One eye on the commodity markets, folks
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Today we’ll preview a story we think we’ll be talking about more soon, including on next week’s evening broadcast at “Marketplace.” There’s been increasing tumult in multiple commodity markets since Russia’s invasion of Ukraine. The markets for wheat, oil and various metals are being stretched to their limits as officials try to navigate both the war and prolonged supply chain issues. For Economics on Tap, our hosts discuss why getting things under control won’t be an easy fix. Then, the government is running out of the funding it uses to cover COVID costs, including tests, vaccines and treatments — the tools we need to bring life back to normal. And we’ll highlight another example of our totally skewed housing market and its implications. It’s a heavy news day, but we’ll finish things off with a round of Half Full/Half Empty!
Here’s everything we talked about on the show today:
- LME: “The World’s Biggest Commodities Markets Are Starting to Seize Up” from Bloomberg
- “The White House says it’s running out of money to cover COVID tests and vaccines” from NPR
- “Homes Earned More for Owners Than Their Jobs Last Year” from The Wall Street Journal
- “The complications of adding background checks to dating apps” from “Marketplace Tech”
- COVID drove people to shop online, and some of those buying habits may stick from “Marketplace”
- Netflix Test Will Let Members Pay for Password-Sharing Users from Variety
- Cardboard cutouts of our favorite host!
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March 18, 2022 Make Me Smart 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: Very deep sigh, very deep sigh. But it’s Friday. Hey, everybody. I’m Kai Ryssdal, welcome back to Make Me Smart making today and maybe the whole week, I don’t know, make sense. We’ll see.
Samantha Fields: I’m Samantha Fields. Thanks for joining us for Economics on Tap this Friday on the YouTube live stream or on the podcast. We like to end the week around here with some news and around our favorite game Half Full/Half Empty.
Kai Ryssdal: So let’s see a couple of things. Number one, apparently the video has been a little glitchy, but it’s good for now. So we’re just gonna roll with it. Number two, and this is a little awkward, Dr. Adams, but your sister is off at a I think it’s a baby shower. So thank you for coming, and we will pass along your best regards. And let’s see number three. What are you drinking? I’m … having a beer. You know, Stone … for me.
Samantha Fields: I’m shocked to hear that Kai. What do you got?
Kai Ryssdal: I know I know. My standard Stone. What about you?
Samantha Fields: I’m channeling Kimberly. Actually. I am drinking a cocktail. It is called “the Last Word.” It’s something I learned about recently at a bar near my house. And it had – normally has gin but they make it with mezcal, which I prefer anyway, so it’s got one part mezcal, one part maraschino, one part green chartreuse, and one part lemon juice. And I highly recommend if you’ve never had it.
Kai Ryssdal: I have never had it. Couple of things. Number one, I used to have a regular bar near my house when I was younger.
Samantha Fields: Oh, did you?
Kai Ryssdal: I don’t anymore. Yeah, it was good. It was nice to have a bar and be regular. Number two. And this is a serious question. What’s the difference between Mezcal and tequila?
Samantha Fields: The smoky flavor, but in terms of what the actual differences and how it’s made? I’m not exactly sure, but I’m going to Mexico soon so I will try to find out.
Kai Ryssdal: Oh, are you? Alright, well, yes, report back if you would the next time you happen to be on this podcast.
Samantha Fields: I’ll do some. investigating.
Kai Ryssdal: Let’s see. Let’s uh, let’s – Yes, let’s check the chat here. We got some Arnold Palmer. Yeah, Christopher Grou says that Stone Hazy is delicious. Blackberry Lemon Vizzy. I don’t even know what that is from from Margie Klich.
Samantha Fields: I don’t know what that is either but now I’m curious.
Kai Ryssdal: Yeah, no joke. Let’s see. Hang on. Right. There was another one up here. Grizzly Paw Brewing Evolution IPA out of Kenmore, Alberta, which I would I would definitely be in favor of.
Samantha Fields: We gotta homemade orange juice and juice.
Kai Ryssdal: I don’t know why Tamara says I look like I’m vibrating. That’s weird. Homemade orange juice and gin, I’d take that.
Samantha Fields: I would too. Oh, people are chiming in on tequila versus mezcal. We’ve got a tequila comes from one state.
Kai Ryssdal: Oh, is that right? Is it like champagne? It’s gotta be like, you know …
Samantha Fields: I didn’t know that. See they’re making us smart on the chat today.
Kai Ryssdal: They are making us smart. They are making us smart, alright. The process and location, look at that. Oh my God.
Samantha Fields: I’ve already learned things.
Kai Ryssdal: No joke, no joke. Okay, so let’s go. So standard standard format applies. We’ll do some news. We’ll do a little Half Full/Half Empty. And then we will be on about our Friday. I’ll go first, just because I’m a first the rundown. And I just want to point out that this is going to be a much bigger story than people I think have been computing for the last 10 days or two weeks. So we know markets had been messed up. Because of the war, right? They had the supply chain glitches to begin with. And then the war went crazy. And we talked about really early on and how Russia and Ukraine together or something like 25 to 30% of the global market and have that’s a bad thing and all of that. There was a story last week that blew my mind. And I’m glad that Matt Levin is going to do it for us on Marketplace on Monday. But it’s it’s a larger thing about markets going haywire. So the nickel market in London at the London Mercantile Exchange, basically broke, the nickel market broke, they shut it down the LME voided a bunch of trades. They wouldn’t let it trade for a week after the price went up like some insane percentage, not necessarily because there’s a nickel shortage but because the market mechanism itself broke. And the same thing is happening, that volatility and the inability of the underlying market to deal with it. Is is fracturing what’s going on. It’s happening in wheat. It’s happening in oil, the commodities markets are really stressed. They’re not handling it and look the hell out. That’s all I’ve got to say. It’s crazy.
Samantha Fields: It’s interesting, someone I was talking to yesterday for a story about how the war is affecting the car market, right? They’ve downgraded the number of cars that they expect that will be made this year by two and a half million and one of the people I was talking to mentioned nickel, she said nickel is just so insane and it goes into car batteries. And you know, this is gonna have ripple effects all over the place.
Kai Ryssdal: Right and and also in your piece, I think talking about wire harnesses that are made in Ukraine, all those wire harnesses which are made for the cares which are now basic right, which are now basically driving computers, all of that stuff. And I don’t know and look, thank God I’m not Jay Powell because I was thinking about how he sleeps given the pressure on him. But but, you know, merely raising interest rates whether US for Christine Lagarde at the European Central Bank, raising interest rates is not going to fix this. And so the challenges I think are going to be long lasting, and I’m not sure anybody’s ready for that yet. Truly,
Samantha Fields: it doesn’t seem like it.
Kai Ryssdal: But what do I know. Yeah. So anyway, that’s my news. I just wanted to throw that out there because it’s a big deal. It’s a big, big deal.
Samantha Fields: So some good news to start off this Friday is what you’re saying?
Kai Ryssdal: Yes, that’s right. That’s right.
Samantha Fields: Well, I have more good news follow you with. Which is, the story I can’t stop thinking about this week is that the US is apparently running out of COVID funding for things like testing vaccines and treatments, the White House had asked Congress for 22 and a half billion more dollars, none of that made it into the government spending package last week, and they’re saying as soon as next week, I think starting Monday, they will no longer they will sort of no longer be able to reimburse or cover cover testing vaccines and treatments for people who don’t have health insurance. And then starting in May, they’re going to start running out of monoclonal antibody treatments, they’re not going to be able to buy new ones, they’re not going to be able to buy antiviral pills, they’re not going to be able to cover the cost of boosters. If there’s a second one needed, which we know both Moderna and Pfizer both are applying for emergency authorization for those they’re not going to be able to cover that for all Americans. And the list goes on and on, we’re not going to be able to send as many vaccines overseas. And so I guess I just keep thinking about what happens. Now we’re at a point in the pandemic, where all the states are getting rid of mask mandates. They’re getting rid of vaccine requirements that a lot of places, and we’re supposed to be sort of getting back to normal life. But to do that we need these tools, right? And if we don’t have the money for these tools anymore, what happens? I mean, there’s a huge wave going on again, or maybe not huge, but there’s a wave again, in Europe. There’s a huge wave in Asia, it’s coming here again. So what are we doing?
Kai Ryssdal: It’s coming, right? So the pandemic is not over. And the way this thing has worked since two years ago is that we see the waves going around the world and they come here, we saw it going through China, and then Europe and then us every single time. And it’s coming here. And the idea now that we’re running out of money to provide all of those things that Sam was talking about. It’s just bananas makes no sense. Makes no sense.
Samantha Fields: I don’t know, I don’t want to live here anymore. But here we are. This is the world we’re in right.
Kai Ryssdal: For sure. You got another one?
Samantha Fields: I do have another one. Actually, another article that really stuck out to me was in the Journal this week. And it was about you know how given how insane the housing markets been, we’ve talked about that a ton on all of the Marketplace programs for a couple of years now. Last year, home, the average home in the US gained more in value than the average worker earned. So the typical home appreciated about 52 –
Kai Ryssdal: Wait, say that again.
Samantha Fields: So the typical home in the US, which I mean, obviously that’s a tricky thing to calculate. But as they’re measuring it, appreciated about $52,000. Last year, the average worker earned $50,000. So homeowners made more from their homes than people made at their jobs. And the number was the numbers are even more insane. In parts of California, there was – they cited in San Diego, the average home appreciated $160,000, the average worker earned $55,000. And I just can’t stop thinking about that. Because one, I mean, so many people self included over here are priced out of the market or feel that way. It just feels completely impossible if you’re not in already, that you can ever think about buying a house. And then also it’s just people who already own homes are just earning more, right. It’s like the gap is widening and widening and rent is going up for people who can’t own homes. So it’s just, I don’t know, it’s just widening so much.
Kai Ryssdal: It’s widening and completely depressing. Two points about that. Number one, the really one of the many depressing parts about this is that this will only exacerbate the racial wealth gap in this country, as we know far fewer people of color in this economy, own homes, than white people, right, and so the white people are accumulating wealth and people of color, specifically Black people, right, because they typically own homes at a far lower rate than almost any other demographic group, get nothing, right. That’s number one. Number two, and this is a little wonky, but bear with me here. Shelter is about 32% of the input to the consumer price index. That is to say, shelter is about 32% of how we measure inflation in this economy. And with home prices going up the way they are with absolutely zero sign that they’re going to slow down, right –
Samantha Fields: Zero sign.
Kai Ryssdal: That means – zero sign. That means that inflation will likely remain higher for longer than many people up to an including I believe Jay Powell think it is going to. And that’s really challenging.
Samantha Fields: Yeah, yeah.. And because another another thing that I had been reading about recently, and thinking about doing a story about is, you know, with home prices going up so much, a lot of people are priced out of the market. And so more people are renting for longer, more higher income people are renting for longer, which is pushing up rents for everyone also. So again, sort of lower and middle income people are being squeezed even more because the rental market is tighter, and more expensive.
Kai Ryssdal: So let me ask you something. Let me ask you something and you can tell me to go to hell if you want to, but what are you gonna do? You’re just gonna run for the rest of your life? Are you pretty much resigned to that?
Samantha Fields: I don’t – I don’t know. I really don’t know the answer to that. Because I, when I think about I live in New York City, obviously one of the most expensive markets in the country. But when I look at other places, I’ve moved a lot. I’ve lived in a ton of different places. I’m very open to that. But any place that I have people is really expensive. You know, and I love living in a city. And cities are expensive. So I just I really don’t know what the answer is yet.
Kai Ryssdal: Yeah, that’s fair. That’s fair. Okay, so look, this is an awkward turn, but I’m gonna make it anyway. Because it’s kind of my job. You know, what else is expensive? This program, and Marketplace, Marketplace Tech and all our podcasts and the Morning Show with David. It’s all expensive. And so we come to you every now and then to ask you to help us out. And you have so far. We are at $53,000. As of this afternoon, the goal is $100,000 by next Wednesday, or this coming Wednesday, I suppose. And look, we need your help marketplace.org/give mart if you – I’m going to say it again so you can understand me. marketplace place.org/givesmart. If you can, we would appreciate it. We really would.
Samantha Fields: And hey, if you’re looking for a little swag, if $7 a month is in your budget, we have a liquid assets – assets. I can’t even say that. So let me say that again. We have a liquid assets mason jar mug. Wow, it really is Friday over here. It’s perfect for spring and summer drinks for the next time you join us for Economics on Tap. So that is an option if you can give $7 a month.
Kai Ryssdal: It’s kind of its kind of cute little mug, you fill it with a Bitanga and your afternoon will be over. Alright Drew let us, please. All right, the game is called Half Full/Half Empty our host is Drew Jostad. Begin.
Drew Jostad: Are you half full or half empty on adding the capability for background checks to dating apps?
Kai Ryssdal: Wow, interesting. Okay, so look, I’ve been 25 years so yeah, Sam, whatever you say I’m gonna go with.
Samantha Fields: Okay, great. I think I’m half full on that. Although I really would want to know how it works. As someone who has used dating apps recently I would be into that but curious how it would work what they would need from you.
Kai Ryssdal: Yeah, it seems to make sense. And also and look. If so, I’ve got a 14 year old daughter who anytime I say anything says “Oh Dad, that’s misogyny. What are you doing?” So please don’t take it that way. But you gotta you gotta figure that you’re gonna want a background check the dude’s more than the not dudes and so let’s just check the guys right because they’re anyway whatever don’t @ me.
Samantha Fields: I don’t know. That – people are gonna at you.
Kai Ryssdal: No. You don’t think so? All right, I mean, I don’t know maybe all right.
Samantha Fields: I mean I don’t have a problem with them doing it to everyone but I just do wonder and then you have to wonder too where’s that information going? How can people, hackers access that? I mean it is tricky, but you know I do like the idea of having a little more a little more of that on on the internet.
Kai Ryssdal: Fair enough. what Sam said. Drew number two.
Drew Jostad: Next one are you, let’s see online shopping is continuing to boom. Samantha Fields had the story for us this week. Are you half full or half empty?
Kai Ryssdal: On online shopping I’m half full. I’m half full.
Samantha Fields: I’ll be half empty on how much we all purchase online all the time and how much we’re all consuming all the time. I guess.
Kai Ryssdal: I – so two things. Yes. I totally hear that. Are we actually consuming more or are just ordering more? I guess we’re consuming more stuff. And we’re consuming – we’re consuming less dollar amount services but look e-commerce in the ability to click on something and just have it show up on your doorstep? I don’t know. 24 hours later.
Samantha Fields: I mean it is very convenient.
Kai Ryssdal: Yeah, it is very convenient and very, almost too easy. For sure. Totally get that.
Samantha Fields: Definitely almost too easy. Alright. Yeah. There we go. Drew.
Drew Jostad: Okay. AMC is using meme stock money to buy a stake in a gold mine. Are you half full or half empty?
Kai Ryssdal: Oh, my God. So AMC which a year a little bit ago, was the the the meme stock of the century with with GameStop. In the whole Reddit Wall Street best thing and it stock was up 1600% In the middle of June last year, announced this week the CEO, by the way, who has profited handsomely from his company’s meme stoc- ification and asked if they had spent $20 million to buy 22% of Highcroft Mining company, which has not this year really produced much gold, but they bought it anyway. And if you can tell me how gold mining is a core competency of a movie theater chain, fine, but I would say that publicity is the core competency of American movie chain. And
Samantha Fields: I would have to agree with that.
Kai Ryssdal: Yeah, I just you know, it’s it’s look fine. Whatever. Haha, but I’m half empty. That’s where I’m at.
Samantha Fields: I guess I’m half full just because I think it’s kind of funny, but maybe that’s too simplistic.
Kai Ryssdal: It is kind of funny. No, look, it’s totally funny. Totally funny.
Samantha Fields: We’ll take it on a Friday.
Kai Ryssdal: Fair.
Drew Jostad: Okay. Are you half full or half empty on the Netflix password sharing crack down?
Samantha Fields: Half empty on that one. I don’t share passwords, definitely not.
Kai Ryssdal: How come?
Samantha Fields: I couldn’t tell you. Kai it seems like you’re half full on that one?
Kai Ryssdal: Well, no, look, I I have no position. I honestly don’t care. But I will say that at least several members of my family who are over the age of 18 but not yet paying their own bills in full have the house password on Netflix. Oh, my God. So let’s see. It. It’s Netflix. It’s HBO. It’s Disney Plus. And and Hulu. Right. I mean, so look, I’m as guilty as the next person. So.
Samantha Fields: I think literally everybody is.
Kai Ryssdal: Everybody. So it’s so interesting.
Samantha Fields: I just don’t know how they’re gonna claw it back, right.
Kai Ryssdal: Right. Right. Right. And Savannah Maher did the story first this week and the challenge is, look, it’s it’s money literally left on the table by these companies. But at the same time, you know, they want people to watch their content and buzz and all this jazz. So it’s hard. I don’t know.
Samantha Fields: And they’re also all doing pretty okay, right?
Kai Ryssdal: Right. Oh, god. Yeah. You kidding me?
Samantha Fields: I mean.
Kai Ryssdal: Yes, more than okay. More than okay.
Samantha Fields: So half empty on that one for sure.
Kai Ryssdal: Drew, what else we got? Fair enough. Fair enough.
Drew Jostad: I think that we might already know how Kai feels about this one. But are you half full or half empty on being a famous enough public radio host to have a cardboard cutout of yourself?
Kai Ryssdal: Shut the – So look, let me tell you this story. So here’s why Drew was mentioning that. This week, somewhere in my Twitter feed, somebody at a public radio station, somewhere across the country took a picture of themselves with a cardboard cutout of me that was taken like 10 years ago. And what happened was this J.J. Yore, the guy running Marketplace at the time came to me and said, “Hey, let’s take a life size picture of you put it on cardboard and send it out to the top 25 public radio stations in the country. And they can use it as marketing and it’d be a great idea” and I being an idiot said “sure fine, whatever for the glory of Marketplace. That’ll be fine.” So I did it. They printed it out. Number one, I look like I’m seven foot five. It’s crazy. I’m just not that big and burly.
Samantha Fields: Hey nothing wrong with that.
Kai Ryssdal: But number Well, fair enough. But number but number two, these things haunt me. They come up in my Twitter feed probably two or three times a year I think the people at Michigan – Bridget you’re gonna have to back me up the people that Michigan like put me in a yoga pose like bending over backwards and somebody somebody else does it like, like they put me in a in a cubicle, and they kind of they kind of do like this and they show me peeking over the top of the cubicle and it’s really weird. Anyway, so look, I’m glad everybody in public radio has fun with those but kill me. Kill me.
Samantha Fields: I don’t know. I’m half full, but probably because there’s not one of me.
Kai Ryssdal: Yeah, that’s what I’m saying. That’s what I’m saying. It’s all fun and games until it’s a seven foot five picture of you. That’s what I’m saying.
Samantha Fields: I’d agree.
Kai Ryssdal: Yes. Oh man that mercifully is the end of this podcast. Kimberly and I are back on Monday. If you’ve got any burning questions, thoughts on the show, send them to us anything else on your mind as well. We’re always happy to hear from you. Voice memo or an email at email@example.com. Voice messages come to us at 508-827-6278. 508-UB-SMART. Those are all letters 508-UB-SMART.
Samantha Fields: Make Me Smart is produced by Marissa Cabrera and Marque Greene. Our intern is Tiffany Bui. Today’s episode was engineered by Drew Jostad. The senior producer is Bridget Bodnar.
Kai Ryssdal: The team behind the game Half Full/Half Empty and also our video by the way Steven Byeon doesn’t get enough credit for the video. He does the video everybody else helps out with Mel Rosenberg and Emily Macune the theme music for Half Full/Half Empty was written by Drew Jostad dad who can clearly do everything. The director of On Demand is Donna Tam. There you go.
Samantha Fields: We made it, it’s Friday.
Kai Ryssdal: That’s right. We made it. Cheers.
Samantha Fields: Cheers
Kai Ryssdal: Yeah exactly Flat Stanley. That’s right. I’m freaking public radio’s Flat Stanley, that’s what I am.
Samantha Fields: I’m gonna have to see one of those.
Kai Ryssdal: No, you don’t.
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