The law of unintended consequences

Summary

Marketplace: The Law of Unintended Consequences

Marketplace, hosted by Kai Ryssdal, delves into the complex and often unforeseen repercussions of economic policies and business decisions. In the March 26, 2025 episode titled "The Law of Unintended Consequences," Ryssdal explores how seemingly straightforward economic tools, such as tariffs, can ripple through various sectors, affecting everything from government borrowing to small businesses and higher education funding.

1. The Trade Deficit and Tariffs: A Double-Edged Sword

Kai Ryssdal opens the discussion by addressing the persistent topic of tariffs, a favored tool of the U.S. President aimed at shrinking the trade deficit and encouraging Americans to purchase domestic goods. Ryssdal remarks, "...allow me to introduce you here to the law of unintended consequences" [00:00].

Sabri Benishore likens economic interventions to a scene from The Simpsons, illustrating how tampering with one aspect can inadvertently disrupt the entire system [01:48]. Mary Lovely, a senior fellow at the Peterson Institute for International Economics, explains the trade deficit as "more money going out of the house than coming in" [02:24]. She emphasizes that without a mechanism to recycle these dollars back into the economy, the balance would tip disastrously.

Matthew Slaughter, Dean of Dartmouth's Tuck School of Business, adds that these outgoing dollars return as U.S. assets, such as stocks and treasury securities [02:59]. However, Sabri Benishore warns, "If the trade deficit were magically smaller... fewer loans to business, fewer loans to the government" [03:08], suggesting that reducing the deficit without addressing government borrowing needs could stifle economic growth.

Robert Lawrence of Harvard underscores the complexity by noting that a smaller trade deficit means reduced borrowing from abroad, but with the federal government unlikely to borrow less, "someone else is going to have to borrow less, and that would be the rest of the economy" [03:35]. This scenario, Benishore posits, could lead to a recession as businesses and consumers pull back [03:58].

2. Beyond the Official Unemployment Rate: The Hidden Struggles

The conversation shifts to the nuances of unemployment statistics. Ryssdal points out that the official unemployment rate, U3, is just one of six measures [04:14]. Mitchell Hartman introduces Aurora Asbill's story, a theater professional facing inconsistent work hours [05:30], highlighting the limitations of traditional unemployment metrics.

Victoria Gregory, a labor economist at the St. Louis Fed, breaks down the unemployment rates from U1 to U6, elucidating how each captures different facets of labor underutilization [06:07]. She explains that U6, the broadest measure, includes discouraged workers and the underemployed [07:27].

Gary Hoover from Tulane emphasizes his concern with U6, describing marginalized workers as "the canary in the coal mine" [08:57], signaling deeper economic distress [09:07]. This broader perspective suggests that rising unemployment rates, especially among the least advantaged, indicate a slowing economy with potentially tougher times ahead [09:14].

3. Higher Education Funding: Endowments Cannot Fill the Gap

Elizabeth Popp Berman, a professor of organizational studies at the University of Michigan, addresses the misconception that university endowments can easily replace federal funding cuts [10:20]. Ryssdal challenges the notion that large endowments, such as Michigan's $19 billion, are fungible [10:26], to which Berman responds:

"The first thing to know about endowments is that they are actually tens of thousands of little specific funds... you can't really just retire on that and support yourself and you really want to work full time." [11:05-12:00]

Berman explains that endowments are often earmarked for specific purposes and cannot be redirected to cover general funding shortfalls. She highlights the disparity between institutions with substantial endowments and those with minimal or none, leading to increased inequality within higher education [14:18].

When asked about potential solutions, Berman suggests that while an endowment tax could address inequalities, current proposals risk disproportionately benefiting already wealthy institutions [15:22]. She warns that without federal funding, universities may face significant downsizing, hindering their global competitiveness and halting critical research [15:37].

4. Small Businesses Under Pressure: Rising Costs and Uncertainty

The episode transitions to the struggles of small businesses in an uncertain economic climate. Rene Hidalgo, owner of Don Pepe Mexican Restaurant in Houston, shares his experience of raising prices to cope with rising costs:

"I have no option. We have to pay for employees, all bills, rent, electricity bills and all that." [21:08]

Janessa Perney, owner of Erskine's Grain and Garden in Vermont, recounts how tariffs directly increased her costs:

"I paid 20% extra. They swallowed 5% for me." [21:41]

Tom Sullivan from the Chamber of Commerce highlights a surge in business owners concerned about future revenues, linking this anxiety to halted growth plans [21:54-22:02]. The discussion underscores how tariffs and rising operational costs are forcing small businesses to either absorb losses or tighten their operations, often at the expense of employees and expansion [22:13-22:43].

5. Global Ripples: China's Struggling Restaurant Industry

Ryssdal broadens the scope to international impacts, particularly in China, where trade frictions and declining consumer confidence have severely affected the restaurant industry. Jennifer Pak reports on the collapse of the Camel Hospitality Group, whose sudden closure left employees unpaid and businesses shuttered [23:09-24:55].

Bryce Jenner, a former owner of multiple restaurants, notes that diminishing consumer spending, exacerbated by real estate market downturns and increased costs, has led to thin profit margins:

"People aren't buying the drinks and they're not buying the extra appetizer." [27:35-27:36]

This decline is attributed to a real estate slump that has eroded consumer wealth, prompting tighter spending on non-essential dining [25:22-25:58]. The narrative paints a bleak picture of how economic policies and market fluctuations can devastate industries far beyond their initial intent.

6. Concluding Data Points: Indicators of Economic Strain

In closing, Ryssdal presents key data points signaling broader economic challenges:

• Car Repossessions: Up 16% in 2024 compared to the previous year, the highest since the Great Recession [28:15].
• Student Loan Delinquencies: Nearly 10.1 million borrowers are past due following extended payment pauses [28:15].

These statistics reinforce the episode's theme of widespread economic strain affecting various aspects of daily life and long-term financial stability.

Final Thoughts

"The Law of Unintended Consequences" episode of Marketplace masterfully illustrates how economic policies, intended to solve specific issues, can lead to complex and far-reaching impacts. From government borrowing and unemployment nuances to the financial struggles of universities and small businesses, the episode underscores the interconnectedness of economic factors and the importance of considering potential ripple effects in policy-making.

Notable Quotes:

• "The government does not look like it is about to borrow less." — Victoria Gregory [03:35]
• "People aren't buying the drinks and they're not buying the extra appetizer." — Bryce Jenner [27:35]

This comprehensive exploration serves as a reminder that in economics, every action can lead to multiple, often unforeseen, outcomes, embodying the true essence of the law of unintended consequences.

Transcript

[Kai Rysdal]

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[Sabri Benishore]

There was the Simpsons episode where Homer traveled back in time to the edge of the dinosaurs.

[Henry Epp]

As long as I stand perfectly still.

[Kai Rysdal]

And don't touch anything, I won't destroy the future.

[Sabri Benishore]

He obviously touches something, kills a bug and messes up the future, which he finds out when he gets back.

[Kai Rysdal]

Don't you remember, dad? Flanders is the unquestioned lord and master of the world.

[Mitchell Hartman]

Don't.

[Sabri Benishore]

Economics is sometimes a little bit like that. You mess with one thing and something else gets messed up. Take the trade deficit. The US Imports more than it exports. Mary Lovely is a senior fellow at the Peterson Institute for International Economics, which is a marketplace underwriter.

[Kai Rysdal]

Okay, so the trade deficit reflects the.

[Elizabeth Popp Berman]

Difference between U.S. income and U.S. consumption.

[Sabri Benishore]

More money going out of the house than coming in. We're all just shooting dollars out the door to TEMU every day. Now, if that was all that was going on decade after decade, we would have no money and the world would have just dollars piling up worth nothing. That is not happening because those dollars that we send out into the world, they do not stay there. They come back.

[Kai Rysdal]

They're used to buy American assets.

[Sabri Benishore]

Matt Slaughter is dean of Dartmouth's Tuck school of business.

[Kai Rysdal]

U.S. stocks, they're used to purchasing maybe U.S. corporate debt. They're definitely purchasing U.S. treasury securities.

[Sabri Benishore]

Now let's imagine that the trade deficit were magically smaller. We're sending fewer dollars out the door, so fewer dollars are coming back in the door. And as investments, fewer loans to business, fewer loans to the government.

[Kai Rysdal]

If foreigners are buying fewer American assets, either the federal government has to borrow less or the private sector.

[Sabri Benishore]

Robert Lawrence is professor of international trade and investment at Harvard. A world with a smaller trade deficit is a world where this country is borrowing less because there's fewer dollars coming in because there's fewer dollars going out. There's just one problem. The government does not look like it is about to borrow less. MARY Lovely again.

[Victoria Gregory]

You know, all forecasts are they're going.

[Kai Rysdal]

To increase the federal budget deficit.

[Sabri Benishore]

So if the government isn't borrowing less and the trade deficit's supposed to go down, that means someone else is going to have to borrow less, and that would be the rest of the economy. You know what could make the economy borrow and buy a lot less? A recession In New York, I'm Sabri Benishore for Marketplace.

[Kai Rysdal]

On Wall street today, tariffs, Even the whisper of them, a hint, the merest mention was enough to send traders scurrying. We will have the details when we do. The number we're going to get come Friday next, the employment situation summary for March. We're going to put it, I'd imagine, right up at the top of the show. And you're going to hear me say something like the unemployment rate last month was whatever it was, which is fine as far as it goes. But the thing is the Bureau of Labor Statistics actually publishes six unemployment rates in total, each of which measures a different bit of what economists call labor underutilization, basically, workers not working. And those rates right now range from 1.5%, a percent and a half up to 8% marketplace. Mitchell Hartman has the rest of that story.

[Mitchell Hartman]

Aurora Asbill is 25, from Dayton, Ohio. Theater is her passion and profession.

[Victoria Gregory]

I build costumes.

[Mitchell Hartman]

She moved to New York City two years ago with a theater tech degree and eventually landed a job in a shop making costumes for movies and Broadway shows.

[Victoria Gregory]

While I had like a 9 to 5. If Broadway is not doing any cast changes, nothing's opening hours get cut. I would walk in in the morning, my boss would be like, sorry girl, like we don't have any work for you. Like you can go home. Maybe I'll see you in two weeks.

[Mitchell Hartman]

When this happened, she'd try to find short term freelance gigs to tide her over.

[Victoria Gregory]

You can't really fall back on, oh well, I'll just file for unemployment. You're constantly looking for work.

[Mitchell Hartman]

She had a job, though she sometimes didn't get any hours or a paycheck. She did temp jobs, but it didn't pay the bills and she was aggressively looking for a new job. So would Asbill be counted in the monthly jobs report as unemployed, underemployed? It's actually not an easy answer. Victoria Gregory is a labor economist at the St. Louis Fed. She says each of the unemployment rates the Bureau of Labor statistics publishes labeled U1 through U6, tries to get at a different slice of people who tell the survey takers they want to work but aren't working, or aren't working as much as they want to.

[Victoria Gregory]

Going from now is to broadest, U1 is just capturing the long term unemployed for 15 weeks or longer, which is a lot longer than the typical unemployment spell, she says.

[Mitchell Hartman]

That matters because the longer folks are unemployed, the less likely they'll get another job soon. Next U2.

[Victoria Gregory]

This starts to add in job losers because of a layoff or a firing or their temporary job ending.

[Mitchell Hartman]

And that might be the unemployment category. Aurora Asbill would fall under a temporary layoff or Perhaps the next one, U3, when she gave up on the first job and started looking for a new one.

[Victoria Gregory]

U3 is the official rate, the simplest notion of unemployment. It just captures people who want a job and have actively been searching for one within the last four weeks.

[Mitchell Hartman]

And that official rate has its virtues, says Harvard economist Lawrence Katz.

[Kai Rysdal]

We've been collecting it the same way for like 80 years. It's comparable over time. It's comparable internationally. But he says it's not everybody facing distress in the labor market.

[Mitchell Hartman]

This has been a long standing criticism that the official rate is an undercount.

[Kai Rysdal]

It doesn't count you if you're so discouraged you're not doing something. Active, defined work if you work 10 hours a week, but that's not enough to support yourself and you really want to work full time.

[Mitchell Hartman]

In recent decades, BLS has added more measures of unemployment. The broadest U6 includes discouraged workers, the marginally attached who want work but haven't looked recently, and involuntary part time workers, also called the underemployed Rebecca Dixon at the National Employment Law project follows the U6 closely.

[Victoria Gregory]

7.5% in January, bumped up to 8% in February. Seeing that increase is an example of the labor market slowing down.

[Sabri Benishore]

I'm always much more concerned with the U6.

[Mitchell Hartman]

Tulane economist Gary Hoover.

[Sabri Benishore]

What's happening with marginalized workers on the periphery of the economy? Those will be the ones most quickly dismissed.

[Mitchell Hartman]

They're the workers with the least education and experience. More likely to be women and minorities, last hired and first fired in a downturn. Hoover calls it the canary in the.

[Sabri Benishore]

Coal mine, the harbinger of things to come. And it'll probably show up later on in the U3.

[Mitchell Hartman]

These unemployment rates edging up recently suggests that the economy is starting to perform less well, especially for the least advantaged workers. And given rampant economic uncertainty and rising hesitancy by businesses to hire, it could be a sign of worse times to come. I'm Mitchell Hartman for Marketplace.

[Kai Rysdal]

Universities are among the highest profile targets of the spending cuts being engineered by Elon Musk and his operatives. And the temptation here is to say, come on, universities have plenty of money, especially the ones with nine figure or more endowments. Well, maybe not. Elizabeth Popp Berman is a professor of organizational studies at the University of Michigan, also the author of a post entitled, no University Endowments Can't Replace Federal Science Funding. Professor Berman, welcome to the program. Good to have you on.

[Victoria Gregory]

Thanks for having me.

[Kai Rysdal]

So I guess we start at the very beginning here, which is endowments. What are they? Because contrary to popular opinion, they are not just a giant pool of money.

[Victoria Gregory]

Right. The first thing to know about endowments is that they are actually tens of thousands of little specific funds. So when a donor gives money to the university, they give it with some specific intent in mind. So maybe it's for a particular kind of cancer research, or maybe it is for a particular scholarship. And then the university agrees to hold that money and is allowed to spend the interest on it effectively on those specific things.

[Kai Rysdal]

So a dollar is not a dollar is not a dollar. Right. They can't sort of replace that with something else. They just. They got to do that.

[Victoria Gregory]

Exactly. And that's oversimplifying a little, but that's what most of the endowment actually is.

[Kai Rysdal]

Okay, so to the matter at hand. Federal funding gets cut, as is happening now, and chances are it's gonna happen more in the future. The point of this post is that university endowments cannot make up the difference. And the question then has to be why?

[Victoria Gregory]

Yeah, I think there's a couple of reasons really first, they're just not that large relative to the amount of money that the government contributes to universities. You know, most recently we've seen Columbia had 400 million immediately pulled from it, but the administration said they had $5 billion in contracts outstanding. That could be p. Right. So even though Columbia's got a $15 billion endowment, much of which it legally can't spend anyway, it can't cover something like that on more than a one time basis.

[Kai Rysdal]

The other thing you point out in this post is that, and I think you cite the University of Michigan, your university specifically, it's got like a 19ish billion dollar endowment, but it's tens of thousands of students with huge obligations. And so on a per student basis you can't get there from here.

[Victoria Gregory]

Yeah, and I think that's another thing too is that it's easy to forget just how large these institutions actually are. So the University of Michigan has an annual budget of something around 13, $14 billion. So again, if you sort of translate this into the kinds of terms of kind of a ordinary family. Right. If you make $100,000 and you have about that much in savings, it's not like you can really just retire on that and support yourself.

[Kai Rysdal]

We've all heard of, and I actually have friends in academia who pointed out that PhD enrollments are being put on hold, if not completely rolled back. What are you seeing in Ann Arbor? And the point to make here clearly is that you don't speak for the your experience.

[Victoria Gregory]

Sure. I mean, I think what you see right now is that research programs are being cut. Lines of work that I think most people in the public would be generally very supportive of. You know, we do, we have a huge medical center that does tons of cancer research, for example. Those programs are just kind of grinding to a halt. And so, you know, the university is doing a lot to try to backstop that in the short run. But right now they've said they're going to be able to backstop about maybe six months to kind of give people some time to transition. But there's no long term solution to federal funds going away.

[Kai Rysdal]

With the acknowledgment here that you are an academician and not a tax policy specialist, there is on the table certainly in Washington, Vice President Vance has said he wants to tax university endowments at something like 35%. And they are now, if not tax free, then much lower levels of taxation. What do you think of that?

[Victoria Gregory]

Yeah, I mean, I think it's complicated because I do think that it's A problem for the sector that there's so much inequality between very wealthy institutions with large endowments and the majority, a large majority of colleges and universities that have almost no endowment to speak of. So I might support an endowment tax that was going to help fund underfunded parts of higher education. But I think right now what we're looking at really is a potential endowment tax that is essentially going to fund tax cuts for the well off.

[Kai Rysdal]

You mentioned inequality there. It should be pointed out that There are like 20 institutions of higher learning in this country with 20 plus billion dollar endowments and they get all the intention. But most schools have way less, if any. Right. And I guess the point is these endowments do contribute to inequality.

[Victoria Gregory]

Yeah. And I think that's really important to remember is that when we read the news, we're really reading about the same hand of five or 10 or 20 institutions that do have these large endowments. But most colleges are not in this position. You know, your regular regional university down the street that enrolls a lot of students in your community does not have an endowment that's contributing in any significant way to its bottom line. And rising endowments have kind of contributed to that inequality, but, you know, as part of a larger story.

[Kai Rysdal]

All right, so look, here comes the put up or shut up question. If federal funding is really going away, which certainly seems to be the case, and endowments can't make up the difference, as you lay out in this post, now what do we do?

[Victoria Gregory]

I mean, I think if federal funds truly go away, universities will still exist, but they will just be smaller. They will not be globally competitive. And a lot of really important work that has been getting done will no longer happen.

[Kai Rysdal]

Elizabeth Pop Berman is a professor of organizational studies at the University of Michigan. Professor, thanks for your time. I appreciate it.

[Victoria Gregory]

Thank you.

[Kai Rysdal]

Coming up, people aren't buying the drinks and they're not buying the extra appetizer. They're not buying that bowl of soup. You know, a side order a day could keep the restaurant closures away. First though, let's do the numbers. Dow industrials down 132 points today. About 3. 10% landed at 42,454 did the blue chips. The NASDAQ down 372 points. 2%. 17,000 eight. Eight niner. The S&P 500 gave back 64 points. One and a tenth percent. 57 and 12. GameStop jumped more than 11% a day after its board said it would use some of its corporate cash to invest in Bitcoin. Huh. The video game seller also announced plans to close what it described as a significant, significant number of its stores this year. Other meme stocks, you say? Sure. Crypto miner AGM holdings jumped 12.1 10% today. Private jet charter firm Jet AI gave back 2.8%. Bonds down yield on the 10 year t note rose 4.35%. You're listening to Marketplace.

[Victoria Gregory]

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[Kai Rysdal]

This is Marketplace. I'm Kai Rysdal. Consumers in this economy just are not feeling so good right now. We talked about that yesterday. Mitchell did the story for us. Turns out small businesses are kind of down in the dumps, too. The MetLife Chamber of Commerce Small Business Index slid nearly 7 points over the past quarter, wiping out its gains since Election Day. To be clear, small business owners do still think the economy's on pretty solid ground, but they're feeling. What's that word again? Oh, yeah, uncertain. Here's Marketplace's Henry Epp.

[H]

It's been a quiet march for Rene Hidalgo, owner of Don Pepe Mexican restaurant in Houston. And he thinks that has a lot to do with the fact that he raised his prices this year because his costs keep going up.

[Kai Rysdal]

Sometimes people comment, well, that's a little too much for a breakfast taco or breakfast plate, but I have no option. You know, we have to pay for employees, you know, all, all bills, rent of electricity bills and all that, and.

[H]

Rising food costs, especially eggs. Instead of raising prices, some business owners are just taking the hit. Janessa Perney owns Erskine's Grain and Garden, a farm supply store in Chester, Vermont. She recently ordered wood shavings for animal bedding from Canada, and her supplier crossed the border right before President Trump rescinded 25% tariffs.

[Victoria Gregory]

I paid 20% extra. They swallowed 5% for me. So that kind of thing is really disconcerting. Thinking about those types of things are making it hard to plan cash flow.

[H]

The U.S. chamber of Commerce survey found a sharp uptick in business owners who feel concerned about their future revenue. Tom Sullivan is with the Chamber.

[Kai Rysdal]

We know that that revenue, depending on how much of a chunk is taken out from inflation, is really what is going to result in growth, stability or decline.

[H]

It'll determine, he says, whether businesses feel like they can hire more workers or make capital investments. But right now, what he's seeing are.

[Kai Rysdal]

Small business owners hitting the pause button on, on growth plans for 2026 and beyond.

[H]

In Houston, Rene Hidalgo hopes business picks up in the next few months because right now he's at the front counter seven days a week and I'm working.

[Kai Rysdal]

Here since opening the morning till closing because I cannot afford to have another person, you know, like a manager or something.

[H]

If business picked up, Hidalgo could hire someone to help out and take some time off. I'm Henry Epp for Marketplace.

[Kai Rysdal]

Henry was just talking about business uncertainty. Believe me when I tell you it's not just happening here. President Trump's trade and other policies are rattling the global economy too, and nowhere more than in China, where those trade frictions and their own consumer confidence issues are weighing on things consumer discretionary spending, in particular a category called food away from home. Most specifically restaurant profits in Beijing last year. This is from municipal data down more than 80%. The cause and effect connection here is that a lot of restaurants are closing, sometimes all of a sudden. Marketplace's Jennifer Pak has more now from Shanghai.

[Henry Epp]

If you came to Shanghai late last year and asked where you could have a nice, not too expensive brunch with free flowing alcohol, a popular choice would have been the bowl and Claw, housed.

[Victoria Gregory]

In a beautiful villa style lane house, three floors, so that's a lot of overhead.

[Henry Epp]

Rachel Kwok writes a Shanghai based food and drink blog called nomfluence. She says the Bull and Claw was part of a handful of restaurants and gyms owned by the Australian firm Camel Hospitality Group, which was established in 2010 when times were good.

[Victoria Gregory]

They were printing money back in the.

[Henry Epp]

Day, like a lot of sectors. Fast forward to last November when Camel group sent a WeChat message to all its staff. One of them was graphics designer Joan Dai.

[Victoria Gregory]

The document said that the company had dissolved and every employee's contract had been terminated. It said our salaries would be prioritized as soon as the company's bankruptcy liquidation was complete. Then the boss disappeared and he hasn't answered our calls since. He just ghosted us.

[Kai Rysdal]

The number you have dialed is not in service.

[Henry Epp]

I also tried without luck to reach former bosses at Camel Hospitality for comment. I did get one of the vendors it owes money to. Luckily not a lot, says Maria, who supplies alcohol to restaurants. We're not using her full name because she worries about official retaliation for speaking about the economy in less than glowing terms.

[Victoria Gregory]

I think it's extremely hard to get people to dine out right now, she says.

[Henry Epp]

That's because of China's real estate slump. People here invest most, if not all of their savings in property, which Used to be a safe bet until the market dropped. So when real estate has started to sort of hit this brick wall, a lot of people have seen their main assets decrease quite a lot and therefore they're tightening their purse strings. Meantime, Ren's labor costs and Social Security taxes are all going up, says Bostonian Scott Manoy. He opened a popular restaurant chain in China called Element Fresh that serves sandwiches, salads and smoothies. For a decade, all went well, but.

[Sabri Benishore]

Then we started to see per restaurant profit level decline because simply revenue would go up by 5%, costs go up by 15, 20% year on year.

[Henry Epp]

Restaurateur Bryce Jenner once ran seven sports bars and restaurants. Now just one is left. His Mexican food outlet, Pistolera. He says the beginning of the end for his business came in 2018 when Chinese leader Xi Jinping got rid of the two term limit on the presidency, shaking consumer confidence.

[Kai Rysdal]

The optimism went.

[Henry Epp]

Then came the COVID lockdowns. Foreigners, key customers for Jenner and the Camel Group left China. Jenner says he's friends with the Camel Group owners and the last time they met was over a year ago to discuss what they should do in the downtown downturn.

[Kai Rysdal]

No, I said, hey, maybe we should fight this together.

[Sabri Benishore]

And they said, yeah, I don't know.

[Kai Rysdal]

And we all sat there pretty sad.

[Henry Epp]

In the end, Jenner sold off parts of his business, closed others. But even downsizing costs money. See, in China, companies legally need to pay severance to their workers. Again, Bostonian entrepreneur Scott Manoy.

[Sabri Benishore]

And if we let everybody go, that we should let go so that we can cut down on payroll, well, we'll be in the red immediately with the severance payment. So you kind of hang on one more month, two more months, three more months, eventually you run out of cash, and that's what happened to us.

[Henry Epp]

He quit the business three years before his Element Fresh chain officially closed in 2021. Today, some of the more established restaurants are still packed, says Bryce Jenner, Though just one of his seven restaurants and bars has survived.

[Sabri Benishore]

But you know, people aren't buying the.

[Kai Rysdal]

Drinks and they're not buying the extra appetizer. They're not buying that bowl of sou.

[Henry Epp]

Buying the coffees, items that can increase the tab by 30, 40%, he says. And until China's overall economy improves, restaurant profits will likely be very thin. In Shanghai. I'm Jennifer Pack for Marketplace.

[Kai Rysdal]

This final note. On the way out today, a couple of quick where things stand data points. Saw this first one in the Wall Street Journal data from Cox Automotive. That car repossessions in 2024 were up 16% from a year earlier. That's the highest level they've hit since 2009 and the great recession also and related this one is from the Federal Reserve bank of New York that almost 1010 million people are past due on their student loans since the pandemic payment pause. An additional grace period extended rather last September. Our media production team includes Brian Allison, Jake Cherry, Justin Dueler, Drew Jostat, Gary O'Keefe, Charlton Thorpe, one college tirado, and Becca Weinman. Jeff Peters is the manager of media production and I'm Kai Rysdal. We will see you tomorrow, everybody. This is apn.

[Sabri Benishore]

If there's one thing we know about social media, it's that misinformation is everywhere, especially when it comes to personal finance.

[Kai Rysdal]

Financially Inclined from Marketplace is a podcast.

[Sabri Benishore]

You can trust to help you get.

[Kai Rysdal]

Serious about your money so you can build a life you've always dreamed of.

[Sabri Benishore]

I'm the host, Janelie Espinal, and each.

[Kai Rysdal]

Week I ask experts important money questions, like how to negotiate job offers, how to choose a college that you can afford, and how to talk about money with friends and family. Listen to Financially Inclined wherever you get your podcasts.