Marketplace: "Uncertainty is a Certainty" – Episode Summary

Date of Release: March 6, 2025
Host: Kai Ryssdal
Podcast: Marketplace
Description: Every weekday, host Kai Ryssdal helps you 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. Our team of reporters all over the world speak with CEOs, policymakers, and regular people just trying to get by.

1. Disbanding of Federal Economic Advisory Committees

Timestamp: 00:01 – 03:17

Kai Ryssdal opens the episode by addressing a significant change in the federal economic landscape: the Commerce Department has disbanded two longstanding advisory committees—the Federal Economic Statistics Advisory Committee and the Bureau of Economic Analysis Advisory Committee. These committees have historically played a crucial role in ensuring the accuracy and transparency of government economic data, which is essential for understanding economic trends and informing business and policy decisions.

Kailey Wells reports on the unexpected disbandment, quoting Erica Groschen, a former committee member, who stated, “[This] came out of the blue” (01:18). April Hemmes adds, “Nothing up until I got the email” (01:22), highlighting the sudden nature of the decision.

Former committee chairs David Wilcox and Louise Shaner express concerns over the loss of expert advice and government transparency. Shaner warns, “With less input, the data that the government gathers will get worse over time” (02:38), emphasizing the potential long-term impacts on economic data quality.

Susan Wachter, a professor of real estate and finance, underscores the importance of reliable data: “And if the data are not good, your answers to those questions are also not going to be good” (02:55). The elimination of these committees is seen as a setback for maintaining robust economic statistics.

2. Impact of Tariffs on Farmers and the Economy

Timestamp: 03:17 – 09:39

Ryssdal transitions to the topic of tariffs, focusing on the recent partial reprieve granted by President Trump on tariffs for cars and trucks from Canada and Mexico, albeit only for a month. While this decision benefits major automotive manufacturers like Ford, GM, and Stellantis, it poses challenges for American farmers who still face tariffs from Mexico, Canada, and looming tariffs on Chinese exports.

He interviews April Hemmes, a corn and soybean farmer in Iowa, who shares her apprehensions: “His definition of fun is way different than the farmer's definition because tariffs are not fun” (04:47). Hemmes elaborates on the broader impacts, noting, “We in the ag community are worse off now because the interest rates are higher than they were before and our cost of production's way up” (05:27).

The discussion highlights the struggle farmers face in adapting to new tariffs, with Hemmes expressing doubt about the sustainability of domestic markets: “You don't build those markets domestically overnight... it's not going to happen overnight” (06:11). The potential shutdown of the Soybean Innovation Lab at the University of Illinois exacerbates concerns about governmental support for agricultural markets.

Hemmes remains resilient, asserting her commitment: “This is my 40th year farming... this farm will go through more. But I'll still be here” (08:13), illustrating the determination of farmers amidst economic uncertainties.

3. 10-Year Treasury Yield: Good News and Bad News

Timestamp: 10:00 – 13:15

Ryssdal provides an update on the 10-year Treasury yield, a key economic indicator that influences everything from mortgage rates to business investments. He notes a significant drop of over half a percentage point since mid-January, reaching 4.28% (10:32).

Nicole Survey, an economist with Wells Fargo, explains the immediate positive impact: “Mortgage rates are declining substantially” (10:46). However, Ryssdal cautions that the reasons behind the decline may signal underlying economic weaknesses. Blarina Urucci, chief U.S. economist at T. Rowe Price, adds, “One of the factors driving it lower is this growing uncertainty about the outlook for growth” (11:35).

Susan Wachter further elaborates, “Lower, slower growth expectations mean that the Fed can cut or might be forced to cut interest rates down the road” (12:23). Thus, while lower yields can make borrowing cheaper, they also reflect concerns about economic slowdown and reduced growth prospects.

4. Conflicting Reports in the Services Sector

Timestamp: 14:00 – 17:12

The episode delves into contradictory reports about the services sector, with two prominent surveys presenting differing views. The Institute for Supply Management (ISM) reports growth, while S&P Global depicts a worrying decline.

Daniel Ackerman explains the discrepancy by pointing out differences in survey respondents and timing. Steve Miller of ISM mentions, “It's some healthy, healthy improvement” (15:37), whereas Chris Williamson of S&P Global notes, “It’s now reporting the weakest output growth since November 2023” (15:45).

Gary Schlossberg of Wells Fargo Investment Institute suggests that the ISM survey primarily targets high-level executives, while S&P Global includes shop floor responses, providing a more ground-level perspective. Additionally, the ISM survey allowed responses throughout February, capturing a more optimistic early-month sentiment, whereas S&P Global's survey was conducted late February, amid dropping markets and looming tariffs (16:11).

5. Labor Market Concerns and Rising Unemployment

Timestamp: 17:12 – 19:18

Ryssdal shifts focus to the labor market, anticipating a sobering jobs report on Friday. Recent data shows rising unemployment claims and slowing private sector hiring. Susan Wachter voices skepticism about an optimistic jobs report: “I’m not expecting a rosy jobs report” (17:38).

Michelle Evermore from the National Academy of Social Insurance highlights increasing difficulty for unemployed individuals to find new jobs: “That number has been rising, which indicates it's getting harder for people who get laid off to find jobs” (18:13). This softening is partly attributed to the Federal Reserve’s interest rate hikes aimed at controlling inflation, which have inadvertently dampened job growth (18:18).

The overarching theme is uncertainty within the labor market, exacerbated by fluctuating policies and economic conditions. Nicole Survey remarks, “We don’t exactly know even when policies are implemented, exactly how they're going to be implemented” (18:45), underscoring the challenging environment for both employers and employees.

6. Entrepreneurs Adapting in the Post-Pandemic Economy

Timestamp: 19:37 – 24:16

The podcast explores the entrepreneurial landscape five years post-pandemic, highlighting innovative business models adapting to current economic realities. Justin Ho introduces several entrepreneurs who have pivoted to more sustainable and flexible operations.

• Deepak Di Pachakibo operates a mobile coffee van in Ojai, California, emphasizing work-life balance and lower overhead costs: “I could order just what I need rather than things in bulk” (21:31).

• Jordan Anthony Brown runs The Aperture, a sit-down restaurant in Cincinnati, which has increased prices to cover rising costs while focusing on a fine dining experience to attract disposable-income customers: “Happy employees make for, you know, happy guests” (21:41).

• Sean Steigerwald founded Customer IQ, a software company leveraging AI to streamline business communications, addressing the ongoing demand for efficient virtual interactions.

• Aria Jochen established Makewith Hardware and Learning Center in Portland, Oregon, offering DIY workshops to empower individuals with practical skills amidst economic pressures: “If the business goes well, one day we hope to expand by opening a hardware store” (23:41).

These stories illustrate resilience and adaptation, with entrepreneurs finding niche markets and innovative solutions to thrive despite economic uncertainties.

7. Final Notes: Fed’s Beige Book and Real Estate Developments

Timestamp: 24:16 – End

In closing, Ryssdal references the Federal Reserve’s Beige Book, highlighting its focus on tariffs and uncertainty: “Tariffs mentioned 49 times, uncertainty 45 times” (24:39). He also touches on real estate developments, noting the General Services Administration’s decision to remove the J. Edgar Hoover Building, among others, from its non-core property list, signaling potential changes in federal property management.

Ryssdal wraps up by acknowledging the dedicated media production team and signing off, reinforcing Marketplace's commitment to delivering insightful economic analysis.

Notable Quotes:

• Louise Shaner: “With less input, the data that the government gathers will get worse over time.” (02:38)

• April Hemmes: “We in the ag community are worse off now because the interest rates are higher than they were before and our cost of production's way up.” (05:27)

• Susan Wachter: “If the data are not good, your answers to those questions are also not going to be good.” (02:55)

• April Hemmes: “I have had, this is my 40th year farming. I'm going to be planting my 40th crop and I'm very proud of that.” (08:28)

This episode of Marketplace delves deeply into the pervasive uncertainty in the current economic climate, examining the ramifications of policy changes, market fluctuations, and the resilient spirit of entrepreneurs navigating these turbulent times. Through expert insights and personal stories, Kai Ryssdal paints a comprehensive picture of an economy in flux, providing listeners with the context needed to understand and adapt to ongoing changes.