Planet Money: "Indicators of the Year, Past and Future"

Host: NPR
Episode Date: December 31, 2025

Overview

In this special year-end crossover between Planet Money and The Indicator, the team hosts a spirited, competitive roundtable—dubbed the “Indicators of the Year Family Feud”—where hosts and reporters pitch their top economic indicators of 2025, explaining why each deserves the crown. The episode also includes forward-looking predictions, as three more indicators are presented as “ones to watch” for 2026.

1. Indicators of the Year: The Planet Money Family Feud

(00:57 – 09:46)

Host Introduction

• Waylon Wong sets the stage, describing the annual tradition: a friendly but intense competition to out-nerd each other with stats and economic storytelling.
• Each participant has 60 seconds to make their pitch for their candidate Indicator of the Year; listeners will eventually vote on the winner.

Contenders & Their Indicators

A. Consumer Sentiment

Presented by: Kenny Malone
Segment: 2:57 – 4:38

• Kenny reuses (and openly jokes about reusing) old scripts because Consumer Sentiment has been a recurring winner for “Indicator of the Year.”
• Key Point: Consumer sentiment—a measure of how people feel about the economy—has hit historic lows, dropping from pre-pandemic averages (~100) to the 50s in 2025.
• Quote:

  "2025 was the year we began to full on drown in bad feelings about the economy. We're sick to our economic stomachs about the future of prices and inflation and, and jobs and housing." (Kenny Malone, 03:32)

• Stresses that consumer sentiment is “the canary in the coal mine” for the economic outlook.

B. Tariffs

Presented by: Greg Rosalski
Segment: 4:42 – 6:15

• Greg points to tariffs as the game-changing economic force of 2025—calling back to President Trump's tariffs, including on trading partners as unexpected as territories with “mostly penguins.”
• Notes “Liberation Day” as a flashpoint, the massive stock market reaction, and ongoing drama over tariff constitutionality and a Supreme Court case.
• Key Data:

  "In 2024, the average effective tariff rate that U.S. consumers face was 2.5%. That number is now 16.8%. That's the highest tariffs have been since 1935." (Greg Rosalski, 06:03)

• Costco has even filed a lawsuit against the Trump administration over them, underscoring how all-encompassing tariffs have become.

C. CAPE Ratio (Cyclically Adjusted Price-to-Earnings)

Presented by: Darian Woods (as “Count Dracula”)
Segment: 6:44 – 8:34

• Darian whimsically dons a cape for his pitch, linking Halloween horror to economic dread.
• Key Point: The CAPE ratio reflects how expensive stocks are relative to their earnings. In 2025, the ratio is at its highest since just before the dot-com crash.
• High CAPE signals concerns about bubbles (especially around AI), the "K-shaped" economy, and widening inequality as the rich get richer on stock gains.
• Quote:

  "The higher the CAPE ratio, the more expensive stocks are. And this indicator is the highest it's ever been apart from just before the dot-com crash. And that is as frightening as any horror story, because when stocks are this expensive, they tend to underperform over time." (Darian Woods, 07:14)

Banter & Memorable Moments

• Kenny is teased for reusing the same pitch, and admits to reading not just his own but also Adrian Ma’s old consumer sentiment scripts.
• Darian’s Count Dracula impression gets applause:

  "My indicator here is the CAPE ratio." (Darian Woods, 09:18)

• Greg jokes about Costco’s lawsuit:

  "I don't care how they deliver it, as long as hot dogs are still $1.50." (Greg Rosalski, 06:31)

2. Looking Ahead: Indicators to Watch in 2026

(09:46 – 16:51)

A. Federal Funds Rate & The Future of the Fed

Presenter: Waylon Wong
Segment: 10:30 – 12:38

• The Fed funds rate is now 3.5–3.75%; three rate cuts at end of 2025 reflected internal divisions.
• With Jerome Powell’s term ending in May—and heightened presidential pressure for lower rates—Fed independence remains a huge story.
• Quote:

  "Powell's term as Fed Chair ends in May. The President has been very clear about how he wants lower interest rates. And then he said on Truth Social just before Christmas, anybody that disagrees with me will never be the Fed chairman." (Waylon Wong, 11:33)

• Major court fights (e.g., over Lisa Cook's firing) add further intrigue.

B. Electric Rates & Affordability

Presenter: Stephen Psaha
Segment: 12:40 – 14:37

• While food inflation has eased and rents have dropped, electric rates have become the standout affordability challenge, climbing 7% (well above the sub-3% overall inflation).
• AI-driven demand and data center construction are primary culprits, along with infrastructure and disaster costs.
• Winter heating costs projected to jump 12% for electricity users.
• Quote:

  "For a long time, electric rates in the US have been pretty stable for like 20ish years. But recently...the cost of electricity in the US has been climbing way faster than overall inflation. Electric prices have jumped about 7%." (Stephen Psaha, 13:08)

C. Consumer Spending (and the Power of the Top 10%)

Presenter: Cooper Katz McKim
Segment: 14:50 – 16:38

• While consumer sentiment is historically low, actual consumer spending in 2025 has stayed resilient—driven almost entirely by the top 10% of earners.
• The richest 10% (incomes >$200k) now account for nearly half of all consumer spending, benefiting from recent tax cuts, stock gains, and home equity.
• For the broader middle and lower classes, the story is gloomier: record high auto loan delinquencies and credit card debt point to stress.
• Quote:

  "Just the top 10% of consumers account for a near majority of consumer spending according to global bank RBC." (Cooper Katz McKim, 15:24)

• Poses the question: How long can trickle-down consumer resilience last if a market correction strikes?

Notable exchange:

• Waylon: "Sounds a lot like trickle down economics. Interesting." (16:38)
• Stephen: "Yeah, it feels like we're rooting for all that spending right now." (16:42)
• Cooper: "It's fine. It's gonna trickle down. It's gonna trickle down." (16:45)

3. Key Timestamps for Major Segments

• 00:57 – Segment begins; premise and rules introduced
• 02:57 – Consumer Sentiment argument (Kenny)
• 04:42 – Tariffs argument (Greg)
• 06:44 – CAPE Ratio/Stock Market Bubble argument (Darian)
• 09:46 – Segue into Predictions for 2026
• 10:30 – Waylon on Federal Funds Rate & Fed Drama
• 12:40 – Stephen on Electric Rates
• 14:50 – Cooper on Consumer Spending/Narrow Affluence

4. Quotes & Memorable Moments

| Timestamp | Quote | Speaker | |-----------|-------|---------| | 03:32 | "2025 was the year we began to full on drown in bad feelings about the economy. We're sick to our economic stomachs..." | Kenny Malone | | 06:03 | "In 2024, the average effective tariff rate...was 2.5%. That number is now 16.8%." | Greg Rosalski | | 07:14 | "This indicator is the highest it's ever been apart from just before the dot-com crash. And that is as frightening as any horror story..." | Darian Woods | | 09:28 | "The cape, Fraser." (impersonating Dracula) | Darian Woods | | 11:33 | "[Trump] said on Truth Social just before Christmas, anybody that disagrees with me will never be the Fed chairman." | Waylon Wong | | 13:08 | "The cost of electricity in the US has been climbing way faster than overall inflation. Electric prices have jumped about 7%." | Stephen Psaha | | 15:24 | "Just the top 10% of consumers account for a near majority of consumer spending according to global bank RBC." | Cooper Katz McKim |

5. Tone and Style

• As always with both Planet Money and The Indicator, the tone is fun, nerdy, and irreverently competitive—full of inside jokes, cross-talk, and playful banter (“family feud” is described as “brutal soul breaking arguments in a fashion most public”).
• Even the presentation of serious statistics and economic warnings is delivered with lightness and humor (e.g., Darian’s Dracula act for the CAPE ratio).

6. Summary: Key Takeaways

• 2025’s defining economic stories are historic lows in consumer sentiment, a paradigm-shifting surge in tariffs, and an alarmingly high stock market CAPE ratio, all with deep links to U.S. politics and global trade volatility.
• Looking ahead, 2026 will see battles over the Fed’s independence, potential electric rate spikes (due in part to surging AI and climate costs), and a precarious consumer spending picture propped up mostly by affluent households.
• The indicators chosen all reflect underlying anxieties: economic inequality, political pressures, and the growing pains of a data-driven world.

For more, tune into The Indicator on January 2nd for the winner of the Indicators of the Year showdown, and sign up for the Planet Money newsletter for economist predictions on 2026.

For those who missed it, this episode provided a lively but thorough recap of the year’s biggest economic signals—along with a peek at which trends and numbers could shape our financial reality in the new year.