Retail sales fell unexpectedly in July

**SPEAKER_1** (0:00)
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**Novasafo** (0:31)
The American consumer lost some steam in July.
From Marketplace in Los Angeles, I'm Novasafo in for Kimberly Adams. Good morning. Retail sales unexpectedly fell last month, down by a significant amount, 6 tenths percent. Forecasters were calling for a slight advance, but the Census Bureau's data released this morning shows consumers pulled back as tax refund payments ran out. Christopher Lowes, chief economist at FHN Financial in New York, he joins me now. Good morning.

**Christopher Lowes** (1:00)
Good morning.

**Novasafo** (1:01)
So Chris, the headline number down 6 tenths percent, is that worrisome?

**Christopher Lowes** (1:06)
It is. I mean, for starters, it's the first decline in a while. So I guess in a sense that's good news, but a 6 tenths drop is really big. And there were declines in most of the major categories of retail sales and it's not, you know, normally when we see this kind of weakness, it'll be in auto sales, for example, which are big ticket and they're financed over time. And people respond to pricing and that kind of thing.
That's not what it was this month, even excluding auto sales were down. It looks like people are finally pulling back after months and months of really aggressive energy price increases.

**Novasafo** (1:55)
And what does that mean going forward? The Fed, lots of talk about potentially raising rates to tame inflation. Does this change the picture?

**Christopher Lowes** (2:04)
Well, certainly the pressure from the bond market is gone. Bond traders have been saying the Fed is late, should have raised rates at the last meeting or even the one before that. The pressure is fading. Inflation has come down the last two months.
And now we find out that resale sales are weak as well. So the justification for a rate hike, you know, the pressing need to slow the economy, well that's clearly no longer an issue.

**Novasafo** (2:36)
Christopher Lowes, Chief Economist at FHN Financial in New York. Thank you very much.

**Christopher Lowes** (2:40)
Thank you.

**SPEAKER_4** (2:57)
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**Novasafo** (4:27)
Americans have started to lose Medicaid coverage as new requirements kick in under the Republican Tax and Spending Law enacted last summer.
Most states will begin to remove people from the government-run health insurance program for low-income and disabled people starting on January 1st, but Nebraska is getting an early start. It terminated coverage for roughly 200 recipients this month. Dan Gorenstein has been following this. He's the founder and executive editor of Trade-Offs, a nonprofit news organization that covers health policy. Hi, Dan.

**Dan Gorenstein** (4:58)
Hi, Nova.

**Novasafo** (4:59)
So can you start by reminding us what these new work requirements are and who they apply to?

**Dan Gorenstein** (5:05)
Sure. The new requirements apply to roughly 20 million adults in 44 states who are part of the so-called Medicaid expansion population. These are generally low-income adults without kids. And starting January 1st, this group will have to prove that they are working or volunteering 80 hours per month, or that they're in school or job training just to have coverage.