'Tis the season for credit card debt

0:00This podcast is supported by Odoo. Some say Odoo business management software is like fertilizer for businesses because the simple efficient software promotes growth. Others say Odoo is like a magic beanstalk because it scales with you and is magically affordable. And some describe Odoo's programs for manufacturing, accounting, and more as building blocks for creating a custom software suite. So Odoo is fertilizer, magic beanstalk building blocks for business. Odoo, exactly what businesses need. Sign up at odoo.com. That's O-D-O-O dot com. Introducing your new Dell PC with the Intel Core Ultra Processor.

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1:14Did you do some holiday shopping today? And if so, how good or bad did you feel about opening up your wallet? The answer might tell us something about the state of the economy. From American Public Media, this is Marketplace.

1:37In New York, I'm Kristen Schwab, in for Kai Rizdahl. It's Friday, the 28th of November. Good to have you along. There's a lot to talk about today with the holiday shopping season officially here. Also, we got a pile of economic data this week, including reports delayed during the government shutdown. So let's dig in. Jordan Holman is at The New York Times. Rachel Siegel is at the Washington Post. Hey, you two. Hey there. Hey, Kristen. Jordan, I want to start with you since retail is such a big part of your beat and today is the day. And I'm hoping you can make some holiday shopping predictions for us because we have some kind of contradicting data.

2:16Retail sales numbers for September were out this week and kind of whatever. And meanwhile, the National Retail Federation says Americans will spend more this season than ever before. So how do you square those? It is really confusing. But I think the way to look at it is that our economy has been bifurcating for years at this point right now. And so when you see those big numbers, about a trillion dollars in sales expected for this holiday season, we have to really think that that is going to be carried by higher income shoppers. And we're seeing this across many retailers. Even Walmart is saying that a lot of its sales are driven by higher income shoppers.

2:57When you think of higher end department stores like Nordstrom, they said that their customers are in a strong state. And Moody's even had the stats saying like the top 10 % of households are making up nearly half of all spending. So that's really what's fueling the spending. But it is kind of hiding the fact that there are a lot of people who are pulling back who are really thinking about the categories that they want to buy for for need compared to one. Yeah, well, if you're a retailer and you're looking at that K-shaped economy and you're balancing tariffs and inflation and grumpy shoppers, I mean, what do you do?

3:36You try to, you know, push as much deals as you can. But even I was looking at some numbers out today, early Black Friday numbers from Adobe, and the level of deals are pretty similar to last year. and they're not even that deep. Like 27 % is kind of where it's hovering. And when you talk to a lot of people, you think of Black Friday, 40, 50 % off. So retailers right now are really trying to protect their margins. They've spent a year trying to figure out the impact that tariffs will have on their business. And this isn't a time to just kind of give that up for these deep discounts. So they're trying to offer discounts where it's most impactful for people.

4:17And then hopefully people will buy at full price is the thinking. Well, I'm wondering, you know, you're talking about those discounts, early discounts. Black Friday seems like it's a month long now. Does that mean we're going to know a lot about the health of the consumer early? Or are we going to have to like wait for the whole season to happen to get an understanding of where consumers are? I was talking to someone in the retail industry just last week, and they were saying no one really knows how the holiday season will shape up until we're in it. And historically, today is the start of it.

4:51So it's probably still too early to tell. And also, given that we're delayed on some of the economic data, I think any reads that retailers will tell us will be really important. So any earnings reports that come out or just sometimes retailers will just say, like, this is what the first few weeks are looking at. That will be really important to getting a read because right now we're still in the dark. Yeah. Rachel, I want to turn to you and the Fed because they will have to make an interest rate decision in a couple of weeks. And it seemed like, you know, last week markets were pricing in a pause.

5:28This week they're pricing in a cut. What happened between then and now? Yeah, I mean, in a way, a week is a long time for Fed policymakers to lean one way or another. And really, we've seen a couple of things. There's been a trickle of data. We can talk about the jobs market data or what else we might be piecing together for some other reports that are delayed since the shutdown, but that are starting to come through. you're also seeing this emergence of sort of two camps within the Fed that have pulled strongly for that pause because they're worried about inflation or that are pulling more strongly for a cut because they're worried about weakening in the job market.

6:08That later bucket may have looked at the last jobs report and seen the unemployment rate tick up to 4.4 percent. They're a little bit worried about a shakier job market more so than they are widening inflation. On the other side of that coin, you have policymakers who fear that inflation is starting to spread, that they can't get a little too cozy. And so that division is really something that has kind of opened itself up as the weeks have gone by. Hmm. Well, you have the two sides of the coin, Rachel, as you're talking about. We also have a bunch of kind of old data, right, from September that we got.

6:46I'm wondering how useful is that data? And is it enough for the Fed to make a confident decision? Yeah, I mean, it's definitely not ideal, right? There's a reason that these reports come out as frequently as they do. And for years, or as long as we've all been paying attention to the Fed, there is a hard message that they go by the data. So what happens when they don't have that data? Now, policymakers are really quick to point to things that they have been looking at instead, things like regional data, or Jordan mentioned earnings reports, other ways that they can kind of piece together that picture.

7:23They also, you know, feel confident that they're not just going to be totally flying blind. But, you know, that's not the most ideal situation to be in, right? You're not going to want to piece together information when you have to make such a consequential decision. And then they're also kind of bound by their calendar. There are days every year that they have to commit themselves to these decisions. So I think they might be operating in a kind of best case scenario, but I'll definitely be curious for, you know, what answers they have in the December meeting about what information they feel that they've been able to lean on and what information they're trying to make up along the way.

7:57Well, Rachel, is there any information they might get in the next couple of weeks that could change their mind? Yeah, I mean, at a certain point, they're going to be sort of locked in, right? And slowly, we're starting to see this delayed calendar trickle out from the BLS about inflation numbers or about the jobs report. But eventually, that calendar kind of runs out and, you know, know, they'll be looking at the last last meeting of the year. But I think that, you know, in a way that policymakers might say that it's never about one specific date or a point. It's never about, you know, one specific report that's supposed to turn them one direction or the other.

8:32It's more about the totality. So it's almost like a yes, all of the above, all at once. They need they need all of those reports, especially ones that are delayed since the shutdown. But then they have to be able to make a big picture assessment. And, you know, there's a certain point where they're just going to have to make that call. Rachel Siegel is at the Washington Post. Jordan Holman is at the New York Times. Thanks, you two, and have a good weekend. Same to you. Thank you. Malls weren't the only thing open today, so was Wall Street, and it was feeling some holiday cheer. We'll have the details when we do the numbers.

9:27We were just talking about how consumers are feeling stretched this season. Here's one way it's showing up in people's wallets. Americans are leaning more and more on credit card debt. Outstanding card balances jumped to more than$1.2 trillion in the third quarter, according to the New York Fed's running tally. That's up 6 % over the same time last year. And between inflation and forecasts showing Americans plan to ramp up holiday spending this year, the debt burden is set to grow. Marketplace's Savannah Peters has more. Between gifts, travel costs, groceries for festive meals, the winter holidays are the splurgiest time of year for many Americans.

10:10And our collective end-of-year debt burden tends to reflect that. What we've seen is a big jump in credit card balances across consumers in Q4. Charlie Wise, head of global research at TransUnion, says we get more financially disciplined in the new year and usually pay that extra debt down by the end of the first quarter. It's a typical cycle that we see absolutely every year. But in 2026, consumers could have a tougher time managing that holiday spending hangover, says Ted Rossman, an analyst with Bankrate. The problem is that a lot of people already have a lot of credit card debt. Rossman says low-income Americans especially are carrying bigger balances heading into the holiday season just to cover essentials.

10:56Think about how much everything else in our lives has gone up. Your rent payment is up, your grocery bill is up, utilities, insurance, all these other things. Rossman says there'll be less fat to trim in household budgets come January, so it could take longer to catch up. And Chi-Chi Wu, an attorney with the National Consumer Law Center, says the rise of buy-now-pay-later lending adds extra risk. We see consumers sometimes get into trouble when they think, oh, well, I can deal with this payment for this one buy-now-pay-later loan to buy this item. Next thing they know, they're juggling multiple pay-in-for-installment plans for their whole shopping list and their plane ticket home.

11:39Wu says between inflation, a weakening job market, and still high interest rates, it's a precarious time to go into the red for nice-to-haves. And yet, all of the cultural messages are pushing you to do it. Christine Whelan, a consumer scientist at Emory University, says we can plan to pare down our gift list or rein in our holiday hosting budget. Well, you can talk about all the wise economic choices, Really, we're talking about values of giving and sharing. And what it means to feel like you're doing well in 2025. I'm Savannah Peters for Marketplace.

12:40These days, there is a whole genre of social media content devoted to homesteading. Story after story of people who traded in their lives in big cities to live in rural areas where land is cheaper and life is quieter. But there are also people out there making a move in the opposite direction. Here's the next installment of our series, Adventures in Housing. My name is Laura Griggs and I live in central Missouri. My husband and I and our children, we lived on a 10-acre rural American homestead for 10 years. We really were trying to figure out a way to be able to raise a family that wasn't going to cost us just gobs and gobs of money.

13:24We really were struggling to find jobs that paid well. And for us, the solution seemed to be was to change up our lifestyle, to live ultra frugally, to do as much as we could for ourselves. and that's really what drove us to decide to move out to rural Missouri and start our homestead at that time with what was two very young children.

13:50Homesteading can cover a lot of different things. For us, what that meant was we had a very large garden every year. We raised chickens for eggs. We also raised dairy goats for five years. We had goats and sheep that we raised for meat. Our hope was that eventually we would be able to live off of the homestead as our job. So my husband still commuted back to town for his job in ministry. I still taught music. I eventually had to stop teaching because we had a child while we lived on the farm. We had a child who was born with a lot of medical issues and then she needed a full-time caregiver. So I stopped being able to work because my whole life was going to appointments because out there, there isn't any health care.

14:33So commuting now to a large city, which just takes all day. We made the decision to make a new plan during COVID because at that time, the government was giving child payments. That was a big chunk of change, and we realized that this was the one opportunity we were going to have to be able to send my husband back to school, or one of us. We decided it was my husband. As soon as he graduated and started nursing, he was able to triple his salary. But it was a five-year investment. Took him two years to get through the school and then save enough money because you got to move to the city where the cost of living is a lot higher and housing is very expensive.

15:17We were able to sell our homestead and move this summer. So the summer of 2025. We're in walking distance of multiple parks, walking distance of like little pizza shops and a grocery store. I mean, it's a different existence and I feel so thankful now. I understand now like what my grandmother fought so hard for, for, you know, like the freedom to be able to be like, you know what, today I don't want to cook dinner. I think we're just going to go, you know, get something or I want to go meet a friend for coffee and I have the freedom to go and do that now where before I just, there was just no way.

15:56It was like just the biggest relief to have found a house, to have sold it and to be able to move.

16:06Laura Griggs there, now living with her family in Jefferson City, Missouri. You can tell us about your adventures in housing at marketplace.org.

16:33Coming up. Why do you care so much about monopoly? It seems so silly. It's the board game you either love or love to hate. Me, I'm a fan. But first, let's do the numbers. U.S. markets had shorter trading hours this Black Friday. The Dow Jones Industrial Average gained 289 points, 0.6%, to finish at 47.716. The Nasdaq rose 151 points, 0.7%, to close at 23.365. And the S &P 500 gained 36 points, 0.5%, to wrap the day at 68.49. This was also the last trading day for the month, and November was a shaky one. The Dow and the S &P 500 finished the month in the black, both now on a seven-month winning streak.

17:17The Nasdaq, however, lost its momentum and was down this month for the first time since March. Bonds were almost flat. The 10-year Treasury yield rose very slightly to 4.01%. You're listening to Marketplace. This podcast is supported by Odoo. Some say Odoo business management software is like fertilizer for businesses because the simple, efficient software promotes growth. Others say Odoo is like a magic beanstalk because it scales with you and is magically affordable. And some describe Odoo's programs for manufacturing, accounting, and more as building blocks for creating a custom software suite.

17:54So Odoo is fertilizer, magic beanstalk building blocks for business. Odoo, exactly what businesses need. Sign up at odoo.com. That's O-D-O-O dot com. You've finally broken loose from work. Three friends, one tea time, and then the text. Honey, there's water in the basement. Not exactly how you pictured your Saturday. That's when you call us, Cincinnati Insurance. We always answer the call. Because real protection means showing up. Even when things are in the rough. Cincinnati Insurance. Let us make your bad day better. Find an agent at CINFIN.com. This is the story of The One. As head of maintenance at a concert hall, he knows the show must always go on.

18:40That's why he works behind the scenes, ensuring every light is working, the HVAC is humming, and his facility shines. With Grainger's supplies and solutions for every challenge he faces, plus 24-7 customer support, his venue never misses a beat. Call QuickGrainger.com or just stop by. Grainger, for the ones who get it done. This is Marketplace. I'm Kristen Schwab. Okay, close your eyes and imagine a table of sugary holiday treats. Maybe you see some peppermint bark, a Yule log cake, or crinkle cookies. Well, a common denominator in all those recipes is chocolate. And unfortunately, chocolate is becoming a more precious food.

19:28Extreme rainfall, drought, and heat caused by climate change have pushed cocoa prices to record highs in recent years. And some experts caution that most of the land used for cocoa production won't be farmable in the future. Marketplace's Amy Scott, who hosts our climate show, How We Survive, she brings us this story about new ways tech entrepreneurs are making chocolate so that hopefully we can keep enjoying it for years to come. Here's Amy. I'm in West Sacramento, California, visiting a company called California Cultured, where they make chocolate out of cocoa cells. No plants required. Safety glasses.

20:09We don't need them. Yes, we actually do. Good call. CEO Alan Perlstein is showing me around. We sort of wrangle the cells and make them do what we want in this part of the lab. By wrangle, Perlstein says they're actually sort of tricking the cells to only grow the tissues they want, targeting certain compounds, flavors, and fats. Part of how they do that is by feeding the cells certain mixtures of food, like sugar and plant extracts. Pearlstein opens up a retrofitted pizza fridge with racks for stacking pans of pizza. Only instead of pizza, there are trays of Petri dishes filled with tiny brown blobs.

20:54They look like little boogers, basically. I don't know how else to describe it. It's basically little clumps of brown cells. So that's what they look like when they're growing inside of the cocoa pods. Each little blob, Pearlstein says, contains thousands of cocoa cells. From here, he says, it's a bit like repotting plants. The bigger the cells grow, the bigger the container the cells need to keep growing until they're ready to be harvested. To make chocolate, the cells get fermented, roasted, and ground into a powder or liquid. We do have some chocolates if you guys are interested in tasting them.

21:37Oh, no thanks. I'll pass. All right, well, let's get out of here. Have you not seen my mouth watering over here? Steve Stearns is head of strategy for California Cultured and a former chef. He has three different chocolates laid out on a platter for me to try, all grown in the lab here. The first two chocolates are a bit too sour for my taste. It's not my favorite. I'm going to be honest. Sterns says I'm picking up on the fruity, more acidic notes. But the third one is a nice, toasty, dark chocolate. I think that's my favorite of the three. It's got a little bit more bitterness to it. But it still has those fruity notes.

22:18You and I can't buy California Cultured's chocolate yet. But the plan is to sell the ingredients they make here and also lease the technology to large-scale producers. Next year, they plan to release a product with Meiji, the company that makes those little chocolate pandas. I'm Amy Scott for Marketplace.

22:42That's just one story about the changes coming to your dinner table. Amy has more as a part of a Marketplace special called Feeding the Family, a collection of stories about the economics of food. You can hear the episode in the Marketplace podcast feed.

23:15Holiday gatherings tend to be a time of year when people dust off some classic board games. Monopoly is maybe the most classic of them all. Growing up, Mary Pilon would play it with her family every Christmas Eve. Inside the box was the game's origin story. Monopoly came along during the Great Depression. A man named Charles Darrow is often credited as the inventor. He eventually sold the game to the Parker Brothers. But Mary went on to discover another story about Monopoly. One that led her to write a book called The Monopolists. I came to this story by total accident. In 2009, I was working as a staff reporter at The Wall Street Journal.

23:56As I'm sure as many people remember, there was a lot going on in the world of Wall Street in 2009. And a lot of people were drawing comparisons to the Great Depression. So I thought, oh, I'll just mention in passing, you know, Monopoly came out of the Great Depression. And I was looking everywhere for the true story, and I wasn't finding it. We were doing these really complex stories about securitization and, you know, policy derivatives. And I was like, I can't get the sentence about the board game right. I'm so dumb. And then finally, I reached out to this man, Ralph Anspach. I saw that he had been involved with litigation with Parker Brothers years ago in the 1970s, 80s.

24:33And I said, hey, I know this sounds crazy. I'm just trying to find out what the deal is with Monopoly. And he immediately got back to me and said, oh, I waited 40 years for someone to ask me about this. Like, the story's all wrong. It was actually invented by this woman, Lizzie McGee. She received a patent for her landlord's game in 1904. And she created this game as a teaching tool to teach people about the evils of monopolies. In the late 1800s and the early 1900s, there's this huge boom of wealth. And the term monopolist, you know, is being used in a really different way. because it's not just that people are getting wealthy in a way that we had never seen in the United States.