're listening to Marketplace. This is Marketplace. I'm Kai Ryssdal. Here's a story from the time and this economy are a flat circle department. 3ish years ago we were spending a lot of time on this program talking about all the things that had resulted in a serious shortage of new cars. I am reasonably sure you don't need a reminder, but all that stuff that happened three years ago is making some used cars more expensive today. That's according to Edmunds, which says that in the last quarter of 2024, the price of three year old used cars, the relatively few that is that were delivered during that shortage, their prices were up more than 3%. Here's Marketplace's Henriett.

[Marine Speaker]

Traditionally a three year old car is kind of the gold standard in the used car market because three years is often the length of a new car lease. So when leases are up and the lessees get in their next vehicles, they're old cars hit the used market, says Jonathan Banks at J.D. power. And there's a lot of demand for them.

[Kyle Rysdal]

It's usually like lower mileage. It's usually in pretty good condition because when you have a lease, you know you got to turn it back in.

[Marine Speaker]

So you take good care of it. It's just like a really, really nice car. The problem now is three years ago.

[Kyle Rysdal]

Leasing went away effectively and so that.

[Marine Speaker]

Those lease maturities that you normally would.

[Kyle Rysdal]

See coming back from 2022, new vehicle.

[Marine Speaker]

Sales, we're just not seeing any. The new car market in 2022 was kind of a mess. Supply chain snarls Limited new vehicle production, but demand was high. And so Ivan Drury at Edmunds says dealers stopped offering inexpensive lease options. They just took those away. There was no need for them to essentially juice the sales, as we call it, and people had to purchase. And when drivers purchase a car, he says, they typically keep it longer. So what normally would have just shown up at the dealership in two or three years is now going to take probably six or seven years. Taking away that supply puts upward pressure on used vehicle prices, which already have been pretty high since the shortage of new cars drove a lot of new car buyers to the used market. And supply problems on that used market aren't likely to go away, says Kristin G? Cek at the Federal Reserve bank of Chicago.

[Gretchen Blau]

It's like this big rat that has.

[Kyle Rysdal]

To go through the snake. I guess it's going to take years.

[Gretchen Blau]

Before we really get on the other side of it.

[Marine Speaker]

Until then, for people looking for that three year old off lease car, the market's going to be tough, G? Cek says.

[Amanda Mull]

We've seen dealers, you know, they say they're getting hits on cars that have, you know, 100, 120, 130,000 miles on them.

[Marine Speaker]

Normally that's not a hot item, but take what you can get, I guess. I'm Henry Amp for Marketplace.

[Kyle Rysdal]

I was perusing Bloomberg Business Week the other day, as one does, when I saw a piece that kind of stopped me. It was about a kind of business called a med spa. Businesses that it seems are flourishing right now. Six times as many of them in 2023 as there were in 2010. That's according to the American Med Spa Association. Amanda Mull had the story. She's a senior reporter at BusinessWeek. Good to talk to you again.

[Amanda Mull]

Thanks so much for having me.

[Kyle Rysdal]

I will confess to not having been familiar with the phrase med spa before I came across this piece you wrote. What are they?

[Amanda Mull]

Med spas are like a middle ground between a hair salon or a nail salon and a dermatologist office. They are usually storefronts in strip malls, malls all over the place that provide a slew of aesthetic medical services.

[Kyle Rysdal]

I would say give me, for instance, on the services.

[Amanda Mull]

Botox is a huge one. You also get things like dermal fillers, so lip plumper. You can do laser hair removal. And then there are some things that don't require medical intervention. A lot of them also offer, like eyelash extensions, microblading for your eyebrows, all kinds of different things.

[Kyle Rysdal]

I've never understood that microblading thing, but that's a guy speaking, I suppose, who works inside. I mean, they're not doctors. Are they doctors? I don't know.

[Amanda Mull]

It depends on the state. Regulation for these types of businesses is done at the state level and varies pretty widely depending on where you are. But most states, what you're actually going to find is they can be run by nurse practitioners, physician's assistants, registered nurses, and even in states where these services need to be supervised by a doctor, mostly when you go in for a service, the person who's going to be treating you is going to be a nurse.

[Kyle Rysdal]

Why are they then, as you point out in your piece, proliferating so greatly?

[Amanda Mull]

Well, there's a sort of a combination of reasons. One thing is that a lot of the types of services that they offer have gotten a lot better over the past 15 years. Pharma companies have gone sort of all in on developing these treatments. So there's a really wide variety of them available now, and a lot of people are aware of them thanks to reality TV and social media that wouldn't have necessarily been otherwise privy to all of these options on the provider end. Med spas are almost entirely cash businesses. You don't have to deal with insurance. So if you are someone who can inject medication, which is pretty much any doctor or nurse, then you can move over to this business, make like really good money, and get rid of a lot of the stresses that might exist in more traditional medical practice.

[Kyle Rysdal]

Sounds like barriers to entry are pretty low.

[Amanda Mull]

Yes. One of the reasons that these have popped up in so many places is that it doesn't take a lot of startup capital to start one. If you have the correct medical licensure, then you can, you know, open up a storefront or rent a salon suite, and you can order supplies, including Botox filler, things like that on the Internet. As long as you're licensed.

[Kyle Rysdal]

Oh, all right. Okay. All right.

[Amanda Mull]

As long as you're licensed. And once you sort of, you know, build up a following, you have people who are coming back pretty regularly for treatments that they pay for in cash.

[Kyle Rysdal]

The catch, of course, is that this is a business based. These are businesses based largely on aesthetics. And aesthetics, as we know, change.

[Amanda Mull]

Yes, yes, the med spa look, shall we say, is Wait, now you have.

[Kyle Rysdal]

To describe the med spa look.

[Amanda Mull]

People can sort of pick out the types and number of treatments that you've potentially had based on what your face looks like, the over plumped lips, the ultra smooth, wrinkle free skin. It is like sort of a tight, waxy kind of look or it's lumpy depending.

[Kyle Rysdal]

Without getting too personal here, did you partake of services and without specifics? Again, were you generally satisfied as you were reporting this piece?

[Amanda Mull]

You know, it's been kind of a long time since I've partaken in any med spa services. Not that I judge, but I did many, many years ago get some laser hair removal and was a little bit unsatisfied with that. I was, I was in college, so this was like the mid 2000s. There are many, many generations of laser that have been introduced since then and a lot of people seem to enjoy their results.

[Kyle Rysdal]

Amanda Mull, senior reporter at Bloomberg Businessweek, talking about medspas. Amanda, thanks a lot. Good to have you on.

[Amanda Mull]

Thanks so much for having me.

[Kyle Rysdal]

This final note on the way out today in which our work here at Marketplace is almost done, there's a new Harris poll out done for Bloomberg, taken February 6th to 8th. If you're a detail person, here's the headline. 59% of Americans think tariffs will raise the cost of everyday goods. That is the right answer. By the by 15% say tariffs will not have an impact. 11% say tariffs will lower consumer prices. Like I said, we got some work to do. John Buckley, John Gordon, Noya Carr, Diantha Parker, Amanda Petra and Stephanie Sieck are the Marketplace editing staff. Amir Bibawe is the managing editor and I'm Kyle Rysdal. We will see you tomorrow. Everybody, this is APM.