The recession that’s always six months away

Make Me Smart March 7, 2024 Transcript

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Kimberly Adams 

All right, we can begin.

Kai Ryssdal 

Hey everybody, I’m Kai Ryssdal. Welcome back to Make Me Smart, where we make today make sense.

Kimberly Adams 

And I’m Kimberly Adams. Thank you for joining us on this Thursday, March the seventh.

Kai Ryssdal 

We are going to do what we do on Thursdays. Listen back to some of the big stories of the week. We obviously have audio lined up, so that we can actually listen, as can you. And then, we’ll talk about them a little bit. Here we go. Drew let’s hit it.

Jerome Powell

“There’s no evidence, or no reason to think that the US economy is in or in some kind of short-term risk of falling into a recession. Having said that though, there’s always, you know, a possibility, a meaningful possibility that an economy will fall into recession. I don’t think that that possibility, though is elevated at the current time.”

Kai Ryssdal

Let me go one further than the Chairman of the Federal Reserve. One Jerome Powell. That was him yesterday on Capitol Hill. He’s there again today, his semiannual monetary policy report to Congress. There is going to be a recession. It just happens. That’s the way it goes. You have contractions and expansions. Contractions and recessions. They come. But we’ve been talking about a recession now being six months away for a year and a half. And chair Powell and the rest of the Fed says we’re not looking at it right now. Economy’s healthy, it’s growing. Inflation is slowing a lot actually. And the chair, you know, was saying what he always says. My favorite part of that whole thing. This is the yesterday part. The testimony in front of the House Financial Services Committee. Today is the Senate today being Thursday. Yesterday, he was asked whether or not there’s going to be some announcement by the Fed that the soft landing has been achieved. And if you’ve seen Jay Powell ever in public, you know that his answer to that will be no sir. No, no, no. We’re not doing that. We’re just to keep our heads down and do our jobs. So yeah, that’s Jay Powell.

Kimberly Adams 

Yeah, if only everyone else could be so, shall we say, circumspect? Anyway, on to our next clip. So, this week, I reported a story on how campaigns are spending on advertising for this election cycle. It was sort of timed to Super Tuesday. And this clip is a little bit of extra tape from an interview I did from that story. I was talking with Nicola Ovadia at BIA Advisory Services, which forecasts local media spending.

Nicole Ovadia

“What we’re seeing is a significant amount of money being spent on raising more money. So essentially, we’re seeing a lot of advertising in markets that wouldn’t normally see a lot of political advertising, say New York and California like truly red or blue states that you’re not really looking for, quote, independent voters or votes. What you’re looking for is more money, so that you can go and spend dollars in markets that are contested.”

Kimberly Adams

So, this was so fascinating to me because I was trying to square something I had heard from the Wesleyan Media Project, which is that advertising volume, political advertising volume kind of fell off a cliff after New Hampshire because Trump doesn’t really need to spend money on ads. A, because the media gives him a ton of press by himself, but also because he didn’t have any meaningful opponents in the Republican primary. Biden didn’t have any meaningful opponents in the in the Democratic primary. Therefore, in all of these primary states, these campaigns didn’t need to run ads. So, I was like, oh my gosh, these local TV stations that, you know, need those political ads for the latest live truck or whatever, are going to be screwed because, you know, this isn’t going to happen. There’s going to be a drought of advertising until, you know, closer to the fall or after the conventions. And they’re like, oh no, no, no, no, no, no, there’s plenty of advertising. It’s just advertising asking for money. And some of those ads are on TV, trying to raise support, you know, for a Pac or a Super PAC or something like that. But most of that advertising is happening on social media. And that’s what we’re going to continue to see it. Because social media is much more effective for fundraising, because you can just click through and donate.

Kai Ryssdal 

I realize I’m tempting fate, as I say this, but I’ve seen relatively little political advertising either in my Twitter feed or my Instagram feed.

Kimberly Adams 

So, that must mean the algorithm.

Kai Ryssdal

Yeah, yeah, somehow. I don’t know.

Kimberly Adams

You are very unlikely to donate. You’ve probably never donated to, you know, political campaigns. So, you’re not going to exist on those lists. I get tons of targeted ads because I actively signed up for emails, you know, so I’m always getting political advertising. So yeah, that’s just what the algorithm thinks about us.

Kai Ryssdal 

Algorithms rule our lives. All right. Moving on. This next one is Josh Brown. He’s the CEO of a wealth management company in New York called Ritholtz Wealth Management. He’s been on Marketplace a couple of times, along with his boss, Barry Ritholtz. This is Josh on CNBC talking about New York Community Bank. We’ve talked about that a couple of times. Here’s Josh, on what that could mean for regional banks lost long term.

Josh Brown

“When you have so many banks that each have their own issue, pile up, eventually, it stops being a one-off situation. And it starts to be something where we start using the term systemic more. So, I don’t think we’ve gotten to that point, but it just reintroduces that fear back into the conversation after a full year since the last go round.”

Kai Ryssdal 

I do believe that’s what I’ve been saying. It’s been a year now since Silicon Valley Bank. The best part of this whole New York Community Bank story is that yesterday. I can’t even believe I’m saying his name again. Former Secretary of the Treasury Steve Mnuchin and associates put more than a billion dollars into New York Community Bank to shore it up to get it its capital reserves and its equity requirements. I just love that so much. I love that so much.

Kimberly Adams 

Sometimes, I remember one time, when he when he was actually the treasury secretary. I was at some friend’s house and we were watching “The Lego Movie” and I made them continue to watch the credits. And they’re like, Oh my gosh.

Kai Ryssdal 

For those of you not in on the joke, Mnuchin has produced a bunch of movies too. He made his original fortunate at Goldman Sachs, then got out and does private investing and blah, blah, blah and started producing movies. Yeah, that’s wild.

Kimberly Adams 

So, watch the credits on “The Lego Movie.” There’s a former treasury secretary in the credits. All right, one last one for today. Let’s hear it.

AI Kimberly Adams

“From American Public Media. This is Marketplace Tech. I’m Kimberly Adams.”

Lily Jamali 

“That was an AI generated version of Kimberly’s voice from the deepfake stone age of 2022. Here now is what software can produce using a 30-second sample of Kimberly’s voice today.”

AI Kimberly Adams 

“From American Public Media. This is Marketplace Tech. I’m Kimberly Adams.”

Kai Ryssdal 

Almost spit on my coffee yesterday morning when I heard this.

Kimberly Adams 

Really?

Kai Ryssdal 

Yeah, it was wild. I was like, oh my.

Kimberly Adams 

Yeah, so this is from the first episode of a new series I’m working on in collaboration with our show Marketplace Tech, as you just heard. And it’s called “Decoding Democracy.” It’s on YouTube and host Lily Jamali and I talk about deepfakes and how they can impact the election. And one of the things that, you know, immediately came to mind and Daniel Shin came up with this. Producer Daniel Shin, who occasionally does Half Full/Half Empty for us, came up with this idea because when I was hosting Tech back in 2022, he booked this interview with someone who literally we had to give him a bunch of like minutes of my voice, and he ran it through this very complicated software that you had to be part of the university or this company to use to get that grainy little version of my voice. Daniel made that second clip with an online tool available to everyone that costs $5 a month with just 30 seconds of my voice.

Kai Ryssdal 

What’s amazing is how lousy that first one sounded, right?

Kimberly Adams

Yes.

Kai Ryssdal

And it was like two years ago? Come on.

Kimberly Adams 

Two years ago. Yeah, yeah. So just a reminder, you cannot trust your own ears anymore. And you know, if you watch the episode, you’ll hear some of our tips for what to do if you think something might be a deepfake or you know, sort of the best we can guess on how to spot them. Anyway, that is it for today. If you want more Make Me Smart in your life, which you definitely should, we have a newsletter. This week, I am sharing anime recommendations for everybody who has been asking and when you sign up, you’ll get a free copy of our latest cocktail zine. So, this is like all of the Kimberly things at once, which includes plenty of drink recipes for you to get ready for Economics on Tap tomorrow, which is our weekly happy hour episode. You can sign up at marketplace.org/smarter.

Kai Ryssdal 

I’ve got the day off tomorrow. Kimberly and Sabri Ben-Achour will be holding down the fort. YouTube livestream as always 3:30 Pacific, 6:30 Eastern. Do not miss it. If you have to, I suppose you can because I am but don’t.

Kimberly Adams 

You can listen later. Make Me Smart is produced by Courtney Bergsieker. Audio engineering by Drew Jostad. Ellen Rolfes writes that amazing newsletter we were just talking about. And Thalia Menchaca is our intern.

Kai Ryssdal 

Marissa Cabrera is the senior producer of this podcast. Bridget Bodnar, across the soundproof glass from me in the control room keeping an eye on things, is director of podcasts. I think she doesn’t trust us. Francesca Levy is the executive director of Digital. Now she’s giving me a stink eye.