Episode Overview
Podcast: The Indicator from Planet Money
Episode Title: Chips up, rent down, and are people really skimping on holiday gifts?
Date: December 5, 2025
Hosts: Darian Woods, Waylon Wong
Guest: Jeff Guo (Planet Money)
This “Indicators of the Week” episode explores wild price surges in computer memory chips, new trends in holiday spending, and welcome news for renters as nationwide asking rent prices decline. Along the way, the hosts discuss economic cycles, shifting consumer behavior, and how housing supply can shape affordability.
Key Discussion Points & Insights
1. Microchip Market Drama: RAM Prices Quadruple
[02:11–04:46]
- Indicator: The price of RAM (memory) chips has quadrupled in just a few months.
- Main driver: Explosive AI demand, particularly from data centers, leading to a rapid surge in short-term memory chip prices.
- Some computer stores have stopped listing RAM prices—now, you have to “ask an associate” for the day’s fluctuating rate, likened to luxury seafood pricing at restaurants.
- Cyclical Industry: The memory chip market is prone to huge booms and busts due to long lead times for factory construction and variable demand.
- Recent history: Just a couple years ago, RAM prices crashed after manufacturers overestimated demand.
- Quote:
- Jeff Guo [03:18]: “They're selling it like it's the catch of the day. They're like, please ask your waiter.”
- Jeff Guo [02:43]: “Thanks to all that demand from AI just in the past couple months, the price of these chips have quadrupled.”
- Comparison: RAM chips are compared to other cyclical goods (e.g., Christmas trees, oil, beef): products where supply takes years to ramp up, causing dramatic price swings.
- Outlook: Current shortages mean prices are unlikely to fall soon.
2. Holiday Gift Spending: Intentions vs. Reality
[04:51–06:51]
- Indicator: $778 — the average amount Americans say they will spend on holiday gifts this season, according to Gallup.
- Noteworthy: This planned amount fell by $229 between October and November, the largest recorded drop (even steeper than during the 2008 financial crisis).
- Behavior Gap: Despite stating lower intentions, Americans spent record amounts online—Black Friday hit nearly $12 billion (up 9%), and Cyber Monday rose by 7% compared to last year (Adobe Analytics).
- Quote:
- Waylon Wong [05:25]: “This decline from October to November is the biggest drop Gallup has ever Recorded. It's even bigger than what they saw during the financial crisis in 2008.”
- Darian Woods [05:32]: “Okay, so this is what people say they plan to spend. ... I'm curious, what did people actually do then?”
- Jeff Guo [06:09]: “Okay, so you're saying people told Gallup that they were going to spend less, but then they got on their phones, they saw the sales, and then what, their budgets just went out the window?”
- Economic Split: The rise in spending is likely driven by wealthier shoppers, while people with lower incomes pull back—a classic “K-shaped recovery.”
- Definition: “K-shaped economy” means higher earners do better while lower-income earners struggle.
- Quote:
- Waylon Wong [06:36]: “Yeah, and this is called a K shaped economy, right?...Higher earners are spending more. People with fewer resources are falling further behind.”
3. Nationwide Rents: A (Slight) Break for Renters
[06:51–09:06]
- Indicator: -1.1% — The national average decline in asking rents for apartments from last year, per apartmentlist.com.
- Contrary to broader affordability woes, new lease prices are down on several major rental listing sites.
- Nuances:
- The decrease is an average; it doesn't mean all renters are seeing lower rents, especially in renewals.
- Apartment rents continue to rise in cities like San Francisco, Chicago, and St. Louis (up 4-5%), but Sunbelt areas (Texas, Louisiana, Florida), especially Austin, are seeing steep rent drops.
- Quote:
- Darian Woods [07:16]: “That's amazing for renters, Right? That's a huge deal.”
- Waylon Wong [07:19]: “This is interesting because it's contrary to the overall affordability narrative we've otherwise been hearing, Right?”
- Root Cause: A surge in apartment construction is the likely driver.
- 2024 saw the most new apartment builds in a single year since 1986.
- Cities with easier permitting processes (e.g., Austin and other southern metro areas) are leading the way in reducing rents.
- Quote:
- Jeff Guo [08:57]: “You know, it's almost as if the more homes you build, the lower the prices get. It's almost as if supply and demand sometimes works.”
- Darian Woods [09:06]: “You'll have a hard time fighting against basic economic principles.”
Notable Quotes & Memorable Moments
- On RAM Chips Like Fine Dining [03:18]:
- Jeff Guo: “They're selling it like it's the catch of the day. They're like, please ask your waiter.”
- On Consumer Spending Psychology [06:09]:
- Jeff Guo: “...People told Gallup that they were going to spend less, but then they got on their phones, they saw the sales, and then their budgets just went out the window?”
- On K-Shaped Recovery [06:36]:
- Waylon Wong: “Higher earners are spending more. People with fewer resources are falling further behind.”
- On Supply and Demand Working [08:57]:
- Jeff Guo: “It’s almost as if the more homes you build, the lower the prices get. It’s almost as if supply and demand sometimes works.”
- On Economic Cycles [04:19]:
- Darian Woods: “This actually reminds me of a old Planet Money episode where the exact same thing happened in Christmas trees.”
Timestamps: Key Segments
- 02:11 — RAM chip price surges explained by Jeff Guo
- 04:51 — Holiday gift spending intentions and actual behavior discussion
- 06:51 — National rent averages drop; causes, nuances, and regional details
- 08:57 — Reflection on housing supply and the basic principle of supply and demand
Tone & Dynamics
The hosts and guest maintain a lively, conversational tone, mixing playfulness with clear explanations of economic concepts. The memorable moments come from humorous analogies (RAM as “catch of the day") and candid observations ("their budgets just went out the window"). The language is accessible and relatable, with quick banter and sharp insight into economic trends.
Summary
This episode delivers a snapshot of today’s economy in under 10 minutes, exploring why RAM chips have become as unpredictable—and expensive—as fine seafood, how Americans say they’ll cut back on gifts but can’t resist online deals, and why renters in the South are finally getting some relief. The big takeaway: Market cycles, supply and demand, and consumer psychology remain as powerful as ever in shaping economic reality.