Stress-Googling “recession”? You’re not alone.

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Speaker 2 You know the business cycle, right? Expansion and contraction.

Speaker 2 What's another word for economic contraction?

Speaker 2 From American public media, this is Market Flats.

Speaker 2 In Los Angeles, I'm Kai Risdall. It is Tuesday today.
This is is the 18th of March. Good as always to have you along, everybody.
You've heard the chatter out there, haven't you?

Speaker 2 Maybe even joined in a bit that, you know, maybe with the tariffs and the chaos and the markets and all of it, that maybe there's a recession coming? I mean, maybe there is. We don't know.

Speaker 2 But it sure would be handy to know what to look for, wouldn't it? The telltale signs? Here's Marketplaces, Kristen Schwab.

Speaker 4 Before we get into what's at play in the economy right now, let's remind ourselves what's been happening for the last few years, or even the last few months.

Speaker 4 Samuel Zeif is global macro strategist at JP Morgan Private Bank.

Speaker 5 A lot of the risks to the U.S. economy were to the upside.

Speaker 4 Upside, because since the COVID recession, which lasted just two months, he says the economy has been hot, a little too hot, with strong GDP growth, a strong job market, and strong consumer spending.

Speaker 4 And those measures have continued to mostly hold up.

Speaker 4 So much so that in this story about recession indicators, I shouldn't even really run you through the classic red flag predictors like rising unemployment or an inverted yield curve showing up in the bond market.

Speaker 4 The hard data actually point to a strong economy.

Speaker 5 Where we are seeing some signs of softening is in soft data. Sorry to use the word twice.

Speaker 4 Soft data is more about you, the consumer, how you feel and how you respond to how you feel.

Speaker 4 Because maybe up until recently, you were grumpy about all the inflation stuff, but now it seems anxiety has reached a new level, as in Googling, Are We In a Recession, from your bed at 2 a.m.

Speaker 7 The risk was there before, but it's much bigger now because of the tariffs.

Speaker 4 Mark Gertler, an economist at NYU, says the risk is less about the tariffs themselves and more about the unpredictable trade policy coming out of the White House.

Speaker 7 What's happened is the craziest period of economic policy I've ever seen in my career.

Speaker 4 That has, as we've seen, sent the stock market tumbling, which is not enough alone to predict a recession.

Speaker 4 It is enough to make the 60% of Americans who own stocks nervous, because as we say, the stock market is not the economy, but it is real money. Bethann Bovino is chief economist at U.S.
Bank.

Speaker 9 You lost your down payment, or your children lost their down payment for that home that they really wanted.

Speaker 4 Even if you're not invested, the mood matters. The latest consumer confidence numbers showed a sharp drop in expectations.

Speaker 9 Indeed, the conference board readings did drop into recession territory.

Speaker 4 Again, no one indicator signals a recession. There's actually an organization that identifies recessions.

Speaker 4 The National Bureau of Economic Research defines it as a significant, widespread decline in economic activity lasting more than a few months.

Speaker 4 But this so-called soft data is a warning, a warning that people are worried, enough so that they're looking for signals beyond the hard data.

Speaker 4 Bovino's version of this is taking a walk and keeping tabs on her town.

Speaker 9 If you start to see more signs of business closures or reduced hours, if you start to see a lot of sales signs.

Speaker 4 It means people and businesses are actively hunkering down for whatever's ahead. I'm Kristen Schwab for Marketplace.

Speaker 2 Wall Street today, traders, I think you could say we're in the yip recession camp. We'll have the details when we do the numbers.

Speaker 2 Housing figures into the recession picture too. New residential construction going down and staying down can be a tip-off.
Can be, of course, because nothing's for sure.

Speaker 2 But the Census Bureau did tell us today that permits for new home construction fell last month, down 6.8% compared to February 2024. Builder confidence is the lowest it's been in seven months.

Speaker 2 And part of that, sure, is an interest rate problem. We've talked about that.
But it's also increasingly a tariff problem. Marketplace's Kaylee Wells breaks that one down.

Speaker 10 The tariffs are just piling onto a bigger, longer-lasting problem. Homeowners don't have good reasons to sell.

Speaker 11 Why do that? You know, I've got a nice, low interest rate. I got nice monthly payments.
That's mainly the force behind that.

Speaker 10 Associated Builders and Contractor CEO Michael Bellaman says the tariffs themselves haven't had a major impact yet. It's the price uncertainty that's mucking with the industry.

Speaker 11 Developers or construction project owners that are thinking about pulling the trigger for a project or saying, you know what, let's wait until this settles down.

Speaker 10 Just the fear of increasing prices has already started to cause problems for architect Dan Bruhn, who's working on rebuilding homes after LA's wildfires. On a renovation job he's got now.

Speaker 12 The contractor has basically announced that they will need to have the client buy all of the appliances today, even though they won't be brought to the site in six months.

Speaker 10 Because suppliers are trying to lock in prices before they go up. Fine, except now that stove is sitting in a warehouse, gathering dust, waiting to go in a home that isn't built yet.

Speaker 12 You can't have products just sit on around and not being utilized and hooked up.

Speaker 11 And your warranty starts from that day, too.

Speaker 10 A lot of construction basics could see new price pressures, says chief economist Ken Simonson with the Associated General Contractors of America.

Speaker 13 The industry relies on a lot of Canadian lumber, on imported steel, aluminum, and copper.

Speaker 10 Which Simonson says is in the appliances, the electronics, the furniture, the lighting fixtures, and then there's specialty products.

Speaker 13 Decorative tile comes in part from Italy and from Spain. And so if we see tariffs on the EU, those might hit those particular products.

Speaker 10 Architect Dan Bruhn also says the alternative he keeps hearing to buy American instead won't help much because even if, say, a stove is assembled here, he says the components inside come from overseas and face the same tariffs anyway.

Speaker 10 I'm Kayleigh Wells for Marketplace.

Speaker 2 The unit of measure relevant for this next story is billions of cubic feet per day.

Speaker 2 The substance in question is natural gas.

Speaker 2 The Energy Information Administration says that last year, 10 major pipeline projects added 6.5 billion cubic feet per day to what's called takeaway capacity, moving that gas from where it's drilled to where it's used, or for our purposes today, from whence it's exported.

Speaker 2 Because roughly half of that new capacity is headed to Europe and other points overseas in the form of LNG, liquefied natural gas.

Speaker 2 SP Global, by the way, figures LNG export growth is going to double over the next five years. Marketplace's Elizabeth Troval has that one.

Speaker 14 This big new wave of U.S. LNG exports started in 2016.
That's after fracking revolutionized oil and gas production. Matthew Zaragoza-Watkins is with UC Davis.

Speaker 13 With the introduction of that technology, the supply curve of natural gas that was available at cost-effective prices really expanded significantly.

Speaker 14 And because natural gas plants run even when the sun doesn't shine and wind doesn't blow, natural gas pairs well with those renewables as a cleaner alternative to coal. And it's cheap.

Speaker 11 The United States has a comparative advantage over many countries in terms of our abundant supplies of natural gas.

Speaker 14 And hers is with University of Houston.

Speaker 11 We sell LNG to the global market. It goes to China.

Speaker 16 It goes to Europe.

Speaker 11 It goes to Asia and Latin America.

Speaker 14 But to get it around the world, pipelines and LNG export terminals are critical.

Speaker 14 It's at these terminals where Richard Meyer with the American Gas Association says natural gas is sent through an industrial refrigeration process.

Speaker 17 That super cools pipeline gas to minus 260 degrees Fahrenheit. And that's the temperature at which natural gas will turn into a liquid.

Speaker 17 That really condenses the natural gas, makes it very energy dense.

Speaker 14 But the infrastructure necessary to grow the LNG export market does face red tape, which is costly and time consuming.

Speaker 14 Though some of that burden should go away under Trump, says Matthew Zaragoza Watkins.

Speaker 13 The willingness of the current administration to issue permits for new LNG export terminals is going to be a significant boon to the industry.

Speaker 14 Relieving some of the regulatory uncertainty around LNG's future. I'm Elizabeth Troval for Marketplace.

Speaker 2 There are about 400,000 kids in this economy, that's up to the age of 17, who are in foster care, data from the Annie E. Casey Foundation.

Speaker 2 And many of those young people, because they never get back to their biological families or they never get adopted, are going to age out of the foster system straight into adulthood with all the challenges that adulting brings, getting a job, paying the rent, getting an education.

Speaker 2 There are programs to ease that transition, but a lot of foster youth don't know about them. And so by the time they turn 21, only 70% of foster kids have high school diplomas.

Speaker 2 Slightly more than half have a job. Less than 5% have an associate's degree or have gotten vocational training.

Speaker 2 But there are some places that are seeing better outcomes, as Marketplace's Mitchell Hartman reports.

Speaker 3 Every year, 700 to 800 foster youth in Florida reach the age of 18 or 21 with no permanent legal family. I met one of them, Ahim King, recently at the Florida State University Library in Tallahassee.

Speaker 3 He's 21, active in his fraternity and groups that advocate for foster youth.

Speaker 5 I'm on my own.

Speaker 19 Once I graduated, graduated, I turned 18, I packed my bags.

Speaker 3 And against the odds, he got an associate's degree and is now two semesters away from his bachelor's in nursing, supported by a federally backed tuition and fee waiver for foster youth, along with a $1,720 a month stipend.

Speaker 19 When I first came here, I doubted myself, especially my intelligence. Am I supposed to be here? But I just had to tell myself, like, I'm confident I got this.

Speaker 3 Kings worked all along the way to support himself.

Speaker 19 Taco Bell, race car, place, subway. I was a CNA.

Speaker 3 A certified nursing assistant. His friend, Quibiana Peoples, who was in foster care from the age of six, has just started a bachelor's degree in criminology at Florida State.

Speaker 3 As a teenager, she couldn't work to earn her own money.

Speaker 20 I didn't have the right papers to get a job, birth certificate, social security. At my group homes, there were sometimes, if you were misbehaved, you didn't even get the allowance.

Speaker 3 And what was the allowance?

Speaker 20 Do you earn $30 a month?

Speaker 3 She's been lucky getting advice from her foster mom and help from the tuition waiver and stipend. But she says.

Speaker 20 A lot of foster youth do not know about that. So they'd be like, what's the point of graduating if my college is not going to get paid for it? Who's going to pay for this? Who's going to pay for this?

Speaker 3 Fortunately for foster youth in Florida, there's an app to help them find out about the rights and benefits they're entitled to.

Speaker 3 Foster Power is the brainchild of Taylor Sartor, an attorney at Bay Area Legal Services in Tampa. She got the idea while representing foster youth in law school.

Speaker 3 They had questions, and the answers weren't in a guidebook.

Speaker 21 Am I supposed to get an allowance? I'm in a group home. One teenager was aging out of foster care soon, wanted to know about extended foster care.
What kind of benefits were going to be provided?

Speaker 3 Foster Power launched in 2023. Sartor's team just got a $400,000 grant to expand its reach in Florida and replicated in other states.

Speaker 3 Legal aid lawyer lawyer Mary Rose Maloney walked me through the app on her mobile phone.

Speaker 6 It is very colorful.

Speaker 22 Foster Power has several sections, immigration, independent living, all about court, health, education, money.

Speaker 3 In addition to providing information and legal references, the app features videos seeded with questions from foster youth, like this one about spending money.

Speaker 23 Did you know children in group home foster care must receive a monthly allowance? Did you also know that allowance can't be taken away as a form of punishment?

Speaker 24 I didn't know they weren't allowed to do that. I mean, if I knew that, I would have like $150 extra dollars to my name today.

Speaker 15 Apps and other services like Foster Power play an important role in reaching young people.

Speaker 3 Zach Laris is a child welfare expert and former head of policy at the American Academy of Pediatrics based in Washington, D.C.

Speaker 15 Young people are much more likely to pursue and follow up on opportunities when they hear about them from a trusted resource.

Speaker 3 Laris points out about 15% of federal tuition dollars earmarked for foster youth go unclaimed every year.

Speaker 3 Meanwhile, those who have aged out have lower education levels and earn about half what their peers do on average.

Speaker 3 Looking forward, Laris says child welfare advocates nationwide are worried about Republican plans to cut the federal budget, which could reduce spending on health care, education, housing, and food assistance for foster youth.

Speaker 15 Anything and everything could be on the table.

Speaker 3 Cuts to Medicaid, for instance, could impact the vast majority of foster youth who get their health care through the program. I'm Mitchell Hartman for Marketplace.

Speaker 25 Coming up, credit prices are going to start going up if these regulations stay in place.

Speaker 2 When EVs aren't just about the EVs. But first, let's do the numbers.

Speaker 2 Dow Industrial is off 260 points today, 6 tenths percent, 41,581. The NASDAQ sank 304 points, 1.7%,

Speaker 2 closed at 17,504. That was NVIDIA, mostly SP 500.
Subtracted 60 points, about 1.1%, 56, and 14. Tencent Music Entertainment Group, that's China's biggest music streaming company.

Speaker 2 Beat analyst estimates in its latest earnings, which were out today. The company's revenue up 8.2% to just over a billion dollars.

Speaker 2 The company has been, oh, look, integrating AI into its creative platforms. The company's U.S.
shares surged 15.5% today. Spotify went the other way, down 4.7%.

Speaker 5 Sirius.

Speaker 2 XM holdings softened 1.8 tenths percent. Bonds rose.
Yield on the 10-year T-note 4.28%.

Speaker 2 You're listening to Marketplace.

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Speaker 2 this is marketplace i'm kai rizdahl there's a thing that happens with commodities trading that always struck me as funny when you buy oil or copper or coffee or what have you you're usually not buying the actual thing.

Speaker 2 You're buying what are called futures, an agreement to buy or sell the actual thing at some point in the, yes, future.

Speaker 2 Because really, who wants a literal barrel of crude oil or 25,000 pounds of copper, which is the standard contract? Same goes for gold.

Speaker 2 Heavy, difficult to store securely, so people trade gold futures, which I mention because today gold hit yet another high in its recent run of them, north of $3,040 an ounce.

Speaker 2 Marketplace's Savannah Peters is on the precious metals desk for us today.

Speaker 6 Gold doesn't pay dividends. You can't spend it at the grocery store, but it's considered a safer place to park your money when other investments in, say, the U.S.

Speaker 6 stock market look like they're going south.

Speaker 16 People are seeing a lot of commercials in it running. Gold is, you know, at all-time highs.
Buy gold. There's sort of a mania.

Speaker 6 Lee Baker, president of Clarice Financial Advisors in Atlanta, has been fielding lots of client calls on this topic.

Speaker 16 You know, it feels like everything is falling down around us. Let's go to something that's tangible.
It's there.

Speaker 6 For these clients, gold just feels more real than stocks and bonds. It's not just anxious investors running up the price.

Speaker 6 Central banks are stocking up too, in hopes the investment will endure this moment of economic uncertainty.

Speaker 8 Gold has this very long track record of holding its value.

Speaker 6 Over very long periods of time, says Campbell Harvey, a professor of finance at Duke, millennia even.

Speaker 8 For most investors, their horizon is more like five to ten years.

Speaker 6 And over those shorter time periods, the value of gold can be volatile, just like any other commodity.

Speaker 6 Paolo Pasquarello, professor of finance at the University of Michigan, says gold is among several safe havens people flock to in times of turmoil. One of them, U.S.
treasuries.

Speaker 6 But right now, he says they're less appealing to some investors.

Speaker 27 Whether the money that you lend to the U.S. government is going to be returned, all of these things that are typically assumed as granted are not anymore.

Speaker 6 So, Pascarello says investors who would typically be turning to U.S. bonds are buying up gold bars instead.
I'm Savannah Peters for Marketplace.

Speaker 2 The three hottest letters in the electric vehicle industry today are B, Y, and D.

Speaker 2 The Chinese EV maker has a new kind of charging technology that it says can get a battery to 250 miles of range in just about the same amount of time it takes to fill up a gas tank five to eight-ish minutes.

Speaker 2 BYD, you might have seen, topped Tesla last year to become the world's biggest producer of battery-powered vehicles. But lest you think the EV business is all about selling EVs, well, no.

Speaker 2 Back in January, Tesla reported its 2024 results. The revenue that the company earned selling cars fell by 8% compared to the year prior.
But another smaller revenue stream rose by 54%.

Speaker 2 Sales of regulatory credits, government-issued regulatory credits. Marketplace's Henri Epp explains what they are and why they matter so much to those EV companies.

Speaker 5 Regulatory credits exist because some governments around the world want people to eventually drive cars and trucks that don't run on gasoline.

Speaker 5 Governments, including California's, which gives automakers credits for each electric vehicle they sell in the state. The farther a car can drive on a single charge, the more credits it gets.

Speaker 5 And each company has a quota of credits it needs to hit every year. Not all of them sell enough EVs to meet their mark, but when a car company falls short, it has another option.

Speaker 18 It has to buy credits from

Speaker 18 another automaker that has exceeded its quota.

Speaker 5 Pavel Molchanov is an analyst at Raymond James. He says that means traditional car companies.

Speaker 18 are going to be paying for the credits from the pure electric companies.

Speaker 5 Primarily, Tesla, and more recently, Rivian. They generate a lot of surplus credits because they only make electric vehicles.
California is not the only place where car makers get credits like this.

Speaker 5 The EPA has a similar system for fuel efficiency, so does the European Union.

Speaker 5 And so selling credits to traditional car companies is a pretty easy way for Tesla and Rivian to make money, says Tom Narayan at RBC Capital Markets.

Speaker 5 A lot easier than building a car, which comes with a lot of costs. And in the end, the profit margin on that car is only like 15%, let's say.
But with a regulatory credit, it is 100% profit.

Speaker 5 Historically, credits have been one of Tesla's biggest sources of profits, says Seth Goldstein, an equity strategist at Morningstar.

Speaker 5 He says regulatory credits helped the car maker stay afloat through its early years.

Speaker 28 When Tesla's underlying business was still unprofitable, it often used the credits as a way to bridge the gap to profitability.

Speaker 5 Now, Tesla's profitable, so it's using credit revenue to offset discounts on its cars, according to Tom Narayan at RBC.

Speaker 5 Rivian, meanwhile, is still losing money on its electric trucks and SUVs, so selling regulatory credits is helping keep it afloat.

Speaker 5 Neither company responded to requests for comment, but both could stand to gain in the years ahead as California gets closer to its goal of phasing out gas cars by 2035.

Speaker 25 Credit prices are going to start going up if these regulations stay in place.

Speaker 5 Daniel Sperling directs the Institute for Transportation Studies at UC Davis, and he helped create the current regulatory credit system when he was a member of the California Air Resources Board.

Speaker 5 The future of these regulations is an if because the Trump administration is pushing to revoke a federal waiver that allows California to set its own vehicle emissions rules.

Speaker 5 But car companies will keep moving towards electric vehicles anyway, Sperling says.

Speaker 25 Even if you gutted the requirements in California, these companies can't afford to sit on the sideline with EV technology.

Speaker 13 They know they've all acknowledged this is the future.

Speaker 5 Because he says, battery technology, vehicle range, and charging infrastructure are all improving. That's thanks in large part to innovations made by Tesla, Sperling says.

Speaker 5 And Tesla has been able to innovate because it can sell regulatory credits.

Speaker 25 Tesla would have gone bankrupt without these regulatory credits.

Speaker 5 And that, he says, would have slowed down the automotive industry's transition to EVs. MHenry app for Marketplace.

Speaker 2 This final note on the way out today got this, ironically perhaps, from the Canadian Broadcasting Corporation. According to data from U.S.

Speaker 2 Customs and Border Protection, last month just over 2.2 million people came from Canada into the United States by passenger vehicle, which is by far the most popular way to make that crossing.

Speaker 2 2.2 million people does sound like a lot, yes, until I tell you that that's a full half million people fewer than came last February.

Speaker 2 Also, and related, there is almost a trillion dollars in cross-border trade between those two countries every year.

Speaker 3 For now,

Speaker 2 our digital and on-demand team includes Kerry Barber, Jordan Mangi, Dylan Mietinen, Janet Wynne, Holga Oxman, Ellen Roffas, Virginia K. Smith, and Tony Wagner.

Speaker 2 Francesca Levy is the Executive Director of Digital and On Demand. And I'm Kai Rizdahl.
We will see you tomorrow, everybody.

Speaker 2 This is APM.