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- [00:00]
Justin Ho
Invest Puerto Rico supports this Marketplace podcast. What's next in innovation? That's not the right question. It's where Puerto Rico more than just a tropical paradise, it's innovations paradise, where startups and global players coexist in a vast and vibrant ecosystem where talent runs deep, highly skilled and bilingual. Plus, the island offers the most competitive tax incentives in the US if you believe your business can go anywhere, Puerto Rico is the place. Find out more@investpr.org podcast.
- [00:34]
Kai Rysdal
On the program Today Inflation and the labor market and a cryptocurrency cautionary tale from American Public Media. This is Marketplace in Los Angeles. I'm Kai Rysdal. It is Tuesday today, the 10th of December. Good as always to have you along, everybody. If you are curious about where inflation in this economy stands and who among us is not, well, then this is the week for you. The Labor Department will be out with a new consumer price index tomorrow. The producer price index, that is wholesale inflation, comes Thursday, and the import price index is Friday. Meanwhile, the Labor Department also released some revised productivity numbers this morning. How much stuff we made compared to how much time we spent making it? Productivity increased 2.2% in the third quarter, pretty strong by historical standards. But another data point in there, something called unit labor costs, was revised lower as Marketplace's Justin Ho reports, to get us going. Those unit labor costs can tell us a whole lot about where inflation might be headed.
- [01:48]
Justin Ho
Think about unit labor costs as a ratio of how workers compensation compares to how productive they are. Put more simply, it's just a straightforward way to compare how much we're producing relative to how much it costs to produce that in labor terms. That's George Perks, macro strategist at Bespoke Investment Group. He says it's important to keep an eye on unit labor costs because if compensation is rising way faster than workers hourly output, what that means is workers have more cash to spend on goods and services, and businesses have to raise prices to account for that increase in labor costs. In other words, more inflation. Unit labor costs picked up a lot three years ago, back when labor was in really high demand and wages were spiking. But more recently, wage growth has generally been slowing across a number of measures. Skanda Amarnath is executive director of the research group Employ America. He says while wage growth has slowed down worker productivity, you know, output per hour has stayed strong. And so when productivity is growing strongly and wages are not growing quite as strongly as productivity, it will show up as unit labor costs slowing. And that means businesses have fewer reasons to raise prices Gerald Cohen is chief economist at the Kenan Institute of Private Enterprise at the University of North Carolina. He says labor costs are a huge part of what goes into making a good or providing a service. And if labor costs are slowing down while businesses are getting more productive, the cost of what you produce is growing more slowly. And that means, you know, you don't need to have big increases in prices to retain your profit margins. In fact, Cohen says unit labor costs are growing at a slower rate than inflation, which can help cool off prices even further. And that's kind of the holy grail of what we want. You have wage costs growing more slowly, and so prices can grow more slowly, and so you have downward pressure on inflation. And that could help the Federal Reserve finally bring inflation closer to its 2% target. I'm Justin Ho for Marketplace Wall street.
- [03:49]
Kai Rysdal
On day two of this trading week. Nope. We'll have the details when we do the numbers. There was news yesterday, a potential merger of advertising giants Omnicom and Interpublic Group. And how part of the draw of that deal is to better leverage new technology. Not actually spoken, but very much in the mix is artificial intelligence, which touches oh so many parts of the ad business these days, from idea formation to image generation. Marketplace's Kristen Schwab has that one.
- [04:42]
Justin Ho
Maybe you've seen this new holiday commercial from Coca Cola. It's a nostalgic take on the company's ad from the 90s, where red coca Cola trucks drive through snowy towns at night. Just the season. It's always the real thing, always the real thing. A little ironic since as many have pointed out online, the ad was made by AI. Phil Goran is with advertising company Dentsu. It a little bit missed the mark because it was kind of giving over the tools of creativity to the machine. The commercial has a high resolution, cartoonish touch. At one point, a polar bear appears to have two left paws. Goran says it just kind of takes the beauty out of it. As great as AI is, it can be a little bit formulaic. It's why, he says, for now, AI isn't often used to create full ads, but to clean up or create backgrounds. Scott Everett at ad agency PMG says they mostly use AI during the idea generation stage. It works wonders in helping us to rapidly pressure test ideas and visualize ideas to, say, figure out if the ad should take place at an airport or a train station. AI can make a quick mockup. That kind of power saves time, allowing one team member to do the work of a handful. But Everett says most companies are hesitant to create fully AI generated commercials because of copyrights, because AI is drawing on a knowledge base of content that has a roster of original creators creates. Some legal gray area brands are also worried about consumer backlash a la the Coca Cola commercial. Kartik Hosannegar directs the AI center at Wharton. If consumers know that a creative work or creative product is AI generated, their preference for such tends to be lower. If they know, Osonager says, soon I will be so good no one will recognize the difference. I'm Kristen Schwab for Marketplace.
- [06:59]
Kai Rysdal
As I speak these words 1 Bitcoin is going for a hair over 96 off its recent high, but testament to the reality that crypto has been on an absolute tear lately, in no small part because of President Elect Trump. Bitcoin is of course the og, but it is not the only cryptocurrency out there. Dogecoin has more than doubled since the election to the moon. In crypto speak three years ago, Marketplace's Matt Levin did a story about the Dogecoin millionaire, a guy who had bet his life savings on dogecoin and refused to sell at what was then its high. Turns out he's still riding the dogecoin roller coaster. And while the election has made him quite rich again, it could also cost him dearly.
- [07:44]
Justin Ho
Here's Matt More than three years ago, before he became a millionaire the first time around, Glaber Contessotto borrowed $1,500 from his aunt Christiani Almarez to invest in Dogecoin, and in return, he promised her a house when Doge shot to the moon. As of a couple weeks ago, when we recorded the Zoom conversation you're about to hear, Contesoto had $2.2 million in Doge, a cryptocurrency inspired by an Internet dog meme. He's planning to sell some in six to eight months, when he thinks the price will more than triple after Donald Trump takes office. And ultimately, at that point, I'll have $10 million. So with $10 million, even a million dollar house wouldn't really affect my finances that much. I don't need a million dollar house. You live in Maryland. You need a million dollar house. Almarez has about $5,000 in total savings. She's a housekeeper. Her husband's an Amazon driver. They have two kids. She wants Contesoto to sell right now because dogecoin is very unstable. So how can you guarantee that in six months you will do that? You know, because I'm based, I'm, I'm basing this off of patterns, right? Trends, patterns, charts, graphs. I do crypto full time. Time now. Right? I know, I know. I study this. You don't sleep. Look at your eyes. I know. Look. Part of Almarez's frustration is that she feels like she's seen this movie before. At one point in 2021, Contessotto had about $3 million in Doge and became a kind of crypto celebrity. Probably the most famous dogecoin evangelist not named Elon Musk. And then just a year later, all that buzz For Bitcoin and NFTs cooled and crypto winter settled in. The dogecoin millionaire became the Dogecoin former millionaire. I remember very vividly I was in the parking lot of the gym that I would go to, and I was sitting in the car watching it just plummet, right? And watching the amount in my Robinhood dump down all the way to 200 grand. But Kane Soto stuck with the meme coin that brought him here and even bought some more Doge and other crypto with what he had left. There are days where I think, oh, kind of wish I'd have sold. You know what I mean? But, like, ultimately, that's not where my heart was. And I'm very big on, like, just following my gut feelings on things. That gut ultimately proved right. Doge started rising in 2024. And then after the election, something kind of extraordinary happened. One of those glitches in the Matrix that makes you question whether you're living in a simulation. There we go. We have a statement in from the Trump staff, and I'll read this out. This is Fox News.
- [10:38]
Kai Rysdal
Trump says, I am pleased to announce.
- [10:40]
Justin Ho
That the great Elon Musk will lead the Department of Government Efficiency Doge. The Department of Government Efficiency Doge, an organization tasked with slashing the federal bureaucracy, which Musk had half jokingly proposed before the election. Mana from heaven for Dogecoin. Oh, my God. This is real. He's really gonna do this. He's really gonna be CEO of Doge. That's like branding. That's perfect. I couldn't have created that in a better way. Trump and his Department of Government Efficiency have been a huge financial boon for Contessotto. But there's another part of Trump's agenda that could be a major problem. I am currently undocumented as of right now. Yeah, I don't have papers. Conesotto came to the US From Brazil when he was five. His mother has a green card, but he's still trying to get legal status. I have conflicting emotions about Trump. You know, financially speaking, he's probably the best bet on the other side. You know, I could get a knock at the door next week and I'm deported, right? And everything I know just goes up in flames. When we were recording this, Conicero was actually in Brazil tending to a family emergency. He's unsure whether he'll even be allowed back into the US without his papers. So for the first time in years, he won't be having Christmas with Aunt Christiani in Maryland. For Christmas, whatever you want, you let me know. You make a wish list. Anything short of a house. I'm Matt Levin for Marketplace.
- [12:37]
Kai Rysdal
Coming up, they're gonna have to carry.
- [12:39]
Justin Ho
My dead body out of this house.
- [12:41]
Kai Rysdal
Gives a whole new meaning to no place like home, right? First though, let's do the numbers. Dow Industrials off 154 today. 4 10%. 44,247. The Nasdaq down 49 points a quarter percent. 19,687. The S&P 500 subtracted 17 points. 3 10%. 6,034. Oracle had a pretty bad day with shares down just under 7% after reported earnings per share, a penny behind analysts expectations. One penny. Microsoft down 6. 10%. Meta added 9. 10%. Designer Brands owner of DSW shoe stores reported earnings today. It said sales fell in the third quarter and reduced its outlook for the year. Nevertheless, designer brands up 3.8%. Go figure. You're listening to Marketplace.
- [13:35]
Justin Ho
Hi, this is Julie from Centennial, Colorado. I listen to Marketplace on my drive home from all my 3 to midnight ER shift. Kai and the gang keep me awake and int for my 30 minute drive. For someone not in the financial field, it's a fantastic synopsis of all things business and economics. I love the commitment to showcasing a steady stream of brilliant and articulate women who are experts in their field. Join me in supporting Marketplace with a gift today. Go to marketplace.org donate.
- [14:09]
Kai Rysdal
This is Marketplace. I'm Kai Rysdal. Justin Host started us off with a combo story on inflation and the labor market, those unit labor costs he was talking about. And we're going to stick with the labor theme here. Digging some data out from the November unemployment report that we got last Friday. More people the labor Department told us, are staying out of work for a longer period of time. Last month the number of people who are considered long term unemployed, that is to say out of a job and looking for one for at least 27 weeks, was about 1.7 million. 1.7 million people. That's a half million or so more people than than the same time a year ago. Being out of a job when you want one comes with all kinds of challenges, challenges that become more pronounced the longer you are looking for work. Marketplace's Stephanie Hughes has more.
- [14:57]
Justin Ho
Hillary Rosensteel's been looking for a full time job for about a year now. At the beginning she was super gung ho looking for nonprofit positions and so I did get some nibbles, but at the time they were only from areas outside of the state. And looking back, maybe I should have taken it. Rosenstiel lives in Maryland, which is where she was born. She's also a single mom and didn't want to move away, so she kept looking. But also life kind of happened. Her roof needed repairs, she had major dental work, and sometimes the job search had to go on the back burner. Some weeks I've applied for seven or 10 jobs and then some weeks, I mean, I hate to say it, but zero. Rosensteel's planning to deliver groceries for Instacart, and she's trying everything she can to speed up the job search. I guess I don't have to write a full soliloquy for every cover letter. Maybe I should try to. I don't know, maybe I should. I don't know what to do. Being unemployed for a long time can be kind of earth shaking for people, says Victor Chen. He's the author of Cut, Jobless and Hopeless in an Unfair Economy. You know, work is so central to our identity and so not having it leads to identity crisis that you feel, you know, what's my purpose, what's my meaning? Chen says long term unemployment can have major psychological effects comparable to going through a divorce or grieving, he says. It can also lead to what's called unemployment scarring. Employers won't consider you as seriously because they see you as, you know, damaged goods. You've been out of work for so long, there must be some reason that employers haven't picked you up. Also, the longer workers are away from work, the more they lose the ability to network and know what's going on, says Julia Pollack, chief economist at the hiring site ZipRecruiter. Being out of it for a while can be quite stigmatizing. All this can lead to a vicious cycle where people who have been unemployed stay unemployed, and then they're more likely to just fall out of the labor market. That's bad for them and the economy as a whole. I'm Stephanie Hughes for Marketplace.
- [17:15]
Kai Rysdal
There are two basic challenges as the automotive slice of this economy goes electric the first is getting people to buy EVs. We've talked a lot about that. And then there's the charging conundrum, which is basically an infrastructure challenge, getting enough public chargers out there to meet the growing demand. And on that score, there's a new technology coming that would take electric vehicle charging to the streets or to the street lights anyway. A company called Volt Post says that next year it's going to install about 100 lamp post EV chargers in New York, Illinois and Michigan. It's not going to be easy. There's coordination that's going to have to happen between Volt Post and public or private lamppost owners and utilities. And you can't really find Volt Post chargers in the wild yet. But Michigan Public's Laura Weber Davis did get a sneak preview.
- [18:03]
Justin Ho
The Volt Post charger is a nine foot cylinder that envelops a single lamp post. You scan a QR code to pay for the charge. The charge cord releases out from the box and you plug it into your car. When you're done charging, the cord spools back into the cylinder, kind of like a vacuum cleaner cord. But if I called it a vacuum cleaner cord, our product team would be very sad. That's Jeff Prosserman, the CEO of voltpost. He says it's cheaper and easier to install EV chargers where the electrical infrastructure already exists. And because of streetlights, there's this grid of wiring all laid out curbside. So people talk about opportunity charging, and this really provides the ability for people to charge where they are or meet them where they park today, like next to streetlights. But most lamp posts only have the capacity to accommodate a level 2 EV charger. That's what some EV owners would call a slow charger. Like, you only get a few dozen miles of range in an hour. Whereas fast chargers, level three chargers that you might find at like a big box store parking lot, well, those can get you full range in about a half hour. A lot of people are always talking about the speed of charging, fast charging, which ultimately is over indexed, I feel, in the media. Prosserman says installing fast chargers is cost prohibitive, which makes creating a vast network challenging. And he says most charging is actually done at home with level two slow chargers. But a charger at home can cost a couple thousand dollars. And about a third of all Americans live in apartments or condos where installing a charger isn't realistic. I personally do not have access to charging at home, and I love my ev. I don't ever plan to drive a Gas car again. That's Alexia Melendez Martineau with Plugin America, an electric vehicle advocacy group. She says she charges most often with level two chargers while she's out and about, picking up 20 miles of charge here, 40 miles there. We're used to fueling, you know, traditional gas cars where you kind of drive until you're empty and you fill up the tank when it until full. With EVs, the behavior changes so that you're plugging in, you know, little bits at a time because it is like an iPhone, right? That's Stephanie Valdez, streety at Cox Automotive. She says a big hurdle for the growing EV sector is that the public isn't accustomed to charging a car like a phone or a computer, like any kind of change management or changing it takes a long time. So I think it goes back to kind of this level two that you're talking about, you know, ensuring that there's a lot of level 2 charging. She says fast charging is important so that drivers feel like they can juice up quickly on long hauls. But she says there's also an important role to be filled with ubiquity in chargers, and that's where voltpost comes in. Jeff Proserman says think about how many electrical outlets are in the room that you're in right now, and the answer is probably that you don't know. And he's hoping EV chargers become just as common as we fast forward in the next five, 10 years, the plugs are just going to be everywhere, like maybe under the glow of your neighborhood streetlight in Detroit, I'm Laura Weber Davis for Marketplace.
- [21:43]
Kai Rysdal
As I think I said up at the top of the program, the latest read on inflation will be upon us tomorrow in the form of the November Consumer Price Index. Headlines and various and sundry details to come, of course, once we get the data. But over the past couple of months, years actually, what the Bureau of Labor Statistics calls shelter, inflation, has been especially high. In layman's terms, that means, among other things, that buying a home now is a whole lot more expensive than it used to be. Not news, I know, but even if you got in when prices were good, buying is one thing. Covering the taxes to live in said home, that can be a whole nother thing. Here's today's installment of our series, Adventures in Housing.
- [22:24]
Justin Ho
My name is Charlotte Kreutz. I live in Jersey City, New Jersey. My husband and I live in a 1877 Victorian home in downtown Jersey City. It's a row house. There are about eight of them. They're all four stories, some of them have been turned into apartments. Ours is one of the few that none of the details or anything have ever been touched. My husband Tom and I moved over to Jersey City in 1994 cause I was pregnant with my first kid. And we bought our first house in 1995 for $166,000. We could move in right away to most of the rooms. Some of the rooms down on the garden floor were in really bad shape. But the top apartment could be rented out for three people. It had basically three bedroom duplex and we started doing that right away. Cause of course now we had a mortgage and a kid on the way and we needed the extra Inc. After years of pretty simple easy living, I lost my job in 2018 and the property taxes skyrocketed. Jersey City had not done an assessment on Properties for 20 years. When we bought the house they were $8,000. They went up almost immediately to about $24,000. I had been thinking about doing an Airbnb, but all of a sudden it was critical to do an Airbnb because we needed a lot of money to keep paying the property taxes. So that's what I did. Both of my daughters had moved out, so that wasn't a big deal. I put up my notice for the Airbnb and sort of went, oh well, this will take a while to get going and hardly turned around. And all of a sudden there was bookings coming in and I was not prepared for that. Without the Airbnb covering our property taxes, we would probably have to move because we just couldn't afford to keep paying them. And then all the other things that an old Victorian problems that it has, like, you know, the boiler finally giving out or the windows letting in so much air that we've got to replace them. It's such a cliche, but you know, they're going to have to carry my dead body out of this house. I just don't want to move away and I think we can do it. It's just a question of how long we last.
- [25:20]
Kai Rysdal
Charlotte Cruiz in Jersey City, New Jersey Whether you are in your forever home or or you plan to move to someplace new, tell us about your journey in housing, won't you@marketplace.org Adventures in Housing. This final note on the way out today. None o my business, I know, but how do you feel about your job and related. How do you feel about your pay? I'm asking because there's a new survey out from Pew on exactly those two topics. It turns out that we, that is American workers, we like our jobs. 88% of us are either extremely or very satisfied with what we do for a living. Nearly a third of us, though, are either not too satisfied or not at all satisfied with our pay.
- [26:15]
Justin Ho
Hmm.
- [26:16]
Kai Rysdal
Our Digital and On Demand team includes Kerry Barber, Jordan Manji, Dylan Mientanen, Janet Wynn, Olga Oxman, Ellen Rolfus, Virginia K. Smith, and Tony Wagner. Francesca Levy is the executive director of Digital and On Demand. And I'm Kai Rysdal. We will see you tomorrow. Everybody, this is apm.
- [26:45]
Justin Ho
Hi, this is Michael from Sinking Spring, Pennsylvania. Marketplace is both enjoyable and extremely informative.
- [26:53]
Kai Rysdal
Kai and the reporters go out to.
- [26:55]
Justin Ho
All kinds of people in the community and they ask straight ahead questions like, how are you holding up these days? It's very personal and as we listen, we get a good sense of the.
- [27:05]
Kai Rysdal
Challenges people face as they are trying.
- [27:07]
Justin Ho
To make it from day to day. I listen to the Marketplace podcasts every day and have been doing so for.
- [27:14]
Kai Rysdal
A number of years. It's a breath of fresh air that.
- [27:17]
Justin Ho
Helps me understand the economic world better. Join me by making a gift to marketplace@marketplace.org donate.