🤖 AI Summary
Overview
This episode delves into the complexities of November's inflation data, highlighting the challenges in interpreting the numbers due to missing data and holiday discounts. It also explores predictions for the housing market in 2026, the risks tied to AI infrastructure investments, and the diminishing influence of economists in shaping policy. Additionally, it examines efforts to reposition coal as a viable product in a changing economy.
Notable Quotes
- Uncertainty can be its own kind of economic drag.
- Laura Veldkamp, on the impact of incomplete inflation data.
- No one's ever right. And if they say they were right, they're lying.
- Rick Palacios Jr., on the unpredictability of housing market forecasts.
- Economists are useful to politicians until they're not.
- Andrew Prokop, on the waning influence of economists in policymaking.
📉 Inflation Data Caveats
- November's inflation rate of 2.7% was lower than expected, but the data is incomplete due to the absence of October's CPI and delayed November data collection (Henry Epp).
- Holiday discounts during Black Friday and Cyber Monday likely skewed the numbers, particularly for electronics and appliances.
- Shelter price growth appeared to slow significantly, but experts like Yelena Sholyatova caution these figures may not reflect reality.
- A weakening labor market and reduced consumer spending could contribute to lower inflation, but more data is needed to confirm trends (Anne Owen).
🏠 Housing Market Outlook for 2026
- 2025 was marked by high mortgage rates, high prices, and economic uncertainty, frustrating both buyers and sellers (Jake Krimmel, Daryl Fairweather).
- Experts predict modest improvements in affordability, with mortgage rates stabilizing around 6.3% and incomes rising faster than home prices for the first time since the Great Recession (Caitlin Tan).
- The market is expected to become more balanced, with neither buyers nor sellers holding a significant advantage (Jake Krimmel).
- However, new home construction may decline as builders struggle to sell existing inventory (Rick Palacios Jr.).
🤖 AI Infrastructure and Debt Risks
- Companies are taking on significant debt to build AI infrastructure, with global spending projected to reach $7 trillion (Nova Safo).
- These investments rely on future demand for AI services, raising concerns about long-term profitability and residual risks when rental contracts expire (Stephen Kaplan).
- Wall Street is increasingly skeptical about whether the current level of debt is sustainable.
📉 The Decline of Economists in Policymaking
- Economists have lost influence in political circles, with both parties turning to alternative sources of expertise (Andrew Prokop).
- Former President Trump dismissed traditional economic thinking, favoring a winners and losers
approach, while Democrats shifted away from neoliberal policies after the Obama era.
- Economists' inability to provide quick fixes for inflation and other economic challenges has further eroded their credibility.
🏗️ Repositioning Coal for New Markets
- Researchers in Wyoming are exploring alternative uses for coal, such as construction materials and soil additives, to counter declining demand for coal in power generation (Caitlin Tan).
- Efforts to rebrand coal as carbon ore
aim to overcome its negative environmental associations (Trina Eiglesrud-Pfeiffer).
- The state faces challenges in convincing industries to adopt coal-based products quickly enough to offset the rapid decline in traditional coal markets.
AI-generated content may not be accurate or complete and should not be relied upon as a sole source of truth.
📋 Episode Description
November inflation data came in lower than expected, according to the latest CPI report. But we can’t compare it to the previous month, since the BLS skipped several October reports. And data collection began late thanks to the shutdown, right in the middle of retailers’ Black Friday sales. In this episode, key caveats to the November CPI. Plus: Experts cautiously predict a more balanced housing market in 2026, tech stocks take a hit as data center debt climbs, and a growing number of politicians reject economists’ expertise.
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