Squawk Pod Episode Summary

Episode Title: Local Shopping, Macroeconomic Thinking
Date: December 1, 2025
Hosts: Joe Kernen, Becky Quick, Katie Kramer
Key Guests: Caroline Weaver (Locavore store owner), Mohamed El-Erian (Wharton/Allianz)

Overview

This Squawk Pod episode explores the intersection of local, small business shopping trends and the macroeconomic landscape as the holiday season kicks off. The discussion ranges from on-the-ground realities facing local shop owners like Caroline Weaver in New York, to economist Mohamed El-Erian offering insights into Federal Reserve policy, AI’s influence on markets, inequality, and how capitalism may be falling short for many Americans. The episode is laced with both humor and candid takes, capturing the season’s economic pulse.

Key Discussion Points & Insights

1. Holiday Shopping Trends & Local Business Realities

Featuring: Caroline Weaver, Locavore Store Owner

Segment: 15:52–21:22

• Definition of "Locavore":
  Consuming goods made within 100 miles of where you are

  • Caroline Weaver explains, “It's a term used to describe people who consume locally.” (16:26)

• Portfolio of Goods:
  Weaver's shop sells a range from hand-blown glass to nail clippers and screwdrivers. "It's truly almost everything." (16:51)

• Sourcing Challenges & Global Supply Chains:
  Although goods are locally produced, many ingredients (especially packaging) are sourced internationally.

  • “Almost none of those things are made entirely of American parts...so much of the packaging that my vendors use does not come from America.” (13:52, 17:38)

• Tariffs and Pricing:
  Tariffs have made local goods relatively more attractive, but costs are still high and increases haven’t fully hit due to prior stockpiling.

  • “My prices...have increased about 10 to 15%. But I'm not as immune to it as people assume I am.” (18:06)

• Consumer Trends:
  “People are starting to shop earlier this year...consumers are a little bit anxious about supply, they're a little bit anxious about pricing, and they're trying to be strategic about their shopping.” (20:58)

• Misconception on Cost:
  The perception that local goods are automatically more expensive isn’t always true due to lower overhead and lack of big business mark-ups. (18:36)

2. Small Business and the Political/Economic Environment

• Challenges for Small Retailers:
  “We kind of are marginalized because we exist on the fringes of a lot of these capitalist systems.” (20:19)

  • Manufacturers prioritize larger businesses during supply chain stress, impacting small business inventory availability, especially during Christmas.

• Perspectives on Governance and Systemic Change:
  Weaver expresses a willingness to consider new systems, citing the difficulties faced by small businesses:

  • “I think something has to change, and it's a really, really challenging climate for independent retail...we are open to something new.” (20:04)
  • “Affordability and safety in New York City has so much to do with what is in our storefronts.” (19:35)
  • “Whatever is happening right now also isn't working.” (19:52)

3. Black Friday/Cyber Monday Data and Market Updates

Hosts: Joe & Becky
Segment: 08:31–13:38

• E-Commerce Growth:
  • Black Friday 2025 online sales hit a record $11.8B (Adobe), up 9%. Mastercard reports e-commerce up 10.4%. (08:31)
• Airbus Safety Fix:
  • Software issues fixed on most affected A320 jets post–solar radiation incident. (09:05)
• Data Center Outage:
  • A Chicago-area data center outage triggered a major CME market halt—a reminder of how infrastructure supports the financial system. (10:06)
• Nvidia–Synopsys $2B partnership:
  • Not just a financial investment, but an expanded effort to co-innovate new AI engineering tools (CUDA evolution). (12:22)

4. Fed Chair Search and Macro Policy Debates

Hosts: Joe Kernen, Becky Quick, Mohamed El-Erian
Segment: Scattered from 04:28–07:59, deeply from 23:35–33:53

• Fed Succession “Soap Opera”:
  President Trump has reportedly picked a Fed Chair, speculated to be Kevin Hassett; markets reacted positively to the expectation of a dovish leadership.

  • “I think the market would like to be guaranteed of another rate cut or two.” (06:45)
  • “The market...wants somebody who is a strong, independent Fed leader.” (07:11)

• Danger of Overdependent Market:
  The hosts discuss the risk in markets desiring “easy money at whatever the cost.”

  • “Is the market that...addicted to easy money at whatever the cost?” (06:54)

• Observation on "Karens" and "Kevins":
  Both light-hearted and pointed: “Kevin is the male Karen, supposedly.” (02:02, 07:59)

5. Macroeconomic Analysis with Mohamed El-Erian

Segment: 23:35–33:53

a) Market Sentiment and Fundamentals

• Shifting Market Dynamics:
  “Trade has become more differentiated...People have understood that vertical integration matters...AI being much more fundamentally driven than hype driven.” (23:54)

• On AI & Data Centers:

  • AI is causing a real shift in demand shaping GDP, preventing a “store speed” scenario in the economy.
    • “If it weren't for AI-related [demand] we would be talking about store speed because the rest of the economy is having a harder time.” (25:22)
  • Profitability from AI investment will depend on adoption, not just building tools:
    • “[We] need an adoption policy...That’s why we risk falling behind China.” (26:43)

b) On the Federal Reserve & Reform Needs

• Central Issues:

  • “We are captivated right now, understandably, by two things. Will they cut this month or not? And who will be the next Fed chair?” (01:34, 28:29)
  • “As important is, how will this Fed be reformed? This Fed went to sleep.” (01:34, 28:29)

• Call for Change at the Fed:

  • “The compliance culture has to improve...the Fed is so central to our economic well-being.” (28:29)
  • “We don't need a play-by-play Fed. We need the Fed to cool it, step back and take a visionary view...We desperately need reforms.” (29:06)

• Market Expectations are Volatile:

  • “In the last month the probability of a December cut has gone from 90% to 30%, back up to 86 or 87...This should not happen. The whole point of forward guidance is predictability.” (29:57)

c) On Capitalism, Inequality, and Institutional Failure

• Generational Disillusionment:
  Joe: “If 51% of people under 30 think socialism is...preferable to capitalism, how does that work itself out as time goes by?” (30:18)

• El-Erian’s Diagnosis:

  • “Young people...feel the system doesn’t work...We didn’t pay enough attention to not just what is necessary—market-based capitalism—but what’s necessary and sufficient, which is also to recognize that there are market failures.” (30:51)
  • “If you don’t address the failures, the people who are left out come back and undermine the whole system.” (31:36)
  • Calls to address monopoly power, productivity, and infrastructure: “We've got to also look at how to make sure that the productivity promise that’s ahead of us is something that is offered by many.” (32:04)

• Affordability & Real Income:
  Inflation under Biden: “21 and a half percent... is why we have an affordability [crisis]...The key to affordability is going to be income. Wages have to go up.” (33:26–33:48)

Notable Quotes & Memorable Moments

• On the paradox of “local”:
  Caroline Weaver: “All of my things are local, but almost none of those things are made entirely of American parts... a lot of it is packaging. So much...does not come from America.” (13:52, 17:38)

• On resilience of small business:
  “We are marginalized because we exist on the fringes of a lot of these capitalist systems.” (20:19)

• On Fed predictability:
  Mohamed El-Erian: “This should not happen. The whole point of forward guidance is predictability and stability.” (29:57)

• On systemic dissatisfaction:
  Mohamed El-Erian: “If you don’t address the failures, the people who are left out come back and undermine the whole system.” (31:36)

• Market commentary as humor:
  Joe Kernen: “Kevin is the male Karen, supposedly.” (02:02)
  Becky Quick: “I just call the male versions Karen, too.” (02:05, 08:19)

Timeline of Key Segments

| Timestamp | Segment | |-----------|----------------------------------------------------------------------------------------| | 01:04 | Episode intro: shopping season, Caroline Weaver interview, macro talk with El-Erian | | 08:31 | Black Friday/Cyber Monday data, e-commerce trends | | 15:52 | Caroline Weaver interview: local shopping, tariffs, small business challenges | | 23:35 | Mohamed El-Erian interview: market fundamentals, AI, Fed policy, economic reforms | | 32:35 | Discussion on capitalism vs. socialism, market and institutional failures |

Conclusion

This episode weaves together the grassroots reality faced by local business owners and the global complexities of 2025’s markets and economic policy. Localists like Caroline Weaver face persistent challenges from global supply chains and systemic pressures, while Mohamed El-Erian warns that both market and government failures must be directly addressed to maintain social and economic stability—especially as younger generations lose faith in the status quo.

Squawk Pod captures the anxiety, wit, and optimism swirling around the 2025 holiday economy, leaving listeners with an essential snapshot of both consumer and macro perspectives as the year closes.