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story there shall be. We'll do energy as well. And sure, tariffs, why not? From American Public Media, this is Marketplace. In Los Angeles, I'm Kyle Rizdahl. It is Wednesday today, the 20th of May. Good as it always is to have you along, everybody. If you have, like most normal people in this economy, not been paying a whole lot of attention to the bond market, I get it. Totally. But give me a couple of minutes here to bring you up to speed. The yield on the 30-year U.S. Treasury bond yields, of course, the interest the government has to pay, hit almost 5.2 percent this week, as high as the long bond has been since 2007. That is news in and of itself. But if you pull back a little bit, you will see the United States is not alone. Bond yields in Germany, in the U.K. and in Japan are at multi-year highs as the war and the ensuing energy shock and inflation continue to ripple through the global economy. There is a lot going on here. So we've called Nicole Serby. She's an economist at Wells Fargo. Nicole, thanks for coming on. Good to have you back. Thanks for having me. This is not a solely American phenomenon. I talked about the third year up in the introduction, but things are happening globally. And I want to start with what happens when rates go up like this yields

like on the whole planet. Yeah. So if you're an investor looking for yield, that's a great thing. But if you are a government trying to issue debt, not so great of a thing.

Yeah. Say more. I mean, money is more expensive basically, right?

Yes. And so when we were talking about sovereign bond yields, what we're essentially talking about is the cost of borrowing. And so with the cost of borrowing going up across the globe, if you're issuing debt, it's just going to be more and more expensive to do that. And this comes at a time where no matter what advanced economy you're looking at, the fiscal outlook is daunting because of a variety of factors. And if I need to issue more debt, my interest expense is only going to go up exponentially if the cost of that debt is also rising.

I saw a great line in the newsletter, I think, yesterday, and I would credit it if I could remember. But the quote which I wrote down is too much debt, too little fiscal discipline and no appetite for fixing either. What do you think?

I think that's generally right but I also think it depends on the country you're talking about you have some countries across the globe that are let's say more into fiscal austerity and more willing to take on that fight than others for instance even if you look in the eurozone the fiscal outlook for let's say France and Belgium their leverage ratios they're projected to continue to rise but if you look at a pace like Spain or Italy they've actually already gone through some pretty tough corrections in this regard, and they're actually making progress towards lowering their debt burdens. And so it depends on the country that you're looking at.

But in general, I think that is a true statement. Can you help me understand why this seems to be sort of in the last, I don't know, couple of weeks-ish, yields seem to have gotten a whole lot of attention because they've been going up so much. And I guess my question is, you know, The energy shock's been going on for, let's see, February, March, April, May. I mean, it's going on three months now, and the bond markets are paying attention now?

Yeah, so I think some of that has to do with just bond markets were kind of waiting to see the duration of this energy price shock. So initially, you're going to get a shock, and we've seen that already in crude oil and gasoline. But let's say that this conflict magically ended four weeks in, then that shock would have truly been transitory in nature. that's that scary word transitory i was just gonna say gutsy move man gutsy move gutsy move i try not to say it too

often. But what we've seen is this conflict hasn't proven to be transitory, right? It's actually stuck around. And so what that means is that inflation is just going to be all that more persistent. You're going to see higher transportation costs bleed into other areas of your economy, like food, like other goods, retail, things like that. And so now you're seeing that the bond market is reacting to that. We're not just going to get a blip in inflation. It looks like the overall path of inflation is going to be a little bit higher.

There is a growth risk here, too, yes?

Yes, particularly for economies that are really reliant on imported oil. I would say the United States in particular is not in that situation, but many economies across the globe are.

All right, bring it home for me. There is a mythical person in Ottumwa, Iowa, who I always have in mind when I ask this question, and you're the lucky winner today on this question. If I am going about my daily life in Otomo, Iowa, why does this matter for me?

Yeah, this matters for you. I think in particular, going back to what we're talking about, just not even the inflation, so your prices are going to be rising, but the fiscal situation of the U.S. government. If you think about, again, rising interest costs, that's just going to make our interest expenses rise even more. And if you look at the share, the composition of the federal budget right now, we're actually spending more on just interest expenses, financing costs, than we are on national defense. And so the more that we have this growth in interest expenses, the less the U.S. government can afford to spend on particularly discretionary categories. So think about education, other infrastructure, things like that. And so that is how you bring it home here, is you want to have your fiscal situation under control so that you can continue, the government can continue to support those critical areas of the economy.

Nicole Servi, she's at Wells Fargo. Nicole, thanks a lot. I appreciate your time.

Thanks for having me.

I said yesterday the average rate on a 30-year fixed mortgage is up at 6.75%. Well, now you know why. On Wall Street today, bond traders are one thing. Stock traders are a whole different animal. Never met a, yes, we're really close to a peace deal rumor that they didn't like. We will have the details when we do the numbers. one of the reasons one of the many reasons to be clear as nicole was just saying that bond yields are up is that prices are up and consumer inflation expectations are up and that is thanks to President Trump's preferred trade tool. Tariffs, in case that somehow wasn't clear. As you know, the Supreme Court ruled this past February that the president's tariff palooza of April last was illegal. The White House has indeed started paying out some of the $166 billion it owes American consumers and businesses. And actually, as Marketplace's Kristen Schwab reports, those deposits are showing up earlier than businesses had been expecting.

Sarah Wells checked her company bank account last week and got a welcomed surprise.

About half of what I claimed for refund was in my bank account. Like the cash was actually already not even pending. It was already deposited back into my bank account.

There it was, $10,000 in tariff refunds. Half of what the government owes her company, Sarah Wells Bags, which makes products for new moms.

I was really hesitant to believe it would be real until the check was in the bank, so to speak. and it was exciting to see it.

She already has plans for the refund. She's earmarked the money to pay for other tariffs still in place.

But she's not letting herself get too excited. I think it's okay to do both celebration on these refunds, but also be mindful that we're still in a state of real upheaval.

Many of the business owners I've talked to about these tariff refunds are, like Wells, still in disbelief that they're actually happening, even after seeing the cash in their accounts. And even though the process for many businesses has been drama-free, Brian Burke is chief commercial officer at the customs brokerage, Seco Logistics.

The refund process that we've seen is actually going very smoothly.

As of about a week ago, U.S. Customs and Border Protection says it's approved more than $35 billion of the $166 billion that's owed to businesses. And Burke says though there's still some tariff uncertainty, businesses are feeling confident enough to order goods regularly again.

There's more of a smoothing out of the import volumes. And with certainty, I think companies can also price better as they sell and manufacture in the United States.

One company I talked to even lowered its prices last week after getting a $20,000 refund. Glory International Trade is a...

distributor that imports small appliances like blenders and fans from China and Vietnam. Vice President of Operations Zhang Luhe hopes to get another $40,000.

I am a little bit skeptical about the remaining amount just because I'm not sure if there will be any money left over for refunds.

Getting any money back is good, but it's almost as if tariffs have taken a backseat. There are other things to worry about now, like the economy. Luhay says not long after the war started, trucking companies started increasing prices.

They started charging fuel surcharges. So I think that's like an extra $200 for every shipment.

Luhay is nervous. He's worried about his personal budget, and he's cutting back on spending.

Less family vacations or trips, if any at all. Less going out to eat.

He figures if he's spending less, the people who might buy his appliances are spending less too. I'm Kristen Schwab for Marketplace.

Here's one of those what you think a story is going to say is not what the story actually turns out to say stories. The great state of Oklahoma is among the top producers of oil and natural gas in this economy. So one might well imagine with crude oil prices around $100 a barrel and President Trump's war in the Middle East dragging on, Oklahoma and the region would be in line for an economic boost, says the Federal Reserve Bank of Kansas City. Not necessarily. Marketplace's Elizabeth Troval has the details.

There are a few reasons Oklahoma is simply not seeing a flurry of additional drilling or oil and gas production right now.

These prices have got to be sustainable for a very long period of time.

That's Tom Tsang with Texas Christian University, who worked in Oklahoma's energy sector for years.

You'd have to see $70 a barrel going out for several years to be able to say, hey, when we drill this well, which we expect to produce for 20 years, We have to get a return on it that our shareholders are going to be happy with.

There's also a geological reason Oklahoma isn't seeing a big boost from the energy supply crunch, says Courtney Cowley, who is based in Oklahoma with the Kansas City Fed.

In Oklahoma, we tend to have basins and plays that are much higher in gas content.

And regional natural gas prices have been tamped down. Travis Roach with the University of Central Oklahoma says that's partially because of how natural gas is taken out of the ground not too far away in the Permian Basin.

Places in Texas, New Mexico, while they're producing oil, they produce natural gas as a byproduct. And so you have this excess of natural gas just because there's a lot of production happening there. And so that keeps prices slightly lower in general here.

All of this means that Oklahoma isn't seeing an oil and gas boom. That limits the uptick in tax revenue that comes from higher prices. Employment is also unlikely to see a big boost. Courtney Cowley again.

We've really seen gains in productivity in oil and gas production.

So even if they were to produce more.

They don't need as many people in order to be able to do that. So even though we've seen revenues increase in oil and gas in Oklahoma, we've seen mining employment overall actually decline.

Meanwhile, the state's other important sectors, like agriculture, are feeling the strain of higher diesel prices and other energy-related costs. I'm Elizabeth Troval for Marketplace.

More news from the energy sector now. Utility bills, to be precise. It has been a rough couple of years for ratepayers, as most no doubt know firsthand. And it is not about to get better. New data from the energy nonprofit Power Lines and Ipsos says nationwide utilities requested almost nine and a half billion dollars in rate increases in the first quarter of this year. That's after they asked for 31 billion dollars in rate hikes in all of 2025, which was more than double of the year before that. Now, yes, data centers are part of that, but they are not all of that. Marketplace's Kaylee Wells breaks it down.

The price hikes have been huge because basically a bunch of different problems are converging at once. Tom Bullock leads the Citizens Utility Board in Ohio, one of the states with the steepest increases.

Data centers are kind of the first boulder rolling down the hill triggering a broader rock slide.

Bullock also blamed delays for permits and equipment, skilled labor shortages, and policies that favor old.

coal-burning facilities. There are White House orders forcing aging power plants held together by duct tape to remain open, even when their own owners want to close them to stop losing money.

Then there's the list of unavoidable costs. That one comes courtesy of Michael Levy with

Beringa Management Consulting. The grid was largely built in the 60s and the 70s, and these assets are just coming towards the end of their useful life.

The hikes cover fixing and upgrading aging equipment and broken equipment, which Levy says is a more common problem now thanks to climate change.

Hurricanes, wildfires, storms. And if you think about, like, the frequency and severity of those getting worse over time, then that obviously drives the need for investment to be even greater.

You've also got geopolitical pressures, too. Prices went up after the war in Ukraine disrupted the global fuel supply, says Charles Hua, who leads Powerlines, which put together the report. Same problem happening now with the war in Iran.

And that could continue to put upward pressure on people's utility bills going forward.

Hua says all the metrics that Powerlines measures say the utility bills are going to keep going up, at least for now. I'm Kaylee Wells for Marketplace.

coming up a lot of screenwriters are really suffering right now ai as a side hustle but first let's do the numbers now industrials up 645 points today one and three tenths percent, 50,009. The Nasdaq climbed 399 points, about one and a half percent, 26,270. The S&P 500 added 79 points, one and a tenth percent, 7,432. There. Kelly Wells was talking about utilities. Well, here you go. First Energy operates across several Mid-Atlantic and Midwestern states, up eight tenths percent. Portland General Electric, that's Oregon, not Maine, up nine-tenths percent. American electric power with customers in 11 states was essentially flat. Bond prices? Well, thanks for asking. Babe Rose, yield on the 10-year T-Note down 4.57 percent. You're listening to Marketplace.

This Marketplace podcast is supported by Viking, committed to exploring the world in comfort. Journey through the heart of Europe on an elegant Viking longship with thoughtful service destination-focused dining and cultural enrichment on board and on shore. And every Viking voyage is all-inclusive with no children and no casinos. Discover more at viking.com.

This episode is sponsored by Morgan Stanley's Thoughts on the Market. It can be difficult to stay up-to-date on the financial market in today's ever-changing environment. With so much commentary at any given moment, it's hard to cut through the noise to gain quality, actionable insights. Morgan Stanley is here to help with their podcast, Thoughts on the Market. Thoughts on the Market is your daily market snapshot, covering trends across the global investment landscape and offering perspectives from Morgan Stanley's leading economists and strategists. It's one of the only daily podcasts providing real-time commentary from a financial institution on the day's biggest questions and topics. And with most episodes under five minutes long, market clarity can fit seamlessly into your daily routine. Staying informed has never been easier. Listen and subscribe to Thoughts on the Market on Spotify, Apple Podcasts, YouTube, or wherever you get your podcasts.

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This is Marketplace. I'm Kai Rizdahl. This next item comes with the perhaps helpful reminder.

that health care accounts for just shy of 20 percent of this entire economy. Told you that so I could tell you this. There is some new analysis out from the health policy nonprofit KFF that says by the end of this year, more than five million people could wind up dropping their coverage under the Affordable Care Act. That's more than 20 percent of total enrollees. Marketplace's Samantha Fields explains why and what it might mean for premiums and overall health care costs.

Going into this year, insurance companies knew a lot of people were likely to drop ACA coverage because it was clear that Congress was not going to extend the extra financial support many people had been getting to buy insurance on the marketplace. Matthew Fiedler at the Brookings Institution says they also had a good idea of who was likely to go without insurance.

Past experience shows that when premiums rise, healthier people tend to be the first to drop coverage.

And when lots of people, especially healthy people, do drop coverage, Jennifer Sullivan at the Center on Budget and Policy Priorities says what happens next is simple

economics. If there are fewer people in the marketplace to spread risk across, then insurers have to charge those smaller number of people more in order to provide the services that they're

providing. They already are. ACA premiums are nearly 60 percent more expensive this year than they were last year on average. And with people continuing to drop out of the marketplace, Sullivan says they're likely to go up again. So people are squeezed right now and could be squeezed even more next year. People who get health insurance through an employer are less likely to see their premiums go up significantly next year. But Sabrina Corlett at Georgetown's Center on Health Insurance Reform says hospitals and providers will likely see costs go up.

As more people become uninsured, they will forego necessary care, they'll skip prescriptions, and they'll get sicker and they'll end up in the emergency room. And hospitals will treat them and in many cases will end up putting the bill for those who can't afford to pay. And as those costs go up for hospitals, these uncompensated care costs, they have to be passed on.

And in many cases, she says, they will eventually be passed on to you and me. I'm Samantha Fields for Marketplace.

making it in hollywood is even harder than it used to be from its most recent peak that was 2022 there has been a 30 drop in employment for actors yes but also for carpenters and designers and the many, many professionals who work behind the scenes to put a production together. That is data, by the way, from the Labor Department put together by The Wall Street Journal. And since those jobs have been drying up, a lot of people in the industry have been working in a new kind of gig economy. Ruth Fowler is a screenwriter. She wrote in Wired the other day about her side hustle as an AI trainer. Ruth, thanks for coming on.

Thank you. I'm so happy to be here.

So as I said in the introduction a second ago, you are a screenwriter. How did it come to pass that you found yourself working as this thing that's called an AI trainer?

Well, the industry, as everybody knows, is really not going through a great time right now. It's really in flux. A lot of screenwriters are really suffering right now. And we're all trying to find different jobs, different ways to survive. So I was on a Facebook group with a bunch of WGA moms, actually, and somebody mentioned that they were working for a company called Mercur for $150 an hour as a writer. And I was like, hmm, OK, I'm going to look into that. That sounds kind of interesting.

Yeah. WGA, Writers Guild of America, of course. $150 an hour. Not bad. But here's the question. What does it mean to be an AI trainer? What is that job?

it is probably one of the worst jobs i've ever had basically they kind of advertise it as you can do this wherever you want you can do it on your own time but that means that you have to be chained to the laptop because what actually happens is they release what's known as tasks um at any time of the day or night and often they kind of um they hire way too many people so people are just kind of scrabbling around like it's a french revolution like trying to get these tasks and waiting for hours. So what I found is I actually didn't have any life while I was

doing it. What kinds of tasks, what were you actually doing as you were chained to your laptop?

They were incredibly boring. Some of the tasks were kind of watching like a video, which was taken from Instagram and transcribing every tiny little second of it. So the moment a dog barks a moment balloon pops other tasks like I did a little bit of red teaming which is where we're kind of trying

to break the ai system and that's like it's ostensibly meant to be kind of a safety thing um but it kind of begs the question like why are we doing this now surely this kind of safety team issue should have been done before they released it to the public you know yeah you um you spend a

good amount of time in this piece talking about the other people um who had wound up doing this kind of of gig work ai trainer some of them you know hollywood screenwriters looking for side households and others just needing the money, I suppose, right? Who else is doing this?

It's such a mix of people doing this kind of work. There's so, I mean, I met a Harvard-educated doctor. I met a plastic surgeon from the UK who was in between jobs, a scientist, a librarian. There's a huge amount of people. I think the economy is not in a good place for anybody, And everybody is trying to pick up extra work.

You speaking of extra work, you you analogize this work to, you know, sort of the next generation of waiting tables, basically, for would be, you know, Hollywood screenwriters, actors, take your pick. Are you still doing it? Are you still having to do this kind of work?

I am still doing it. At the moment, I am training as an EMT because my family is medical. I wanted to do something, which was kind of giving back. And I kind of had this guilt around the fact that I was working for this system, which so many people hate, so many people are really upset by, and it's taking so many jobs. So I used the money, and I retrained as an EMT. And I'm still a writer. I'm always going to be a writer. But the plain truth is that while the economy is so bad, I need something else. So I decided to do something which is actually going to do some good for people.

Ruth Fowler, screenwriter, also sometimes AI trainer. on the side. Ruth, thanks very much for your time. I appreciate it.

Thank you for inviting me on the show.

this final note on the way out today back up to the top we go one last observation from

Nicole Servi at Wells Fargo. A lot of central banks care about inflation, and so that means that they're going to be more hawkish in their interest rate setting. Speaking of which, the

minutes of the most recent meeting of the Federal Reserve came out today here with the money, quote, a majority of participants highlighted that some policy firming would likely become appropriate if inflation were to continue to run persistently above two percent, end of quote. Policy firming, of course, means raising interest rates. The most recent headline reading we had on PCE, three and a half percent, 3.5 percent. Also, and not for nothing, Kevin Warsh takes over on Friday. Our media production team includes Brian Allison, John Focke, Montana Johnson, Drew Jostan, Gary O'Keefe, and Charlton Thorpe. Alex Simpson is the manager of media production, and I'm Kai Rizdal. We will see you tomorrow, everybody. This is 8 p.m.

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