Chapter 1: What recent changes have occurred in the U.S. trade deficit?
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So please become a Marketplace investor today at marketplace.org slash donate or just click the link in our show notes. Well, let's see. The bond market, international trade, the satellite business. And hey, when was the last time you made a new friend? From American Public Media, this is MarketPlex. In Los Angeles, I'm Kai Risnell. It is Tuesday. Today, this one is the 5th of May.
Good as it always is to have you along, everybody. You know that thing I say sometimes, that if you want to know what the economy has in store for us, look at the bond market? Yeah, well, that. The yield on the 30-year Treasury bond, that is to say the interest the government's got to pay to borrow money, is higher today than it has been in almost a year.
Marketplace's Kristen Schwab gets us going with the bond market tea leaves. It's not so much that a 5% rate on the 30-year Treasury equals a five-alarm fire. It's more like one of those psychological thresholds. Frank Warnock is a professor of business administration at the University of Virginia.
I think more significant would be if we spend time north of 5%, if it breaks through and starts to be by 5.5%.
Still, even a short stint at 5% comes with real-life consequences, especially since the 10-year Treasury yield is also hovering around highs for the year. Higher yields mean higher borrowing costs.
30-year mortgage rates, for example, or 15-year mortgage rates, or car loan rates.
What a 5% yield on the longest-term government bond says about the economy is that investors are worried about the war and oil supply and how they will affect prices. Adam Abbas is head of fixed income at Harris Oatmark.
I think the 30-year is really about structural inflation expectations. Are they kind of more entrenched?
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Chapter 2: How are bond yields affecting the economy?
And then defense equipment was another area of strength.
Still, the trade deficit did widen a bit in March. And that's because while exports rose, imports rose even more, driven by demand for computer equipment to run AI data centers, also passenger vehicles and other consumer products. which is good news, says nationwide economist Oren Klatchken.
It shows that consumers continue to spend, businesses continue to dole out capital.
The trade deficit is likely to hold pretty steady in coming months, predicts Mary Lovely at the Peterson Institute for International Economics. Tariffs aren't causing wild swings in import flows like they did last year, and U.S. demand for imports remains strong.
So the deficit overall is not going away. It's moving.
China has fallen from the top exporter to the U.S. to number four, behind number one Taiwan, which supplies us with AI equipment, and also Vietnam and Mexico, where companies are moving more production to supply the U.S. market. I'm Mitchell Hartman for Marketplace.
Among the many slices of this economy affected by the president's war with Iran is what's known as the Earth Observation Industry. And one of the biggest names in it, a company called Planet Labs. Krishnakara wrote about it for Bloomberg the other day. Thanks for coming on the program. Thanks for having me on. Appreciate it. I learned a new phrase today reading this piece.
The Earth Observation Industry. What is that? Sure. So, you know, I don't think everybody knows this maybe, but there's satellites that are orbiting Earth and they're taking pictures of what's happening on the ground every single day. And governments have been doing this for a long time.
This industry kind of came out of the government, but now there's a, you know, a whole commercial sector that's launching satellites, beaming imagery down. It's a $5 billion industry about globally speaking. And Planet Labs is the biggie, yes?
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Chapter 3: What factors contributed to the rise in U.S. exports?
He first came in five or six years ago when he was in his mid-50s.
I was incarcerated, tied to that circle in and out, and I thought maybe I'd just start looking into some of the resources that's available and see where it could lead me.
He told his advisor then that he was interested in vocational training, and they got him into a program to get his commercial driver's license.
They funded everything, like really helped me get that opportunity to get into a new future.
But without much on-the-job experience, Anderson says it's been hard to land steady, full-time work at a good company. Right now, he's only working one day a week and not as a driver.
It's been challenging trying to get a job where you can say, thank you, God. You know what I mean? I'm good now and I got the stress. That kind of work, yeah, it's been challenging for me.
It's challenging for a lot of people to find work right now. Elizabeth Gidding sees that every day, working one-on-one with people to help them find a job or get into an apprenticeship or training program. When I do an orientation for the individuals to get a workforce advisor, the room is packed. So I know the economy is pretty bad.
And those one-on-one appointments people can make with her or another advisor are booked until June. A lot of people are just becoming layoff. And I see individuals that come in that have been laid off since last year, the early part of the spring, and they still have not obtained employment. Philadelphia's unemployment rate has risen from about 4.5 percent in December to 5.3 percent in January.
Patrick Clancy, the CEO of Philadelphia Works, says it's consistently higher than both the state and national average.
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Chapter 4: Why did the U.S. trade deficit widen in March?
Yeah, so 222, I can tell you in U.S. dollars, it's $22.22, so that's kind of cute, per month. Kind of cute, yeah. A little too on the nose, actually, but you know, whatever. Time left, I can tell you it's 25 Canadian, so that would be something smaller, USD, but then you can get a three-month or a six-month package, and then that lowers the price even more.
But then, of course, none of that includes the cost of the dinners. Right, right, right. So that's just the buy-in, as it were. Exactly. Right. You have a great line in this piece talking about reducing a human problem, finding a friend, right, to an interface and a price point.
And boy, does that take the romance and then, well, not romance, wrong word, but that takes the sort of human element out of a lot of what's happening here if you're finding a friend. Absolutely.
And it's interesting because I think that these platforms, part of the appeal and part of why people want to pay for them is because they do have that illusion of authenticity and kind of spontaneity where you're not seeing, like with something like Hinge or Tinder, you're actually seeing that mechanical process and you're part of the process where with Time Left or 2-2-2, you get to kind of buy into the illusion of, oh, this is just happening naturally, but in fact, it's a sort of technological process working behind the scenes.
Yeah, you alluded to it a minute ago, but you're done with these things, right? You'd go back if you had to, but for now, you're fine without it? Yeah, I would say ultimately not for me. I do think that that kind of solo travel use case was the one that was most appealing to me in terms of if I could ever see myself on these platforms again. But I think barring that, probably not.
Amara Hashim-Steele, she's an editorial fellow at The Walrus. Thanks for your time. Thank you. This final note on the way out today in which quarterly earnings season looks set to become a semi-annual earnings season.
Today, the Securities and Exchange Commission, as has long been rumored, I must say, proposed a new rule that would let publicly traded companies report their financials once every six months instead of once every three. Increased regulatory flexibility is the phrase that SEC Chair Paul Atkins used. Jordan Manji, Zanil Maharaj, Janet Nguyen, Olga Oxman, and Virginia K. Smith are the digital team.
I'm Kai Risdahl. We will see you tomorrow, everybody. This is APM.
Headlines shift overnight and then again in the afternoon and again in the evening. You see where I'm going with this. Hello, I'm David Brancaccio, special correspondent for Marketplace, where we deliver economic news designed to keep you both sane and informed. One of my favorite ways to make sense of it all is with the Marketplace newsletter.
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