Chapter 1: What does the latest inflation data reveal about the economy?
Inflation is going up. And our mood? Well, you could say that's going down. From American Public Media, this is Marketplace. From Oregon Public Broadcasting in Portland, I'm Rima Grace in for Kai Risdahl. It is Friday, April 10th. Good to have you with us. You've probably seen or heard the headline by now. Inflation is at its highest level in nearly two years.
According to the Labor Department, consumer prices in March were up 3.3 percent from a year ago.
Chapter 2: How has long-term unemployment changed in recent years?
To help make sense of these numbers and a lot more, let's jump into our Friday wrap. I'm joined by Sudeep Reddy from MSNOW and Rachel Siegel with The Washington Post. Hey, you two.
Hi, Rima.
Hey, Rima. All right, let's talk inflation. Y'all read the inflation report this morning. In one sentence or maybe just in a few words, tell us, what were the vibes? Sadiq, you go first.
This was not pretty.
Chapter 3: What challenges do long-term unemployed individuals face?
Obviously, inflation going up this high, highest.
I think we lost you there. How about you, Rachel? Why don't you go? Yeah, I have a feeling that Sadiq was... Just about to get into this, but I think some of the adjectives that came up might help us, you know, get a sense of how the inflation report came across. There were a lot of words like worst and biggest and largest monthly gain tossed around.
And those are often not the kinds of words you want to see pop up when you're talking about the prices that people are feeling day in and day out. It wasn't a huge surprise that a lot of that was driven by energy costs, which is something that people are especially feeling in their pocketbooks. But
Chapter 4: Why is long-term unemployment on the rise?
I think that was a quick sense of the mood that the report delivered today. That sounds about right. Sadiq, are you back on the line?
I am, yes.
Oh, great. I think we lost you there. What were your first reactions? What are the vibes of this report?
Yeah, it's obviously concerning to see inflation shoot up less, but we've been expecting this for a while. The last few weeks have been pretty ugly for what people have been seeing at the pump.
Chapter 5: What strategies can job seekers use to stay motivated?
But everything obviously depends on how long the war lasts and whether we see a correction in oil prices and gasoline prices. And if that happens, then this could just be a blip.
Yeah. Rachel, there was this moment, you know, a year or so ago where it felt like the Fed was close to achieving that soft landing. But now I don't know. Look, things are looking pretty rough. Do we think that 2 percent target is just a far off dream at this point? Yeah, I mean, we're now coming on, what, five years of inflation being above the Fed's target.
And it's not for lack of trying to get there by any means. But it is hard to envision a world where the Fed is able to keep cutting if inflation is, you know, A, moving in the wrong direction and B, just not making the kind of progress that they want to be seeing.
Chapter 6: How are consumer sentiments affecting the economy?
And so... It doesn't mean that that kind of soft landing is impossible to achieve. But here we are again talking about whether this kind of increase is a blip if it's going to start to seep through broader inflation as opposed to just staying more confined to oil markets.
And that basically leaves them in the same kind of conundrum that they've had for a long time about balancing the risks that can pile up in the labor market side and can pile up on the inflation side quite quickly. Right. Well, Sudeep, I mean, is there anything the Fed can do while they're looking at these numbers? Like how much control do we think the Fed really has these days?
The Fed has very little control, obviously, over the issue of global oil markets, and they certainly have no control over a war. They do have the ability to look through this. The Fed chair, Jay Powell, has been clear that a single surge in gasoline prices, that's a one-time increase.
Chapter 7: What role does shelter inflation play in the CPI?
That's not persistent inflation. And they are... so far treating it that way. What we don't know, of course, is how long this is going to last. We've had some White House officials today out there expressing some doubt about whether the Strait of Hormuz is going to open up all that quickly, maybe a couple of months. And that becomes a much bigger problem.
It becomes perhaps even more of a growth problem for the Fed than an inflation problem in the near term with consumers being stretched and unable to stay afloat. So there are a lot of cross currents here for the Fed to be worried about.
Well, let's talk more about the consumers. So the consumer sentiment came out today.
Chapter 8: How is composting being approached in states with waste management issues?
Not so great at a record low. Not a huge surprise there that people are feeling pessimistic. At the same time, inflation expectations, they're creeping up. Rachel, tell us what people are actually seeing out there that's shaping the mood right now. I mean, we've seen this before after Russia invaded Ukraine that gas prices end up being a billboard for the way the economy is faring.
And when you see in so many parts of the country the price for a gallon of gasoline compounding day after day after day, that has a real psychological impact on top of the impact when people are actually filling up at the pump and having to insert their credit card.
And we know that people, you know, react with their vote on this affordability, especially when it came to the basics like housing costs and gas and food played a major role in a how people felt and be how people voted in the last election.
And I think we can expect that that is going to remain a really prevalent part of the midterm conversation unless people start to feel real relief, not just in the current price level, but something that feels like it's actually going to stick. Yeah. Well, you know, Sadiq, you know, sticking with oil for a second, prices keep climbing, right?
The straightforward moves is effectively locked down during this shaky ceasefire. And we've gotten used to a world where oil moves pretty reliably around the globe. Now that we're starting to see fractures in that system, what might that mean long term for prices and the broader economy?
It certainly means that there will need to be more supply built into the system, more reserves built into the system, more safeguards, more backups. Look, the Strait of Hormuz, this has almost been lore, the idea that the Strait of Hormuz It could be closed at any point. Everybody just thought it was so unbelievable, so crazy, the notion.
And now we've gone weeks and weeks and weeks with this being closed, and it hasn't necessarily led to an absolute crisis. We're probably not that far from one, where some of the last shipments of oil… that would have been reaching Europe and Asia have already arrived, and they're going to start dealing with shortages.
And so I think when you get into actual energy shortages, when people aren't able to fill up, not just a price issue, but an actual supply issue, that's going to be the big wake-up call for a lot of countries about where they're sourcing their energy from. And it in some ways may mean coming up with backups with with countries that they normally wouldn't want to be dealing with.
And in other cases, it might mean accelerating the move away from oil as much as possible.
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