Will August bring a wave of trade deals or a hike in tariffs?

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The theme of the economic week might be summed up as, we'll see, from American public media, this is Marketplace.

In Baltimore, I'm Amy Scott in Burke Rizdahl.

It's Friday, July 18th.

Good to have you with us.

So here we are at the end of the week, a pretty interesting one in the U.S.

economy where some of the big questions about tariffs and the Fed remain TBD.

And here with us to make sense of it all, or at least as much of it as we can get to in roughly six and a half minutes, are Sudip Reddy at MSNBC and Ana Swanson at the New York Times.

Hey, you two.

Hey, Amy.

Hi, Amy.

All right.

So, Sudip, we saw this week the first real evidence that the Trump tariffs are showing up in consumer prices.

How concerning is the CPI number we got?

You know, just having evidence is so important right now.

The signs were limited.

There are some in toys, in furniture, in some apparel.

That's to be expected when tariffs go up like this.

The real question for inflation is whether these are one-time price increases, which means they could probably be manageable, or whether this starts the effect of price increases feeding on each other, which becomes runaway inflation.

We saw this take shape a little bit in 2021, certainly not anywhere close to this scale now as it was back then, but that led to a whole feedback loop that had more prices rising and labor costs rising and all these things that became just so untenable.

And the Fed is still living with the consequences of that and trying to avoid having that same problem come up again.

Ana, what do you think?

I mean, for now, at least the Trump administration is promising higher tariffs starting on August 1st without many of the promised deals in sight.

What is the end goal here?

Well, you know, we've been debating that actually, and market investors have been debating that as well.

Are we going to end up with higher tariffs or are we going to end up with dozens of trade deals, right?

And it seems like many investors had been betting on the latter that some of these tariffs would be walked back.

You know, I'm really not so sure anymore.

I think recently signs have been pointing to the fact that the President is pretty satisfied with high tariff rates.

He's taken to calling these letters that he's sending countries with their tariff rates in themselves a deal

and saying, you know, I've done dozens of deals here.

So I do think we will see some more

deals

in

the weeks to come.

But we're also going to see significantly higher tariffs as of August 1st.

And as Sadip was saying, that has potential to spill over into the economy as well.

Well, let's talk about how consumers are holding up so far.

Signs, at least from retail sales that came out this week, are that people are still spending, maybe because of concerns about coming inflation.

Sadif, what's going on there?

No,

there's still so much durability in the economy.

People are spending.

Job growth has not fallen apart.

There are signs here and there that there may be softening, but maybe it's just noise.

You don't really have any deep signs of concern yet.

I think, especially with the stock market pretty much at records and a mostly stable job market, people are going to feel fine and consumer sentiment is showing that everything seems stable right now, but there are the things lurking in the background, like tariffs, like

some increases in prices that

they can feed on each other and turn into something that weighs on people across America.

So I do want to turn to the Fed this week.

Of course, President Trump stepped up his attacks on Fed chair Jerome Powell with reports saying the president was preparing to fire Powell and the markets didn't like it one bit.

Ana, bring us up to date on what's happening there.

Yeah, so earlier this week, the president was at one point waving around a piece of paper with

a letter to Powell that would fire him in front of House Republicans.

He later really backed off of that, saying that he was, quote, highly unlikely to fire him.

And it seems like the difference is really that he saw kind of markets revolt at that sentiment.

I think with Trump, you know, you never really quite know how much he's joking.

He likes to keep people guessing, but you do have to take him seriously when it comes to this threat.

It's clear that the president really does want a pliable Fed chair, and that would be a big threat to the economy.

You know, we're not necessarily at a moment where the Fed should be clearly cutting interest rates.

Like Sudeep was saying, the economy looks pretty strong.

There are these risks of tariff-related inflation in the coming months.

And if he would fire Powell, that could be a big shock to the global financial system.

It could lead to market volatility.

And then in the long run, it could also lead to higher borrowing costs for the United States.

So, Deeb, why do you think the president appeared to sort of retreat from these threats this week?

You know, there's some belief out there that the president is simply demonstrating power.

He likes to show that he's in control and that he can do things.

There's also a view that maybe he's looking for a fall guy if the economy stumbles.

And this kind of lays the groundwork to do that.

It's possible.

He's actually worried about the economy as a result of his tariffs.

Hard to really know what that means.

But

I think when you see the market reaction to this, one thing the president does understand, he understands when the stock market falls.

He understands to some extent how bond markets operate.

He's a debt guy.

He understands that.

And so

there's a line here that he's kind of dancing around.

But if you cross that line, then

the great

power here of the United States and the Federal Reserve starts looking a little bit more like Turkey and some other countries

where things get ugly at that point.

We had an experience with this in the 60s and 70s, and it took a pretty brutal period to recover from that.

And so

I suspect the president has some understanding of the risk factors here, even as he does a little bit of a show, which he tends to do.

And Ana, real briefly before we go, the next FOMC meeting is I think the week after next.

Considered likely to hold steady at current rates, but you know what will they be watching for?

Definitely, yeah, considered likely to hold steady.

If there is a cut, September looks much more likely.

You know, I think the question still right now is how much are tariffs going to

spill over into inflation in the coming months?

And how much is that going to weigh on the labor market right now you know the labor market looks pretty strong the economy looks the consumer all look you know pretty resilient but we have started to see tariffs

flow into some goods prices

and the question is just how you know how intense is that how broad does that get in the coming months and is that going to weigh on growth as well at the same time that it pushes up prices

Like I said, we'll see.

Sadib Freddy is at MSNBC, Ana Swanson with the New York Times.

Thanks, both of you, so much.

Thank you.

Thanks, Amy.

On Wall Street today, a little bit of this, a little bit of that.

We'll have the details when we do the numbers.

Early this morning, the House passed President Trump's package of billions of dollars worth of spending cuts called rescissions, sending it to the president to sign.

The clawback of federal funding will have a big impact on foreign aid programs and, yes, public media.

But some veterans of Capitol Hill appropriations fights from across the political spectrum are worried about what the rescissions mean for the balance of power in Washington and who really holds the power of the purse.

Marketplace's senior Washington correspondent Kimberly Adams reports.

The law allows the president to ask Congress to rescind funds for projects and programs the legislative branch already agreed to pay for, but there was something unusual about these rescissions, says Joshua Rowley, a research fellow at the Mercatus Center.

Only Republicans supported the rescissions package.

And so in that case, right, it was breaking the precedent of Republicans and Democrats work together to decide how to fund the government.

Usually, the parties have to work together to pass annual appropriations bills, because in the Senate, points out Bobby Kogan at the Center for American Progress, you need 60 votes to pass a spending bill.

No party almost ever has 60 votes.

So these things end up getting both parties to work and no one gets exactly what they want.

But this time, after lawmakers struck a bipartisan deal in March to fund the government, Republicans alone just voted to change it, and they did it just as Congress is negotiating the next round of funding.

Devin O'Connor is a senior fellow at the Center on Budget and Policy Priorities.

And so the question for Democrats is, how can you know that whatever deal you try to reach with Republicans won't then just be cut again in the same way that just happened?

The White House says more rescissions are coming, and the administration's fine with them passing on a partisan basis.

All of this could set up for a government shutdown in the fall if Democrats don't trust the GOP on a deal.

In the bigger picture, what's at stake is whether the representatives who we elect and send to Congress are really the ones making the spending decisions for our nation.

Philip Wallach is a senior fellow at the American Enterprise Institute.

whether in fact they get to sort of offer their opinion but then it's the president and the people who work for him that are deciding what kind of spending actually gets done.

And that, says Wallach, would be a major shift in how our constitutional system functions.

In Washington, I'm Kimberly Adams from Marketplace.

Elsewhere in federal spending cuts, big changes are coming to the Supplemental Nutrition Assistance Program, or SNAP, also known as food stamps.

Many able-bodied adults will face new work requirements, and states will have to start sharing the cost of the program with the federal government.

It's likely to result in many people losing some or all of their benefits, benefits that already don't go very far.

A new analysis from the Urban Institute finds that in 99% of U.S.

counties, SNAP does not cover the cost of a modestly priced meal.

Marketplace's Samantha Fields has more.

The average SNAP benefit is a little more than $6 per person a day.

Think about what you could buy for $6.25.

It's not a lot of money.

Hilary Seligman at the University of California, San Francisco, says SNAP is intended to be supplemental, as the name suggests.

It's the Supplemental Nutrition Assistance Program.

But she says the reality is.

Most families who are receiving SNAP benefits are actually not able to put any additional money into their household food budget.

And SNAP alone is not enough almost anywhere in the country to cover three modestly priced meals a day, meaning a meal that costs $3.41.

That's how much people living just above the poverty level say they tend to spend on food.

Stacey Dean at the Global Food Institute at George Washington University says with benefit amounts, the idea is.

The food that you can buy should be nutritionally adequate, aligned with what people are generally buying, and also also very modest, modest cost.

But the government makes a lot of assumptions, Dean says, that people have access to a low-cost grocery store and to a full kitchen, and that they basically never waste food.

SNAP benefits are set at a level where it is actually challenging for households to be able to purchase a basic, nutritionally adequate diet.

That's why many people on SNAP tend to buy cheap, high-calorie, processed food, says Elaine Waxman at the Urban Institute.

One of the biggest risks when you're shopping for food is to buy things that are perishable because you can't stretch them over the course of a month.

For a few years during the pandemic, the federal government expanded SNAP benefits and research shows that helped reduce both food insecurity and the poverty rate.

We have learned a very recent lesson on exactly what we need to do.

to improve food insecurity and help people put food on the table.

Unfortunately, we have walked away from those lessons.

By cutting SNAP at a time when food prices are more than 20% higher than they were five years ago.

I'm Samantha Fields from Marketplace.

Coming up.

All the homes in my community are off-grid, and I now own 55 acres of land.

Living the dream in New Mexico.

But first, let's do the numbers.

The Dow Jones Industrial Average decreased 142 points, 3 tenths percent, to finish at 44,342.

The NASDAQ picked up 10 points, less than a tenth of a percent, of close of 20,895.

And the S ⁇ P 500 fell less than a point, call it unchanged, to wrap at $6,296.

Chevron is finally going to be able to buy Hess for $53 billion.

An international panel in Paris ruled the competitor ExxonMobil did not have a valid claim to bid on Hess's oil fields in Guyana.

Chevron sank 9 tenths percent, ExxonMobil declined 3.5%.

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This is Marketplace.

I'm Amy Scott.

For 35 years, the U.S.

Department of Agriculture has set aside pools of funding for loans, grants, and other assistance for what the agency calls socially disadvantaged farmers, specifically farmers of color, sometimes women farmers.

This was part of an effort to address past lending discrimination by the USDA.

But under the Trump administration, the agency is ending those efforts.

It recently announced it'll stop considering race and gender in applications for many programs.

Marketplace's Savannah Peters has more on what those changes could mean.

In farming, access to capital is crucial.

More so than in many other sectors, says economist Dania Francis at the University of Massachusetts Boston.

You need lots of investment up front for land, equipment, seeds, and it's often months before farmers see a return.

If you can't get the money up front, you plant later, right?

If you plant later, you have a smaller harvest.

It can make you miss an entire season, which is almost, you know, financially ruinous.

The USDA is a key provider of low-interest loans that help farmers stay in business.

And throughout the 20th century, minority farmers were routinely denied loans at local USDA offices across rural America.

That often led to foreclosure and contributed to $326 billion worth of land loss for black farmers, according to Francis' research.

My co-authors and I considered that a conservative estimate.

The USDA's history of lending discrimination is well documented.

The agency itself has acknowledged it.

Margot Schlanger is a law professor at the University of Michigan.

She worked on civil rights issues at the USDA from 2022 to 2025 and spent time with victims of past discrimination.

You hear story after story after story about, you know, women going in and somebody saying, honey, where's your husband?

And story after story about folks saying, Latinos can work on farms, but they can't run them.

Schlinger says one legacy of that discrimination is that less than 5% of American farmers are people of color, according to the USDA's latest tally, and only 9% of farms are run solely by women.

Schlinger says targeted help was meant to repair the agency's relationship with those groups, like the 2501 program that's funded training and workshops for minority farmers since the 90s, or Biden-era debt relief for past victims of USDA lending discrimination.

Those programs were designed to both communicate and ensure that USDA really was open for business with all types of American farmers and ranchers.

She says minority farmers can still apply for USDA grants and loans, but worries that if the agency isn't actively reaching out to them, progress toward diversifying the ag sector could stall out.

We need American farms to be varied and healthy and economically viable across rural America.

In part because farming is a rapidly aging profession and younger generations of Americans are increasingly diverse.

The USDA didn't respond to an interview request, but instead sent a statement that the days of, quote, DEI-driven farm policy are over.

The agency claims that past discrimination has already been addressed.

Oh, that, I mean, that's a joke.

It's a joke.

P.

Wade Ross ranches cattle outside of College Station, Texas, and runs a community organization supporting small-scale black farmers in the state.

He says many struggle to scale up and truly break into the business after being locked out of financing and ag markets for over a century.

There's no commercial farmers who look like me out here.

I'm telling you that we're on the outside looking in.

Ross says the USDA's announcement sends a disappointing message, but it won't have much direct impact on the small-scale farmers he works with.

He says USDA programs targeted at disadvantaged producers mostly benefited the small number who had managed to achieve commercial success, like that recent round of debt relief, which wasn't much help to struggling farmers who were unable to secure loans to begin with.

Why would you have debt relief when you don't have a farm operation?

Or a big enough operation to qualify for loans.

He says the barriers to entry for farmers of color are deeply rooted and hard to overcome, especially without the federal government on board.

I'm Savannah Peters for Marketplace.

In the housing market, sellers have had the upper hand for years thanks to the low supply of homes for sale.

But as you've heard on this program, and according to recent data from the mortgage technology firm ICE, things might be turning in the buyer's favor.

Housing inventory has been rising over the past year, up 29% in June, year over year.

Of course, everyone is looking for something different.

And even with more to choose from, that perfect house can be elusive.

Which brings us to the latest installment of our series, Adventures in Housing, where we're hearing from first-time homebuyers.

My name is Laurel Santos.

I am a 40-year-old first-time homebuyer buyer in Trace Piedras, New Mexico.

All the homes in my community are off-grid.

And I now own 55 acres of land.

I live in an adobe home with 12 solar panels.

I have my own water tank.

I have cisterns for water collection.

I have my own septic tank.

I pay for internet, but otherwise, no utilities for me.

I'm a big city girl.

I've never thought I would ever live off-grid in my entire life.

I mean, I like hiking just fine, but I'm not that outdoorsy of a person at all.

I closed on my house for $400,000,

but my goal was never to test out the housing market at all.

I initially just needed a little kind of a few days off work and away from everything.

So I stayed in an earth ship, a traditional earth ship, in an entirely off-grid neighborhood for, I think it was a long weekend.

I checked in Friday night, left Monday morning, and I go, wow, what an amazing place!

Got an amazing view of the mountains and started being really curious about kind of off-grid living, just like how much it is to buy a place.

So a realtor sent me this place and I saw the price and I couldn't say no to it.

I'm trying to make this as 2025 as possible, but it is definitely sometimes feeling a little 1800s over here.

The person who had lived here before hung their clothes to dry, and I'm very busy and not ready for the little house in the prairie life that much.

And so had to have someone come out to install a vent for my dryer.

I had to give up getting grocery delivery, kiss, kiss two-day delivery goodbye on packages.

I now have a P.O.

box and have to drive 30 minutes to go to the grocery store and pick up my mail.

But I gained a dog park essentially and have gained a lot of peace of mind.

I think there's something to be said about when you stay in a place that is actually silent.

When you live in a city, even a small city, there's traffic, there's street lights, there's things that kind of infiltrate your space all the time.

And I'm literally in a place where it's silent.

I hear crickets, and not even that sometimes.

This is my first summer here.

I don't have AC.

It's been kind of a warm summer, and I'm a little concerned about solar and the sun intake during the winter months when there are snowstorms.

But we're just rolling with it.

We're just gonna see how it goes.

Laurel Santos at Tres Piedras, New Mexico.

We can't do this series without you, so whether you're looking for your first place downtown or somewhere a bit more remote, please tell us about it.

Marketplace.org/slash adventures in housing.

This final note on the way out today, courtesy of the Hollywood Reporter.

For the first time since Nielsen started tracking TV viewing by platform four years ago, over-the-air networks made up less than 20% of overall viewing last month.

Streaming accounted for 46%, a new monthly high, with cable at just over 23%.

Overall, TV watching grew by 3%, with kids and teens home from school, and you know how they're watching videos.

The biggest streaming service by share of viewers, YouTube, with 12.8%.

Our theme music was composed by BJ Lederman.

Marketplace's executive producer is Nancy Fergali.

Joanne Griffith is the chief content officer.

Neil Scarborough is the vice president and general manager.

And I'm Amy Scott.

Have a great weekend.

We'll be back on Monday.

This is APM.

The Trump administration is making deep cuts to education research.

The cancellation notices started coming.

When the contract is cut, the study just dies.

It's all happening just as schools are trying to make use of research to improve reading instruction.

There would not have been a science of reading without the federal funding.

It wouldn't have happened.

I'm Emily Hanford on our new episode of Soul to Story: What the Trump Cuts Mean for the Science of Reading.

Go to your podcast app and follow Soul to Story.