Marketplace - American Public Media
Update: Misty Copeland was promoted Tuesday, June 30 to principal dancer for the American Ballet Theater. She's the first-ever African-American woman to hold that title.
Age starting dance: 13
Height: 5 feet 2 inches
Bust: "Bigger than most"
At least, that's how ballerina Misty Copeland describes her numbers-defying career in dance. A soloist with the American Ballet Theater in New York, Copeland recently explained how she doesn't really fit into the traditional model for ballet, but still made it work.
“All of those numbers, they just don’t add up to create a classical dancer,” she says. "No matter what, I'm going to be who I am."
Listen to the full conversation from our live show in New York City in the audio player above.
Tesla Motors is building the world's biggest battery factory just outside of Reno, Nevada. The company is calling it the “gigafactory,” and when it’s up and running in 2016 it’s expected to make Tesla’s electric cars much more affordable.
“In a single factory we're doubling the worldwide capacity to manufacture lithium-ion batteries,” says J.B. Straubel, Tesla's chief technology officer.
That's significant enough. But the company also plans to develop batteries for use with solar-power generation – giving Tesla a shot at challenging public utilities as an energy source, Straubel says.
“At the price points that we're expecting to achieve with the gigafactory ... we see a market that is well in excess of the production capability of the factory,” says Straubel.
The market for batteries is an offshoot of the booming business for solar panels, particularly in states such as California, where solar is becoming commonplace.
“We sign up approximately one new customer every minute of the workday," says Will Craven, director of public affairs at California-based SolarCity.
Much of the excess energy harnessed by solar panels is returned to the power grid, Cravens says. This means homeowners and businesses may earn a credit from their power companies, but have no say over when and how that energy is used.
The partnership with SolarCity will use rooftop solar panels fitted with Tesla’s battery packs to allow customers to keep that energy in-house. That means they can use it however, and whenever, they want. The concept puts Tesla in direct competition with utility companies.
“Stationary storage, or backup storage, is really being considered the ‘Holy Grail’ of renewable electricity generation,” says Ben Kallo, an analyst with the Robert W. Baird financial services firm.
Kallo points out that the intermittent nature of renewable energy sources makes them less reliable because the wind doesn’t always blow and the sun doesn’t always shine. But with the ability to store that energy, renewable energy sources can compete head-to-head with utility companies for customers.
“There are still many utilities out there who kind of have their head stuck in the sand and just hope that this goes away. What we're seeing is really building momentum,” Kallo says.
Forward-minded utilities might look at Tesla’s business model as an opportunity, he says. Energy-storage technology could be used to build capacity in their existing grids, and also build new infrastructure for battery-powered cars and homes.
In Maui, Hawaii, negotiators from 12 Pacific Rim countries are in the last stages of negotiations for the Trans-Pacific Partnership.
The White House has been working on the deal for years, and with Congress' passage of a fast track bill, negotiations are reaching an end — the deadline is Friday. In Maui, trade negotiations are going on in hotel conferences rooms. Lobbyists, media and advisers are taking over the usually tourist-filled area to work out the kinks: Canadian milk trade, drug patents and labor law are among the last sticking points.
There's huge pressure to wrap up negotiations this week; the longer they last, the more likely they are to impact the upcoming election cycle and fall apart.
Tracey Samuelson reports from Maui on how the trade negotiations are progressing and what's left to work out.
Click on the media player above to hear more.
A man died in the French port of Calais as hundreds of migrants tried to enter the Chanel Tunnel to cross illegally into the United Kingdom. The 20-year-old from Sudan was thought to have been crushed by a truck. He’s the ninth person to die attempting the crossing this summer. Several thousand migrants are camped out in Calais, and every night some of them try to jump on a truck or train and smuggle themselves through the tunnel into Britain.
This so-called “migrant activity" has caused massive disruption in trade and traffic between Britain and Europe, and it’s raised big questions about migration and asylum.
Why are so many migrants desperate to settle in Britain? Why – if they are genuine refugees – do they not claim asylum in the first safe country they reach, like Germany or France? And why have the French not done more to contain the crisis in Calais?
Click on the media player above to hear more.
What will Amazon’s drone highway in the sky look like?
Probably not a drone highway. Amazon unveiled a proposal where low-level air space would be carved out for drones: 200 to 400 feet would be reserved for high-speed transit drones. Below, there would be space for low -speed local drone traffic, and above would be a no-fly buffer zone to keep drones out of manned-vehicle air space, aka flight paths.
“It’ll be far enough above that you won't have a constant stream of noise or a visual blight, but low enough that it would not worry pilots,” says Ryan Calo, professor of law at the University of Washington.
Amazon shipping drones would share the space with drones doing other tasks like taking air samples, scanning railroad tracks and taking aerial video of a birthday party.
Calo says we'll still be able to see the sky. "I think it’s going to be sporadic. I don’t think drones are suddenly going to darken the skies,” he says.
NASA’s Safe Autonomous System Operations Project has been working with businesses like Amazon to lay the groundwork for unmanned drones to navigate the skies safely. Parimal Kopardekar manages SASOP and describes how drones would collectively consult with a cloud-based source of flight rules.
“You connect into our system and see all the constraints on flight: geo-fencing, airports, wildfires, temporary flight restrictions," he says. "We show all the weather-related things or community-related concerns like noise.” NASA's system would also let users create their own trajectories.
Kopardekar says you won’t necessarily see structured lanes or corridors in the sky unless demand becomes so dense there is no other way to manage.
“It’s not a fixed structure,” he says. “You may see a vehicle that may go over some parts of air space one day, a different airspace the next day, depending on application and demand.”
Drones will need to clear some technological hurdles before such a system can become operational. They'll need to be able to sense and avoid one another, buildings and things being thrown or shot at them. They will need to cope with weather or unexpected changes in airspace rules.
“That technology is underway,” says Brendan Schulman, vice president of policy and legal affairs for drone maker DJI. “But all those more sophisticated technologies are something the [Federal Aviation administration] has put off for now because they don’t quite know how to regulate that.”
In fact, the FAA’s preliminary rules on drones don’t allow for unmanned drones at all, let alone an unmanned system to manage them.
“It would be a shame if we had to wait another 10 years” after all the technology and capacity is in place because the FAA hadn’t kept up, Schulman says.
Shareholders of the consumer review site Yelp are none too happy with the company's performance in the second quarter of 2015. Yelp announced today it lost $1.3 million. That follows equally disappointing losses the quarter before that. Truth is, there are now plenty more places people can go to find the best cheesesteak in Philadelphia or the hottest tapas place in San Francisco. And the competition for Yelp is only getting stiffer.
Neeru Paharia, who teaches marketing at Georgetown University, opens the Yelp app on her mobile phone. Her query? Simple enough: restaurants in Washington, D.C.
"It's sorted by best match, which, you know is ... like, what does that even mean?" she says.
What does that even mean? Critics of the site claim that Yelp filters search results based on its advertisers. The restaurants and businesses that buy ads get reviews closer to the top, they say. In reality, Yelp bases its results on what it knows about you, says John Byers, a computer science professor at Boston University.
"So are you a four-star diner?" he asks. "Are you somebody who wants to do something more casual?"
Yelp's algorithms do suppress a significant number of reviews, Byers says — the ones that it thinks are fake.
"Those algorithms are imperfect, so they do make mistakes," he says.
Another company that loves algorithms? Google. Which brings us to Yelp's other problem, according to Ben Edelman, who teaches tech strategy at the Harvard Business School.
"When you type in the name of a restaurant, it's by no means guaranteed that Google will send you to the Yelp page about that restaurant, nor for any other local business," he says. "Indeed, these days Google likes to send you to its own page."
Yelp has the traffic. Every month about 83 million users visit Yelp from their mobile devices.
"But how does that translate into actually making money, into selling ads, into convincing advertisers to pay or into something else?" Edelman asks.
He said those are details Yelp has yet to figure out, along with almost every other social media startup.
Thousands of workers moved to rural North Dakota to take jobs in the Bakken oil field. Now, with global oil prices half what they were a year ago, there are fewer rigs, fewer trucks on the country roads and fewer jobs. Don Williams, who lives and works in Ross, says the bust could have at least one positive aspect.
Click the media player above to hear the interview with Don Williams.
Todd's series, "Black Gold Boom," is an initiative of Prairie Public and the Association for Independents in Radio.
California's high-speed rail project will pump billions of dollars into the state. While cities like Palmdale welcome the bullet train and its economic benefits, some neighboring towns hate the planned rail project. Consider the small town of Acton.
Within Los Angeles County, you can't get closer to cowboy country than Acton. It's up in the foothills. A town of 10,000, Acton has two groceries and an equal number of stores that sell feed for horses.
"If they're coming to Acton, they're willing to forgo a Wal-Mart and a shopping mall," said Pam Wolter, who has been a real estate agent here for 25 years. "They're coming here for the peace and quiet and for the rural lifestyle."
All the homes in Acton have big lots — at least one acre. Wolter says the average price for a three-bedroom, two-bath house is about $500,000.
She says the proposed routes for the high-speed train scare away prospective buyers and make current residents think about selling.
"There [are] a lot of changes that are going to happen to Acton," she says. "And people are already getting concerned. If they're close to retirement age, and thinking they should move on now, while they can. So we see, as the real estate industry, a serious decline in property value."
Wolter drives me out to visit the actress Tippi Hedren. She's most famous for starring in Alfred Hitchcock's "The Birds." Now she runs the Shambala Preserve — a sanctuary for rescued big cats, like Zeus, the 500-pound lion.
"Zeus was living in Texas," Hedren says. "The son was graduating. And the parents said, 'We'll either get you a Lexus or a lion. One of the two.' And he said, 'I'll take the lion.'"
When Zeus grew too big for the Texas family, he moved here.
Hedren says one of the proposed routes for the high-speed rail would cross her property. "If it came through here, we couldn't be here because of the noise level," she says. "The Shambala preserve would not be able to exist here."
I asked if it wasn't fair to ask people along the planned train route to make a sacrifice for the sake of the environment, since the project would likely reduce the number of people driving in cars. But Hedren doesn't think consumers will really switch.
"Californians are not train riders," she says. "We're really not. When we go to San Francisco, we fly."
Hedren thinks the bullet train is obsolete before it's even been built.
Down the road, Ray and Elizabeth Billet grow peaches and pears. Her grandfather homesteaded here back in 1891. Sometimes they rent the property to movie producers.
"I had another one yesterday who wanted to film in August, and I says, 'Nothin' doin'," Elizabeth says. "Because we'll be picking peaches."
One of the proposed routes for the high-speed rail would cut across the Billets' property. Ray says they had planned to develop some of their land, which is zoned for small houses on 5-acre lots.
"That's gone," he says. "Nobody's going to want to live next to a damn railroad that's going 220 miles an hour."
And because almost everyone relies on wells, Ray says construction of the high-speed rail will ruin the town's drinking water.
Elizabeth says the project doesn't make economic sense for the state. "They don't have the funding for it."
After hearing so many complaints about the cost of the project, I turned to Jeff Morales, CEO of the California High-Speed Rail Authority. He expects the final funding will come from the private sector through a partnership with the state, and that the price tag could be less than the projected $68 billion.
"The bid prices are coming in considerably below our estimates," he says. "I'm confident that we're actually going to be able to drive down the cost of delivering this program."
Morales said the state's population is growing, and it needs more infrastructure.
"When you do a comparison, the cost of building more roads and more airports is about two to three times what the cost of high-speed rail will be," he says.
That argument doesn't carry a lot of weight around Acton.
The state won't make a final decision about the route for high-speed rail for at least a year. So, residents still have time to persuade officials to move the train's tracks somewhere else.
I'm at the same time appalled and embarrassed.
You know how users can rate drivers? They rate you, too.
Which gets me to the appalling and embarrassing part.
Turns out I clock in as an Uber rider at a mere three and a half stars out of five.
I'm at the same time appalled and embarrassed.
You know how users can rate drivers? They rate you, too.
Which gets me to the appalling and embarrassing part.
Turns out I clock in as an Uber rider at a mere three and a half stars out of five.
When it comes to healthcare, it’s generally understood we have a spending problem. Namely, we spend too much.
A new report from the Centers for Medicare and Medicaid Services suggests expenditures are picking back up after a recent historic slowdown.
But even with the uptick, these numbers suggest the nation is making progress.
Cornell economist Sean Nicholson says he can see some good news tucked into this economic forecast.
“We should take some solace that we are seeing 5 percent projected increases,” he says.
In the 30 years running up to the Recession, the nation saw a 9 percent annual increase on average. According to this new report, over the next decade, we’re talking a 5.8 percent average.
So what’s changed?
Vanderbilt health economist Melinda Buntin says slow economic growth, higher insurance deductibles and new incentives that pay doctors and hospitals for valuable care rather than volume all are at play.
“What’s going on is that all of these things together are combing to create a climate in which different types of decisions are being made by thousands of decision-makers in the healthcare system,” she says.
This slowdown has gone on long enough that “I think we are seeing a new normal in healthcare,” says Buntin. “We can see it as evidence of a fundamental shift in the healthcare system.”
That said, the report points out prescription drug spending projections have risen sharply at more than 12 percent, the highest jump since 2002.
Evidence to Buntin that this shift will only last as long as the country keeps trying to control spending.
Law school doesn't look like a great deal for many students. Tuition keeps going up, which means bigger loans to pay off.
But the job market for lawyers remains weak. At lower-tier schools, less than half of students end up with jobs as attorneys, according to a recent report from an American Bar Association Task Force.
Steven Harper, author of "The Lawyer Bubble," argues that those schools should be held accountable. The ABA task force proposes less-dramatic measures, like giving students more information about their prospective debt load.
Click the media player above to hear more.
Poultry industry groups and government officials continue a two-day convocation on bird flu in Iowa on Wednesday, trying to understand caused an outbreak this spring to reach such a dramatic scale that it cost Midwestern poultry farmers 48 million birds. They’re also evaluating how to mitigate a potential outbreak this fall when migratory birds, the virus carriers, take wing.
One of the tools poultry producers may consider is a vaccine. “We have a seed strain that appears to be fairly successful with reference to chickens," U.S. Agriculture Secretary Tom Vilsack said in a Congressional hearing last week. "It's now in the process of being tested for turkey.”
Another focus is biosecurity on farms. That might mean disinfecting delivery trucks that service multiple facilities, or keeping wild birds out of barns.
“These were all things that were done on paper, and whether or not they were done in practice is debatable,” says ag consultant Tom Elam of FarmEcon LLC.
Elan said producers may have gotten sloppy about biosecurity measures because they had gone so long without problems.
Elam doubts an outbreak in the fall would be as extensive as the spring outbreak. But he’s nevertheless glad the USDA is planning for a “worst case scenario” of managing 500 bird flu detections simultaneously — double the amount in the spring. The agency is adding 450 temporary workers in case of a large-scale fall outbreak.
Elam says the agency was too slow this spring to euthanize birds and to clean up infected facilities.
“Perhaps we saw those houses that weren't cleaned up properly responsible for spreading the infection to nearby farms,” he says.
The government response to bird flu is the subject of a Congressional agriculture committee hearing Thursday.
Clothes dryers in the United States use about as much energy each year as the entire state of Massachusetts, according to an estimate from EnergyStar — which is part of the reason the Department of Energy is trying to develop more efficient home appliances.
Among those making significant progress is Ayyoub Momen, a staff scientist at Oak Ridge National Laboratory in Tennessee.
Like most Americans, he owns a dryer. But he says he hates using it. He knows it's an energy hog, and it takes so long to dry anything.
Then, one day, he was thinking about ultrasonic humidifiers — a kind of portable room humidifier that uses high-frequency vibrations to turn water into steam without getting hot. And Momen thought: What if I use the same technology on a piece of wet fabric?
“The result was so amazing. It was like mind-blowing," he says. "In less than 14 seconds, I could dry a piece of fabric from completely being wet. If I wanted to do the same thing with heat, it’s taking somewhere between 20 to 40 minutes."
Momen’s current prototype looks nothing like a conventional dryer. It's basically a small circle of metal called a transducer that he plugs into a battery. He then douses a small piece of fabric in water and places it on top.
Ayyoub Momen's current prototype only dries a small circle of fabric. As soon as the transducer is plugged in, the fabric starts sizzling without getting much hotter.Emily Siner
The fabric sizzles and steams, and in about 20 seconds, it's dry. Momen says it uses barely any energy.
"This dryer technology has the potential to save somewhere [around] 1 percent of the overall energy consumption of the United States," he says.
Venkat Venkatakrishnan, director of research and development at GE Appliances, calls the technology a "big breakthrough."
"It is not very far-fetched, not very difficult to do," he says. "But it is not an idea that everybody thinks of, because there is a lot of science that goes into it.”
GE has partnered with Oak Ridge to help put the ultrasonic dryer on the market. They still have to test this technology on bigger batches of clothes and build a more sophisticated prototype. But, he says, "I think we are about four years away from being able to buy this dryer at a Home Depot or at Lowe’s or any appliance retailer.”
He doesn't know how much they'll cost yet, and people might not run out to buy what could be an expensive purchase. Still, Venkatakrishnan thinks consumers will be willing to pay more to dry their clothes much faster — and, of course, save money on their electricity bill.
There's really no other way to describe them — the toilets of Japan are fabulous, and, high tech.
"Let's say you don't want to lift up the lid yourself, because it's dirty," explains translator Kaede Kawauchi. "Then you can just use the remote control to press a button and then it just kind of lifts up."
In Japan, toilets come with remote controls.
Toto has customers work with "advisers" to help figure out which product is right for them. (Sally Herships/Marketplace)
And at the Tokyo showroom of Toto, one of Japan's largest toilet manufacturers, you can have your pick. If Apple built a toilet store, this is what it might look like — white and shiny, but cleaner. Nariko Yamashita, who works in public relations for Toto explains a complex looking remote control — one with 22 buttons.Sally Herships
She presses one and a tube appears from under the seat spraying water. Not only do these toilets have built in bidets, you can also, says Yamashita, adjust the water temperature, get a water massage, or choose a specific flushing option depending on how much toilet paper you require.
But most U.S. consumers haven't been to Japan and don't know there's a whole wide high tech toilet world out there — The high tech toilet is something that has to be tried to be really appreciated, says Bill Strang, president of operations for Toto in the Americas.
So why haven't high tech commodes taken off in the U.S. yet? In Japan, Toto had a big leg up, says Strang. The Japanese love having options and Toto's Washlet is probably the best known model. It's a toilet seat with features like a drier for your nether regions and the option to play sounds in case you need some sonic camouflage for your toileting activities.Sally Herships
The average price for a Washlet is around $600 but you still need a toilet and a tank. In Japan you can end spending as much as $2,700 on your toilet, and spend consumers do. Since Toto launched the Washlet in 1980 the company has sold 36 million units. Says Yamashita, 76 percent of Japanese households own one.
Even before the company went high tech it already was in the business of making toilets so consumers were familiar with the brand.
"I can tell you how this Washlet will work. I can tell you about the spray wand and how it's going to use a warm water wash to clean you off and how it will oscillate and pulsate and how if it doesn't hit the right spot you can move it around and get it to hit the right spot with that spray rinse ... I often say that I can tell you about the Washlet, but until you can actually test drive it and understand that experience you will then be able to say in your heart what it really brings to you in way of value," he says.
Says Strang, Toto's U.S. sales are increasing by 20 percent a year, so it's possible his pitch is working and that American consumers are now more carefully considering their commodes.
That's how many chickens were taken out by the last bout of bird flu that swept the Midwest. And now, poultry industry groups and government officials have been meeting in Iowa to prepare for the next possible wave of the disease, as migratory birds, the virus carriers, will take wing in the fall.22
That's how many buttons can be found on the remote control in Japan for ... a toilet. High-tech toilets have become popular in that country, but have yet to find a market in the U.S. But that may be changing. Toto, a popular brand, reports that U.S. sales are increasing 20 percent a year.20 seconds
That's how quickly Ayyoub Momen, a staff scientist at Oak Ridge National Laboratory, can dry a piece of cloth with his protoype for a clothes dryer that utilizes high-frequency vibrations to turn water into steam. The technology is being developed for a full-fledged appliance and has the potential to save 1 percent of energy consumption in the U.S.$75,000
That's how much Baltimore resident Michael Ghebru says he lost in liquor and food when his store, Doc’s Liquors, was looted during the riots surrounding the death of Freddie Gray. Some 50 rioters, including customers that Ghebru recognized, tore through his store in April. And due to laws about liquor stores in residential neighborhoods, he would also be out of luck when it comes to collecting insurance for his business from the city of Baltimore.
Something stinks in Lebanon. For a week, 3,000 tons of garbage per day have piled up on the streets, left to rot in the heat wave while Beirut sorts out problems with waste disposal.
The trash crisis prompted demonstrations and protests, and some residents burned garbage in the cans, sending toxic fumes into the already reeking city.
The government has reportedly come to an agreement to start picking up trash again, but even the solutions seem unsustainable. Waste is carted to new locations, shifting trash problem from place to place.
Behind the week of stench in Beirut is a road closure blocking Lebanon's Naameh landfill — an overflowing disposal ground that was initially supposed to be a temporary solution.
Brooke Anderson, a Beirut-based reporter for the BBC, says that part of Lebanon's trash problem is rooted in other systemic issues, including a lack of clean drinking water and a real recycling program.
"The tap water doesn't taste good enough to drink, so everyone drinks bottled water," Anderson says. "The bottles pile up.... It piled up very quickly."
Combine the extra-high amount of waste with a lack of a well-running recycling program, and the garbage problem grows and overflows into streets, slowing traffic and disrupting business.
For now, government-contracted Sukleen is back on the streets picking up the heaps of trash and carting it to undisclosed locations, but people in Lebanon are eager to find more permanent and sustainable solutions to an ongoing problem.
Volkswagen's very public goal has been to be the biggest car maker in the world. And it reached that goal in the first six months of this year, selling 5.04 million vehicles and moving past Toyota.
If you think of Volkswagen’s car brands as if they were part of a stock portfolio, it would be pretty diverse. And that’s a good thing, says Thilo Koslowski, vice president and automotive practice leader at Gartner.
"As a large company that owns multiple brands, it is important that you have to have a balanced approach,” he says, “a premium brand and volume brands.”
For Volkswagen, that volume brand is Volkswagen. Audi, another Volkswagen brand, has had very healthy profit margins. And, “a company like Porsche, which is also branded within the Volkswagen group, has the highest profit margin of traditional auto manufacturers that is out there,” Koslowski says.
But just because a car company is number one in sales doesn’t mean it’s making money, Steven Szakaly, chief economist with the National Automobile Dealers Association, says.
“Realistically it doesn’t really mean anything in terms of profitability, popularity of models,” he says.
Szakaly says Volkswagen’s aggressive global push adding factories and brands could work against the company: “A large system that produces a large volume of motor vehicles is also very expensive to run and it’s also very expensive to maintain.”
But that global expansion got it to number one. Mike Austin, editor in chief of Autoblog.com, says the company’s sales in China have been a major plus. In Europe, of course, it’s a slam dunk. On the other hand, he says the company is struggling in the U.S.
“They only have about 30,000 units so far this year,” he says. “It’s one-sixth the size of Toyota in terms of sales.” He says Volkswagen and Toyota are so close, it’s anyone's game for the next six months.
Microsoft is rolling out its new operating system, Windows 10, tomorrow. Analysts say the company is hoping for a smooth deployment that might mend fences with customers and businesses still bitter about the last big update in 2012.
Microsoft is giving the new operating system away for free as an update, a first for the company, trying to lure back consumers who gave up on Windows for mobile devices, says David Johnson, a principal analyst at Forrester.
“Microsoft faces an uphill battle here to win tablet users back to the Microsoft platform, and phones back to the Microsoft platform," he says. "So it’s by no means certain.”
Windows 10 aims to synchronize the PC and mobile experience, says Darren Hardman, COO for North America at Avanade. But he knows Windows 10 won’t send consumers flocking to buy Windows phones. Avanade is a Microsoft partner that helps deploy Windows software and other tech for large corporations.
“Absolutely we expect for the clients to continue using multiple sources of brands and devices — that’s just the world we live in," Hardman says. "And I think we’ll be successful, both Microsoft and Avanade, if we’re helping our clients support interoperability across devices into a strong Windows platform.”
Alan Lepofsky of Constellation Research says the focus in Windows 10 on allowing users to move "seamlessly" from device to device reflects a changing Microsoft that’s more responsive to consumers, and to the reality of how businesses use technology.
“I think we saw a decade of Microsoft a little bit stagnant," he says, "and I think in the last two to three years...it’s a new Microsoft.”
Consumer confidence is one measure of how we feel about the economy – and our confidence was way down in July.
You might think the Federal Reserve, which is meeting this week on interest rates, would be concerned with how we feel. But while feelings are important, on their own, an economy they do not make.
“Consumer confidence is a low-ranking indicator to policymakers at the Federal Reserve,” says Richard DeKaser, corporate economist for Wells Fargo & Company. “The Fed’s primary focus remains on two indicators: the labor market and inflation.”
That is, of course because the Fed is legally obligated to deal with the labor market and inflation. DeKaser says consumer confidence tends to follow these things, not predict them. And when it comes to feelings about the future, he says “people say one thing and then do another.”
“Consumer confidence measures don’t have such a strong link to economic performance,” says Carl Tannenbaum, senior economist for Northern Trust. “They don’t lead the way you think they might.”
But, he says “ignore them at your peril.” Just because the Fed doesn’t parse them , doesn’t mean your feelings aren’t important.
“We should care about feelings because consumers have been excellent predictors of recession,” says Lynn Franco, director of Economic Indicators for the Conference Board, a key source of consumer confidence data. “They can give us advance notice of when the economy is heading south.”
Consumer expectations tend to be a little ahead of the game when it comes to the bounce back from a recession, Franco says. She says consumer confidence is also "a good indicator of people’s willingness to buy.”
Northern Trust’s Tannenbaum says the Fed does pay attention to our feelings on some level, because they reflect how the Fed's message is being received.
“When the Fed communicates with the public, they’re figuratively trying to put their arm around our shoulders and assure us that what they’re doing will be something that pleases us all,” he says.
So consumer confidence is, in a way, also a sign of how well we feel the Fed is doing its job.