A thawing housing market?
Jan 27, 2023
Episode 849

A thawing housing market?

New data shows signs that homebuyers are feeling less discouraged.

Higher interest rates have cooled off the once-hot housing market. But for the first time in seven months, pending home sales have improved, which means the housing market is seeing some movement. And China’s oil and gas use fell for the first time in decades! Kai is joined by guest host Amy Scott to discuss all this and play a round of Half Full/Half Empty.

Here’s everything we talked about today:

We love hearing and reading your questions and comments, so please keep sending them! You can write to makemesmart@marketplace.org or leave a voice message at 508-U-B-SMART.

Make Me Smart January 27, 2023 transcript

Note: Marketplace podcasts are meant to be heard, with emphasis, tone and audio elements a transcript can’t capture. Transcripts are generated using a combination of automated software and human transcribers, and may contain errors. Please check the corresponding audio before quoting it.

Kai Ryssdal  00:04

Well, there we go. Sit here long enough, Drew says yes, let’s get going because Drew, is of course, is in charge.

Amy Scott  00:11

Hey, everybody, I’m Amy Scott. Welcome back to make me smart where we make today make sense.

Kai Ryssdal  00:17

I’m kind of Kai Ryssdal back on a Friday for the first time… I think in a very long time. It feels like I have not done this on a Friday in a long, long time. Thanks to everybody joining us on the podcast and on the YouTube livestream for Economics On Tap, the day of the week where we do the news fix with drinks on hand, though I don’t have any… Happy to talk about that later. Also, maybe a little game at the end. Are you drinking Miss Scott? What are you drinking?

Amy Scott  00:39

Yes, I am. I was too lazy last week to make an old fashion. So I did it today. So cheers.

Kai Ryssdal  00:47

Good job

Amy Scott  00:48

Sorry you don’t have anything to talk about

Kai Ryssdal  00:52

Well, you know, so  here’s the deal…  I didn’t bring a can of water. I interviewed the “Liquid Death” guy this week. I should have brought a can of water. But I thought about this while I was running this morning. So number one, I have a soccer game this afternoon. So I’m not drinking. Number two, I’m doing dry January. So I’m not drinking. I will also say dry January is miserable.

Amy Scott  00:54

You didn’t bring a can of water? Oh good for you!

Kai Ryssdal  01:07

Yeah, well, you know, it’s very interesting. I don’t think I would do it again. It’s an interesting exercise. I don’t think I would do it again, I would do like a dry week, you know, whatever. But it did occur to me that I in particular, have in the course of this podcast on Friday afternoons. Not been truly aware of those who don’t drink who are in recovery, who for whatever reason, can’t drink whatever. And so just a nod to them. And a shout out to them. Because there are people who like this podcast who don’t imbibe and that’s cool, too, and I just want to give them a nod. And I thought about that while I was running this morning. So nod has been given. There you go.

Amy Scott  01:51

I approve. I appreciate that. So as you know, I’m terrible at looking at the chat. So I don’t know if other people are piping in with what they’re drinking.

Kai Ryssdal  01:59

Let’s see. Oh, a Nordic Sidecar. I don’t even know what that is… a sidecar made with Minnesota made aquavit. Oh my god. Aquavit is some serious stuff? My dad… oof yeah.

Amy Scott  02:08

Yeah, that sounds amazing.

Kai Ryssdal  02:10

It’s a little scary. Actually a little scary.

Amy Scott  02:12

I don’t really know what it is. But I ate at a restaurant called Aquavit once.

Kai Ryssdal  02:17

Yes, as have I.

Amy Scott  02:18

Maybe they served it right?

Kai Ryssdal  02:19

Yeah. in New York, right?

Amy Scott  02:21


Kai Ryssdal  02:21

Yeah, you bet. I’m not even sure still there actually.

Amy Scott  02:26

Nothing is there.

Kai Ryssdal  02:27

Anyway, let’s do a little news. Shall we? You go first while I google Aquavit the restaurant.

Amy Scott  02:33

Okay, that sounds good. Yeah, so I’m going to start with a sober topic just because I want to acknowledge that the nation is really preparing for this video to come out tonight, showing the beating of Tyre Nichols by five police officers in Memphis. They’ve been charged in his killing. And you know, cities around the country are are anticipating protests in response. And I think a lot of folks are on edge. But I wanted to direct folks attention to a story in The New York Times, Clyde McGrady had a good accounting of police reforms in the last couple of years. Since the murder of George Floyd in Minneapolis, states have passed more than 140 oversight laws, which is, I think, pretty significant. They’re mostly focused on accountability and transparency. Activists, of course, would like to see a lot more work done on this issue. Memphis itself voted to require the Memphis Police Department to adopt policies to reduce the use of excessive force, obviously, that is going to be revisited. So really, just to you know, acknowledge that that’s going on and hoping that the weekend passes peacefully.

Kai Ryssdal  03:43

Yeah, me too. And just a word here. That video is gonna be everywhere. And you don’t have to watch it. You don’t have to. Yeah, cuz, you know, it can be traumatic. And, yeah, I’m not gonna watch it.

Amy Scott  03:57

Yeah, I don’t plan to either

Kai Ryssdal  03:58

I don’t want to and I don’t feel the need.

Amy Scott  04:02

So totally different topic. There’s really no good way to make this transition. But since I’m here, and I cover housing, just wanted to give you this little glimmer of maybe a thaw in the housing market. We’ve been kind of talking about that a lot on Marketplace this week. But today, the official numbers, the pending home sales numbers from the National Association of Realtors came out for December. It was the first increase in pending home sales of existing homes in seven months, which is significant. And we’ve seen, you know, interest rates falling in the last couple of months. That’s certainly driving more interest in sales. And pending sales are seen as a fresher indicator of the housing market, because these are houses under contract that haven’t closed yet. The closing process can take a month or more. And so this is, you know, sort of real time as real time as we get with these kinds of things, a sign that the housing market may be thawing just a bit.

Kai Ryssdal  04:55

Yeah, yeah. And people coming back after having been scared off by those interests, by those mortgage rates. Okay, so here’s mine, quick item that I saw in the New York Times today, its data from the International Energy Agency pointing out that in 2022, China used less gas and oil for the first time in decades, which makes total sense, right? Most of that country, most of that economy was shut down for large parts of last year, the big cities were shut down, people weren’t traveling, all that jazz, right? It makes total sense. And that’s not why I bring it up. I bring it up, because as painful as it is being right now… To open back up in China, because COVID is running rampant, and people are trying to figure it out. Economic activity is going to pick up and oil and gas consumption is going to pick up and what happens when consumption and demand pick up. Well, the price goes up. Right? And while we have been enjoying, generally speaking, falling oil and gas prices for six-ish, maybe eight-ish months, I think with the Chinese economy becoming back online, American consumers, because let’s remember… oil is a global commodity, right? And it is a global  American consumers need to be ready for slightly to moderately higher oil and gas prices. It would not surprise me at all by the middle-ish of the year, you know,

Amy Scott  06:16

Yeah, I was wondering what that’s going to mean for carbon emissions too. Because, you know, the beginning of the pandemic, we saw the United States emissions dropped significantly. They’ve since started growing again. And so I wonder if we’ll see even bigger numbers this year as China has its own recovery?

Kai Ryssdal  06:35

Definitely will, definitely will. Okay. I believe we’ve come to the Drew Jostad portion of this.

Amy Scott  06:41

Should we play a game?

Kai Ryssdal  06:43

We shall indeed. By the way, acquavit is still open in New York City.

Amy Scott  06:49

Oh, nice. That’s good. I’m glad we didn’t mistakenly say they were gone.

Kai Ryssdal  06:55

Oh my Lord. All right, so “Half-Full Half-Empty” is the game in which Drew Jostad gives us the news. And we will tell you how we are feeling about them. Drew, go.

Drew Jostad  07:05

This first one is a real estate topic. A new proposed project for the Baldwin Hills neighborhood of LA has a Costco on the ground floor. And then apartments above it. Are you half full or half empty on the concept?

Kai Ryssdal  07:22

Oh, interesting

Amy Scott  07:24

Well… How we how many levels of apartments? That’s probably…

Drew Jostad  07:31

The sketch looks like five floors. It’s a total of 800 apartments.

Amy Scott  07:37

Well, you know, I’m in favor of new housing. Yay. I mean, I think that makes sense. I hope it’s nice. I am not a Costco devotee. I know there are some that have you know, hosted this program previously. It’s just too far from my household. So I can’t say like yay upstairs from Costco. I hope they’re big enough and have pantries though because if you’re buying in bulk takes a lot of space.

Kai Ryssdal  08:01

Exactly. So look, I’m have fallen this for two reasons. Number one, mixed use right? Mixed use developments and walkability. One imagines that that’s going to be a good neighborhood. And so yes, I’m in favor of that. Also, I am or have been a Costco devotee. And that actually came up in a conversation my wife and I were having the other day. So like eight or nine years ago, when all three boys were still home, and our daughter is here. And we had four kids and two adults, we were going to Costco, like every 10 days. And we would go and buy four gallons of milk every 10 days, and we would blow through it. I went to the store the other day, and got a half a gallon of milk. Just because it’s 3 of us. And we don’t have three ravenous boys.

Amy Scott  08:43

I’m always sad when we talk about the empty nest.

Kai Ryssdal  08:47

It was a little sad. It was a change. It’s not empty yet, but it’s way less crowded than it used to be. Yeah, let me tell you we are a half gallon of milk at the time family. That’s right.

Amy Scott  08:57

So I guess we both are half full on that one. Half full of milk.

Drew Jostad  09:00

Half full or half empty on the drama with the m&ms.

Kai Ryssdal  09:05

Oh my god, can somebody fill me in on this? Because I genuinely don’t know what happened.

Amy Scott  09:11

So Drew, I don’t know if you want to fill him in. I can do my best. I think the TLDR is it looks like it was just a stunt. They like said the m&m, you know characters were taking a pause after some conservative criticism that they were trying to be to, quote unquote, “woke” by including, you know, purple and making them less sexy. I was like, “were the m&ms ever sexy?” This is insane.

Kai Ryssdal  09:38

No, it was weird.

Amy Scott  09:41

It was totally weird. The whole thing was really weird. And I just read a story in The Times that suggests that maybe this was just to try to get more people to watch their commercial for the Super Bowl. The cartoon characters are not gone. Hopefully Maya Rudolph is involved because she’s awesome. But yeah, I’m half empty on the whole thing.

Kai Ryssdal  10:00

Yeah, like Tucker Carlson got spun up and it became a thing. Yeah, half empty. I’m all the way empty. Forget it. Boo. Boo.

Drew Jostad  10:11

All right. Next topic is a new service for Amazon Prime members that is a prescription generic drug subscription service, half full or half empty?

Kai Ryssdal  10:27

Yeah, I might even like to see some kind of variation on the price. So I’m half full, because people need medications. And if we can get them cheaper, that’s great. But Amazon Prime is not cheap. And I think if they could come up with some cheaper subscription service that let you get those medications at a decent price, that would be better. But generally speaking, I’m half full, because look, drugs are expensive.

Amy Scott  10:47

Yeah, I guess I would say I’m half empty, just because I think we don’t need one company that does so much in our economy, and maybe someone else can do that.

Kai Ryssdal  10:56

Yeah, yep. That’s fair. Here’s the thing though…

Amy Scott  10:59

Also they killed Smile, which was like the way that you could donate to a charity of your choice. And there were all these small charities that, including our kids’ school, that got you know, a little bit of chunk of change from that. So maybe I’m just kind of mad right now.

Kai Ryssdal  11:14

Totally true. Yeah. All right. Drew?

Drew Jostad  11:20

We want to do a poll? On the next one?

Kai Ryssdal  11:23

Are we there yet? Of course we want to do a poll! Holy cow. I’m just blowning through this thing. Yeah.

Amy Scott  11:27

For those of you on the YouTube livestream, we’re going to take a little poll on this last topic. So don’t forget to weigh in with your answers. And hopefully someone will tell me what your answers are.

Kai Ryssdal  11:37

Yeah, I have not yet figured this out. So Mel or whoever’s running this thing has to hook us up. I’m a little helpless with this thing. Okay, so we will hold our responses and give you guys you know, 30 seconds wigh in on the poll. And this obviously, is for the youtubers on Friday afternoon. It’s not for the people listening to the pod later. Sorry. Okay. Drew!

Drew Jostad  11:55

Are you half full or half empty on people using Chat-GPT to write cover letters for job applications?

Kai Ryssdal  12:08

Huh. Very interesting. Very interesting. I have thoughts. I have thoughts. Which I will share in like 20 seconds. Yeah.

Amy Scott  12:22

So we won’t be swayed by our audience.

Kai Ryssdal  12:25

That is correct.

Amy Scott  12:27

I feel like every week, it’s gonna be a new variation on Chat-GPT.

Kai Ryssdal  12:31

I know, right? Well, it isn’t. That’s the thing. I mean, this is still early days yet. Really early days.

Amy Scott  12:36

I saw someone on Bloomberg tried to get Chat-GBT to create an ETF that would beat the stock market. Hilarious. It was like, “please consult a financial professional before”

Kai Ryssdal  12:49

No, really? Oh, that’s so funny

Amy Scott  12:50

It was basically like “we can’t…we can’t do that.”

Kai Ryssdal  12:52

Yeah. Okay, all right. I’m calling it. Okay. So generally speaking, I’m opposed. Although I’m not a Luddite, and I cannot stand athwart, the river of history that’s coming at us with AI and technology and all that jazz, and it’s going to happen. I just want us to be smart about it. And I want people to understand the downsides of relying on artificial intelligence for stuff that human intelligence ought to do. And I think making yourself presentable to an employer is the thing that human intelligence ought to do. So I’m kind of half empty-ish.

Amy Scott  13:27

Yeah, I would agree, I hate to be a downer. At first. I was like, “oh, wouldn’t it be nice to have help with that?” Because that cover letter… I’m thinking about, like, applying for grants, which I do for my films, and it’s… you just want somebody to like help you with that introduction. So again, I understand that the the temptation, but I would agree with Kai, like, communication is really important. Yeah, I guess I’m half empty. Sorry, Drew. I feel like we’ve been kind of down.

Kai Ryssdal  13:58

Alright, so here is the poll results. Wow, we’re pretty split. 161 votes. 50% of you are half full 49% of you are half empty. Hmm. I don’t know what that says about our audience.

Amy Scott  14:16

want to know what people are thinking who are half full?

Kai Ryssdal  14:21

Well, yeah, so look, let’s let’s do this. We’re going to talk about…. Kimberly and I…. So Kimberly is coming back next week, which we’ll get into it in a second. But we’re going to talk about AI and Chat-GPT. So if you’ve got thoughts on on that topic, generally speaking, write to us, we’ll choose some of them, get them on the pod. And, and you know, and that

Amy Scott  14:41

I would like to be convinced or at least, you know, to hear why people are in favor of that.

Kai Ryssdal  14:46

Totally, totally. So I kind of bury the lead there. Kimberly’s coming back on Monday. She’s been I think off on a family vacation, I believe. I don’t know. Amy Scott has been awesome the past couple of weeks and Matt Levin and Janet and everybody else who’s filled in. I think Sam Fields did it once or twice. So thanks all you all who did the thing while Kimberly and I were off doing other things. If you have, by the way, a question you want us to answer for what do you want on a Wednesday? Or if you’ve got just a comment, or a question, or anything, or the answer to the Make Me Smart question. Send us what you got. Here’s how to do that.

Amy Scott  15:23

You can leave a voicemail at 508- U-B-SMART. Just one last time remember that’s the letter “U” the letter “B” S-M-A-R-T. Or you can email makemesmart@marketplace.org

Kai Ryssdal  15:36

I don’t think it’s the last time we’ll see you here

Amy Scott  15:39

For a while.

Kai Ryssdal  15:43

Make Me Smart is produced by Courtney Bergsieker. Today’s episode was engineered by Drew Jostad who also wrote the theme music to our game Half-Full/Half-Empty. Antonio Barreras is our intern.

Amy Scott  15:53

The team behind our Friday game is Mel Rosenberg, Emily McCune and Antoinette Brock. Marissa Cabrera is our acting Senior Producer, Bridget Bodnar is the director of podcasts and Francesca Levy is the Executive Director of Digital.

Kai Ryssdal  16:08

Perfect timing. Perfect.

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