What's really going on in the Trump economy?

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Speaker 4 What's really happening in the Trump economy? The headline numbers don't tell the whole story. From American Public Media, this is Marketplace.

Speaker 4 In Denver, I'm Amy Scott in for Kai Rizdahl. It's Thursday, August 28th.
Good to have you with us. First, the headline: the U.S.

Speaker 4 economy grew faster in the second quarter of the year than previously estimated. The Commerce Department said today gross domestic product from April through June grew at a revised 3.3%,

Speaker 4 adjusted for seasonal factors and inflation. That's higher than the 3% officials estimated last month.
Revisions are standard business with GDP as more complete data becomes available.

Speaker 4 We'll get a third estimate next month. But the fine print is pretty important on this one.
Marketplace's Matt Levin has the story.

Speaker 3 What's that post office slogan again? Neither snow nor rain nor gloom of night will stop you from getting an American Express offer in your mailbox today? Well, economic data doesn't work like that.

Speaker 3 When a massive storm hits the Gulf Coast or a polar vortex freezes the Midwest, jobs numbers or retail sales may be misleading. And after April 2nd, Hurricane Tariff Palooza made landfall.

Speaker 5 It would be like another storm of sorts,

Speaker 5 and it certainly had an impact on GDP without any question.

Speaker 3 Charles Lieberman is chief investment officer with Advisors Capital Management.

Speaker 5 It's visible. You can see how much

Speaker 5 imports were distorted.

Speaker 3 The twist here is the way GDP is calculated. GDP is the final value of goods and services produced in the U.S.
So imports are subtracted from that.

Speaker 3 When tariffs hit and imports were cut by about $340 billion last quarter, GDP went up. Although that doesn't mean the economy was booming.

Speaker 5 So these are just massive, massive numbers that overwhelm everything else. And you have to cut through that noise to get a sense of what's going on underneath the economy.

Speaker 3 If you only look at what consumers and businesses were buying this spring, GDP was still growing, but not as robustly as last year, says Brian Colton at Fitch Ratings.

Speaker 5 That suggests to us that, you know, there's clear signs of an underlying slowdown.

Speaker 3 GDP has found a partial replacement though for that somewhat slowing consumer, AI, or more specifically, big tech firms spending hundreds of billions on AI data centers.

Speaker 3 Gregory Daco is an economist with EY.

Speaker 5 We are seeing signs that investment in AI and investment in the construction of AI-related infrastructure is providing a significant boost to economic activity.

Speaker 3 Daco says he expects that AI spending to boost GDP well into next year. I'm Matt Levin for Marketplace.

Speaker 4 That data center spending Matt was just telling us was a big factor in GDP, it's enormous.

Speaker 4 When Chipmaker Nvidia reported earnings yesterday, its CEO estimated that this year alone, AI infrastructure spending will total $600 billion

Speaker 4 and reach $3 to $4 trillion by the end of the decade. All that investment is helping prop up a whole bunch of companies in construction, real estate, energy, and more.

Speaker 4 Marketplace's Nova Safo spent the day looking at where all that money is going.

Speaker 6 Data center construction started exploding hand in hand with artificial intelligence. Consulting firm McKinsey Company estimates buildouts globally will total nearly $7 trillion.

Speaker 6 Eugenio Aliman is with Raymond James.

Speaker 7 It is really difficult to compare what is happening today to other type of investment.

Speaker 6 Still, Aliman took a shot. He says it's analogous to the buildup of the internet itself.

Speaker 7 We have to go back to the end of the 1990s where we saw this very, very large investment.

Speaker 6 Back then we were building telecommunications networks. Now it's giant complexes to house servers.

Speaker 8 Projects are popping up across the country and it definitely has been an expansive market.

Speaker 6 Daryl Neapolitano has a front row seat at building materials supplier Amrise.

Speaker 6 It just made a deal with Meta to provide cement with a lower carbon footprint, an important factor for doing business with tech firms.

Speaker 8 We're focused very much on how we can decarbonize the supply chain itself and actually just meet the schedules for the projects, which are typically fairly aggressive.

Speaker 9 It's having a tremendous impact on the construction industry.

Speaker 6 Eric Gauss with market intelligence firm Dodge Construction Network says the amount of data center business for the sector has grown from the hundreds of millions in the mid-2000s to tens of billions a year.

Speaker 9 One of the things that we are forecasting is that the data center construction sector is going to be larger than traditional offices.

Speaker 6 Balancing out the contraction in that area of the economy. I'm Nova Safo for Marketplace.

Speaker 4 Wall Street today saw no contraction. We'll have the details when we do the numbers.

Speaker 4 Three Mile Island in nineteen seventy Chernobyl in 1986, Fukushima in 2011. For a lot of folks, these disasters are what come to mind when thinking about nuclear energy.

Speaker 4 But over the last five years, public and political perceptions of the controversial power source have been shifting. Reporter Jennifer Hiller wrote about it for the Wall Street Journal.

Speaker 4 Jennifer, welcome to the program.

Speaker 10 Thanks so much.

Speaker 4 The headline of your story is, nuclear power is having a pop culture moment. How so?

Speaker 10 We think what we've seen just in the last couple of years and kind of with increasing volume is that nuclear power has become popular in kind of a strange way.

Speaker 10 It's been kind of out of fashion for decades, and the last few years has really become just

Speaker 10 more a part of the energy conversation, either for just climate reasons or because we're entering an era where we need to build more power generation.

Speaker 4 You know, I cover climate, and so I'm hearing this, of course, from activists and scientists, but you write about, you know, influencers like this model, Isabel Bemecki, who's, you know, kind of made a career talking about nuclear power online.

Speaker 4 What's her story?

Speaker 11 Right.

Speaker 10 She's a Brazilian model. She lives in the U.S.
and, you know, several years ago started reading a lot about climate and had climate concerns.

Speaker 10 And then a scientist that she follows on Twitter basically put out a message several years ago about nuclear reactors. And that kind of sent Isabel down the rabbit hole of research there.

Speaker 10 And yeah, she decided to become a nuclear power influencer, which was not a thing that really existed before.

Speaker 4 And I think we have a clip from one of her TikToks. We can listen to you.

Speaker 12 I am in the control room at the Crane Clean Energy Center, formerly known as Three Mile Island Unit 1.

Speaker 12 And this is such a cool historic power plant that is now going to be restarted, which is just extremely poetic.

Speaker 12 It symbolizes all of this new excitement about nuclear and how we are rewriting the story of this very misunderstood clean energy source.

Speaker 4 Okay, so she's talking about Three Mile Island, which most of us know from a big accident in, what, 1979.

Speaker 4 you know nuclear still does have a reputation among uh folks who've been around for a while for accidents and of course waste

Speaker 4 has the industry gotten safer

Speaker 10 you know i think the industry really improved safety a lot in the wake of three mile island a lot of procedures changed at plants and um you know they're a very safety focused industry.

Speaker 10 You know, there have been some high-profile incidents. You know, Three Mile Island was the biggest sort of civilian nuclear power incident here in the U.S.

Speaker 10 You know, there was Chernobyl in, I believe, 1986 and Fukushima in Japan. And so these just were so high profile that it kind of took the luster off of nuclear power.

Speaker 10 And a lot of countries just kind of lost interest in building more plants. So we've got, you know, we've got a large nuclear fleet in the U.S.

Speaker 10 There are 93 operating plants, but we just haven't seen a lot of new additions the last few decades.

Speaker 4 Of course, what's changed in the last few years is not just concerns about the climate crisis and carbon emissions, but the rise in AI and the demand for electricity.

Speaker 4 You write that public perception has really changed during this time.

Speaker 4 You know, why do you think people are getting more comfortable with this idea?

Speaker 10 I think part of it is that things like Three Mile Island are starting to seem like they're pretty far in the distance.

Speaker 10 You know, there's a lot of people today who were not alive at the time that that happened.

Speaker 10 You know, the industry has had a pretty good safety record in the U.S. since then.
And, you know, as you mentioned, we have rising power demand because of things like AI.

Speaker 10 And so, yeah, it's just kind of entered the conversation from the tech world. And that's gotten obviously really noisy in the last year, year and a a half or so.

Speaker 4 Well, especially now that the Trump administration is taking aim at other forms of clean power, specifically solar and wind, and trying to roll back progress there, is nuclear power our best hope for reducing carbon emissions?

Speaker 10 I mean, I think that that remains to be seen. I think what the nuclear industry has to sort of answer is whether they can kind of build quickly and meet that moment.

Speaker 10 You know, the projects historically have taken a long time, they've gone over budget, things like that.

Speaker 10 And so, if you can sort of overcome that, you know, there's a lot of companies that are still working on designs and getting designs approved and things like that.

Speaker 10 But we do appear to be kind of on the cusp of, you know, something potential. It's just, it's hard to know at this point, like, how big is it going to be?

Speaker 10 Like, how much, how much market share could it really take?

Speaker 4 Jennifer Hiller wrote about nuclear power's pop culture moment in the Wall Street Journal. Thanks so much.
Thank you.

Speaker 4 Pending home sales fell in July, down almost half a percent compared to June, according to the National Association of Realtors. Those are deals under contract that haven't closed yet.

Speaker 4 And what's happening in the housing market trickles down to other industries, including interior design, which gets us to today's installment of our series, My Economy.

Speaker 11 My name is Melissa Fields. I am the CEO and principal designer of Shades of Gray Design Studio in San Antonio, Texas.

Speaker 11 I have been running my my business for about seven and a half years now, so getting ready to hit eight in January. Oh my goodness.
So I was actually in the Air Force for 20 years.

Speaker 11 That makes me feel so old when I say that.

Speaker 11 But yeah, I started out enlisted and then ended up crossing over to what they call the dark side, got my degree and then got commissioned as a second lieutenant and then retired as a major in 2018.

Speaker 11 Even though we're pretty nomadic in the military, we move a lot, especially officers. We move every like three years, depending on your job, but you still wanted to feel like your house was a home.

Speaker 11 And so I would just try to help people. I'm like, you know, we could just get a remnant.
You know, we can't put carpet in here, but let's just go to this place and get area rugs.

Speaker 11 And, you know, hey, we could do,

Speaker 11 you know, curtains. You can just take the curtain rod and just hang it up as high as you can.
It draws the eye up and like little things that they're like, what are you talking about, Melissa?

Speaker 11 Like, like, they just didn't know what they didn't know, right? So I would just try to do little things, just really trying to spruce up

Speaker 11 what would normally be a very vanilla and boring place, right?

Speaker 11 Because it wasn't yours, it was the government's, right? It was government housing. So, yeah, that's that's what I would do.
I called it my side hustle because I wasn't charging anybody for it.

Speaker 11 I just absolutely loved doing that.

Speaker 11 I'm so grateful that the Air Force provides, you know, programs for people that are transitioning from military life to civilian life. And so they would have like boots to business.

Speaker 11 So I tried to learn as much as I could, but I think the closer I got to when I was actually going to hit the retirement button was when I was like, you know what? I'm really going to do this.

Speaker 11 I have military veterans actually reach out to us and want us to design their home. When I ask, you know, why did they choose us? A lot of the times they will say, because of your military experience.

Speaker 11 It does make me a little emotional because I'm like, wow, that I don't take that lightly. That means everything to me.

Speaker 11 And so it's already whether you're in the military or not, these people are entrusting you with their home, you know, probably the most personal space in their life, right? You're...

Speaker 11 coming into their home where they're you know raising kids and it's very personal and you're in their bedrooms and their bathrooms and kitchens and things like that and so um it's it is very emotional and it it means everything to me.

Speaker 11 So I, again, I don't take that lightly.

Speaker 4 Melissa Fields, retired Air Force officer, turned interior designer, running Shades of Gray Design Studio in San Antonio, Texas. Let us know your economic story at marketplace.org slash myeconomy.

Speaker 4 Coming up.

Speaker 13 We'll go, wow, there's a charger on every corner. I guess I can now get an EV.

Speaker 4 Electric dreams, but first, let's do the numbers.

Speaker 4 The Dow Jones Industrial Average rose 71 points, just under 2 tenths percent, to close at 45,636.

Speaker 4 The NASDAQ added 115 points, half a percent, to close at 21,705. And the SP 500 found 20 points, 3 tenths percent, to end at 6,501.

Speaker 4 So how did Wall Street react to NVIDIA's better-than-expected earnings report yesterday? Pretty meth. The chip maker subtracted 8 tenths percent.

Speaker 4 Best Buy beat analysts' comparable store sales estimates and surprised everyone with a rise in sales thanks to strong demand for video game consoles, phones, and computers.

Speaker 4 Seems to be time to replace all of that stuff we bought during the pandemic, but the retailer did not raise its sales and profit forecasts for the year because of, you guessed it, tariff uncertainty.

Speaker 4 Best Buy gave back 3 and 7 tenths percent. You're listening to Marketplace.

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Speaker 4 This is Marketplace. I'm Amy Scott.
Coming back to that GDP report, the Commerce Department also gave us a preliminary read on how corporate America is holding up amid shifting trade policy.

Speaker 4 Corporate profits were up almost 2%, or more than $65 billion in Q2. That's after a first quarter slump.
Marketplace's Savannah Peters has more on what's behind the rebound.

Speaker 17 The Bureau of Economic Analysis reports corporate profits a little differently than companies themselves.

Speaker 18 The proper BEA terminology is profits from current production.

Speaker 17 Which matters, says John Blank with Zach's investment research, because it's a measure of fundamental business activity. Capital gains and losses from stocks, bonds, and other assets.

Speaker 17 The BEA strips all that out.

Speaker 9 This is actual production in the U.S.

Speaker 18 economy. You can actually manage to materially see this.

Speaker 17 Like a car lot making a sale or a construction firm investing in new equipment. And in the first quarter, corporate profits were down, says Ricardo Marto with the St.
Louis Fed.

Speaker 5 What happened was firms imported a lot of goods from overseas in anticipation for the increasing tariffs.

Speaker 17 Marto says that front-loading tipped the scale. sort of like with overall GDP, but stockpiling slowed down in Q2 and companies sold through some of that inventory.

Speaker 5 And so we see profits going back up.

Speaker 17 At a modest pace relative to recent history, according to Marto.

Speaker 17 But the rebound is a sign that corporate America is hanging in there.

Speaker 19 For now, it's the operative term.

Speaker 17 Gary Schlossberg is with the Wells Fargo Investment Institute.

Speaker 19 U.S. firms have absorbed most of the tariff increases without really damaging margins.
Real tests will be late this year, early 2026.

Speaker 17 When companies will have to choose whether to keep eating the cost of tariffs or pass more of it on to increasingly price-sensitive customers, Schlossberg says either could take a bite out of corporate profits.

Speaker 17 I'm Savannah Peters for Marketplace.

Speaker 4 It is an odd moment for the U.S. electric vehicle market.

Speaker 4 Sales and leases have been booming ahead of a September 30th deadline because after that, buyers will no longer be able to knock thousands of dollars off the purchase price with federal tax credits.

Speaker 4 Even without that incentive, though, Ford, GM, and Nissan are pushing ahead with new generations of more affordable EVs coming to the market in the next few years.

Speaker 4 The bottom line is that there will be more EVs on U.S. roads, and they'll all need places to charge.
And as Marketplace's Henry Epp reports, that's a business opportunity.

Speaker 20 Ron Matherly's main complaint about charging his 2022 Ford F-150 Lightning is that a lot of the supposedly fast chargers he's used over the years don't perform as advertised.

Speaker 20 Shortly after he bought his electric truck in 2023, he plugged it into a charger outside a mall near his Houston area home.

Speaker 21 But when he came back, I wasn't getting the 250 kilowatts per hour out of the charger, but they were still charging me the 25 cents a minute.

Speaker 20 His car had barely charged. He kept having the same problem at other chargers, too.

Speaker 21 And what that did is it caused a lot of range anxiety.

Speaker 20 The fear that if he were to drive too far from home, he might get stranded. But that changed when Tesla opened up its national network of fast chargers to other brands.

Speaker 20 He tried one at a gas station with the big convenience store attached.

Speaker 21 And in 30 minutes,

Speaker 21 I had a full charge.

Speaker 20 And while his truck filled up, he browsed the store's aisles and bought some food.

Speaker 21 Get you two different ways, so to speak.

Speaker 20 This business model may seem kind of obvious, offer reliable fast charging and something to do for 30 minutes or so but it's taken a while for two big industries to really figure it out car makers have a vested interest in adopting it lauren mcdonald is chief analyst with the charging data firm perrin if they improve the charging experience they know that was critical to selling more evs one of the single biggest reasons that consumers are not adopting evs is because they're concerned about public charging then there are retailers especially convenience stores That industry woke up in the last couple years realizing, oh my god, right?

Speaker 13 If these EV drivers, you know, plug in and come inside the store, we have this captive audience.

Speaker 20 Automakers and retailers plan to add tens of thousands of plugs across the U.S. in the next few years.
The convenience industry feels like it has a head start in this race.

Speaker 22 The saturation is already there. The locations are already there.
The amenities and the attributes that drivers want are already there.

Speaker 20 Carl Donges is with the National Association of Convenience Stores. They have an obvious advantage.

Speaker 20 People are used to fueling their cars there, but he cautions gas station owners that they can't count on a monopoly.

Speaker 22 A lot of different businesses can offer electricity, including car makers.

Speaker 20 After watching the success of Tesla's charging network, more of them are getting into the game.

Speaker 23 So our strategy is to extend the Mercedes-Benz brand promise through our charging network.

Speaker 20 Andrew Cornelia is the CEO of Mercedes-Benz High Power Charging, a company created by the German automaker to build a high-speed charging network in North America.

Speaker 23 It has to work every single time. It has to be fast-charging.
But really, what we're focused on is what you do while you charge.

Speaker 20 A lot of their stations have lounges and food and canopies over the chargers, or they're next to a Starbucks or a mall.

Speaker 20 Another joint venture of eight car companies called Iona is rolling out a similar concept.

Speaker 20 Then there's a big business that could give both convenience stores and car companies a run for their charging money, Walmart. It's working on its own massive charging network led by Adam Happel.

Speaker 24 There's 4,600 or so Walmart stores just here in the U.S. We're targeting installing at as many locations as we can, knowing that it'll be literally thousands and thousands of the stores.

Speaker 20 All, he says, in the next five years. If all of these chargers get built as promised, it could be a lot easier to juice up your EV in a few years.

Speaker 20 In some parts of the country, says Lauren McDonald at the consulting firm Perrin, those chargers could even start to outpace demand.

Speaker 13 Maybe the good thing of that is those more recalcitrant buyers in those markets will go, wow, there's a charger on every corner. I guess I can now get an EV.

Speaker 20 If you build it, they will come, or at least that's what companies are betting on. I'm Henrietta for Marketplace.

Speaker 4 This final note on the way out today with a hat tip to Bloomberg. That revised GDP release we talked about throughout the show was also distributed on public blockchains.

Speaker 4 The Commerce Department said in a press release it published an official hash of its quarterly release to Bitcoin, Ethereum, Solana, and several other blockchain platforms.

Speaker 4 A hash, I gather, is a sort of digital fingerprint that authenticates the underlying data. The move is part of the Trump administration's embrace of the cryptocurrency industry.

Speaker 4 Pretty sure Matt Levin just looked the data up on an old-fashioned government website.

Speaker 4 Our daily production team includes Andy Corbin, Nicholas Biong, Maria Hollenhorst, Iru Ekbinobi, Sarah Leeson, Sean McHenry, and Sophia Terenzio. I'm Amy Scott.
Hope to see you back here tomorrow.

Speaker 4 This is APM.

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