OpenAI's waiting game, gas pump pain, and severe sulfur strain!

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0:06This is the Indicator from Planet Money. I'm Waylon Wong. I'm Cooper Katz McKim. And I'm Ricky Mulvey. You guys, it's already been a roller coaster of a week. The Fed hiked interest rates by 25 basis points on Wednesday. And if that's how Hump Day was handled, one can only assume that this will be quite an eventful... It's indicators of the week. That's right. On today's show, we have a real-time tracker for gas costs that might make you cry. OpenAI doesn't want to go public for safety, allegedly. And fertilizer has a sulfur problem. It's getting a little pricey. That's all after the break. This message comes from Capella University.

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1:55This is Indicators of the Week. Weyland Wong, you are up first. All right. My indicator is$108 billion. That is how much American consumers have paid in additional fuel costs since the Iran war started in late February. This number covers both gas and diesel, and it works out to around$820 per U.S. household. These figures come from the Climate Solutions Lab at Brown University. It's tracking these numbers live. So if you want to feel anxious, you can go to the website and watch these big red numbers tick up in real time. Ooh, that sounds stressful. That's perfect. You said additional fuel costs.

2:33So what does that mean? Right. So the number crunchers at Brown are comparing current fuel costs to a counterfactual, basically an alternate reality where the Iran war never happened. Of course, there's no way to know exactly what gas prices would be doing in this other timeline. Unless, obviously, if you're a time traveler. Obviously, if you're Marty McFly from Back to the Future, you've got the sports almanac, you know where gas prices are, but not in this case. OK, so how did they come up with these numbers? The brown data uses a 30-day average price from before the war and then adjusts it for seasonal factors.

3:07You know, these are variations in how much gas people use depending on the time of year. People going on road trips in the summer, for example, leads to higher demand in warmer months. Yeah, but not necessarily fighting a war or, excuse me, a military conflict. That is another thing that can happen in warmer months, I guess. Either way, that's their best calculation of where gas and diesel prices would be if there were no war with Iran. And you might have seen in the news this week that diesel prices are now at a record level. They're over$6 a gallon. And diesel factors into the costs for consumers, even though most of us aren't filling up our tanks with it.

3:44Yeah, that's exactly what the tracker said. It said higher diesel costs means higher prices for consumers, whether or not they pay it directly at the pump. That's because trucks and trains and factories and farmers use diesel. And when they pay more, those increased costs can flow through to what we pay for groceries or Amazon purchases or what have you. All right, Waylon. Thank you. Ricky, what do you got for us? OK, my indicator is one point two trillion dollars. This is the latest funding round that OpenAI is considering with private investors. It's according to the Financial Times. And this comes at a time when OpenAI CEO Sam Altman told Fortune he's not ready to take the company public.

4:25I actually think that given everything happening with safety, this would be right now would be an ill-advised moment to go public. It's safety. That's why we can't take our company public. It's safety, but then like why are they still building their product if it's so unsafe? Yeah, there's a lot of weirdness here. Like earlier this year, the tech media outlet The Information reported that Altman and the company's chief financial officer, Sarah Fryer, they were at odds about when to take the company public. Altman wanted to go public faster. Fryer was reportedly concerned about the company's spending.

4:58There's a lot of drama here. Maybe they should go talk to their chatbot therapist about it. Yeah, and they have some relationship problems like Fryer doesn't report to Altman, which is an unusual relationship between a chief executive officer and a chief financial officer. Altman has also allegedly left Fryer out of some meetings with like big money investors, which is also unusual. Did OpenAI not already file to go public? Yeah, in June, the company filed something called a confidential S1. Basically means they told regulators about their finances, but not the broader public. Oh, that's juicy.

5:33Okay, so what does this mean for the stock market or regular, degular people who are not private investors in open AI? Yeah, the stock market and the bond market, which you just covered earlier this week, it's carried by the AI growth story. If an open AI initial public offering landed with a thud, that could be bad news for the rest of the market. Okay, and the safety concerns? Oh yeah, the safety concerns! If it's a public company, it would need to be more transparent, at least about its financial health, like safety record, maybe. Hence the concern about safety right now. I mean, if artificial intelligence gets to a level where it is threatening the very existence of humanity, I'm not going to care if open AI is public or private.

6:18I'm not going to have time to be reading the regulatory filings. I'm going to be fighting for my life. You know, fighting robots, caring about corporate structure, both are priorities. And right now, OpenAI, it's a little bit like a couple that's been together for a decade and still pondering if now is the right time to get married. Like, come on, you're worth a trillion dollars. You should be mature by now. And by the way, it's rival Anthropic. It is still marching ahead with its own IPO. Are you saying they're like the Goldie Hawn and Kurt Russell of tech IPOs? I don't get this one. Goldie Hawn and Kurt Russell have been together for like forever, but they've never gotten married.

6:58but they've been a couple and raised children together. They're so cute. As long as they're happy. Yeah, they are happy. There's a lesson here for us all. As long as OpenAI and Anthropic are happy, they don't need to go public. They can go public whenever they want. Okay, Cooper, round us out here. All right, my indicator is$1 ,100. That is around what it costs to purchase a metric ton of sulfur if you didn't already know that. Like from my haunted house? Right. I don't know how much you were buying previously. The previous 10-year average was around$170. That is an enormous amount more. It's like a 500 % increase.

7:39There's a whole extra zero on the number. It's a lot more. And this matters because sulfur is a key ingredient for fertilizer, which is obviously needed to grow food. Oh my gosh. So what happened to all the sulfur? It vanished from the earth? So what's weird is that the U.S. does produce most of its own sulfur and production is fine here. But the other main hubs for it are in the Middle East, in China and Russia, where we have some notable tensions. Oh, my goodness. We just talked about it on the show yesterday, how sulfur also moves through major commercial waterways in the Middle East. Shout out to the Red Sea.

8:16Yeah. Within the two straits whose names we now know, my heart, because they're getting clogged up, the straits of Hormuz and Bab-El-Mondub. Okay, so supplies dropping, and then the price gets pushed up for everyone, even here in the U.S., where we have a lot of our own sulfur. So it's the same kind of thing happening to a barrel of oil. Even though the U.S. is a major producer, we're just not immune from global price increases. And that price increase is so major that it's changing the economics for fertilizer producers. There's one called Mosaic who told us they've had to idle two plants in Louisiana already because of low sulfur supplies.

8:50OK, so this is already having real impacts. And I imagine this is not going to bode well for food prices because we already talked about how diesel is at a record high. Now you have high diesel prices, plus you have a lack of fertilizer. I mean, the agriculture industry is like really in trouble. Yeah, diesel plus fertilizer. It's projected to keep food prices rising, it's safe to say. Rabobank is a bank focused on agriculture. They foresee food inflation in the States to rise another 3 to 5 percent in the next year after already rising 4 to 6 percent this year.

9:26Cool story, Cooper. Where can I hear more? Read more. I don't like listening anymore. I just want to read. Yeah, if you hate listening, we have a solution. I wrote about it in this week's Indicator newsletter, which is our weekly quick hit of economic news that we talk about behind the scenes. It came out this morning, actually. You can find it in the show notes. You can also sign up at npr.org slash Indicator Newsletter. This episode was produced by Angel Carreras and engineered by Robert Rodriguez. It was fact-checked by Skylar Swenson. Kicking Cannon is our show's editor, and The Indicator is a production of NPR.

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