When unemployment becomes endless

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**Kai Ryssdal** (0:30)
It's going to be tough, but we're going to try to say the phrase bond market no more than five times in the program today. From American Public Media, this is Marketplace.
In Los Angeles, I'm Kai Ryssdal. It is Friday today. This one is the 21st of August. Good as it always is to have you along, everybody. It has been a week in this economy. I will tell you that. So we're just going to start. Anna Swanson is at the New York Times. Sudip Reddy is at MSNOW. Hey, you two.

**Becky Trout Fricksell** (1:08)
Hey, Kai.

**Sudip Reddy** (1:09)
Hey, Kai.

**Kai Ryssdal** (1:09)
All right. Here are the rules. I get to say, this one doesn't count. I get to say, bond market, three times because it's my show. You each get to say it one time. So proceed accordingly.
But Anna Swanson, the first question goes to you. It's not about that part of this economy. It's about the trade part of this economy. I would like you please to crystal ball for me where we are in the trade war with our neighbor to the north, the deadline being like this weekend, right?

**Anna Swanson** (1:33)
Oh, nice. So I can save my B market reference.

**Kai Ryssdal** (1:36)
Yes, yes.

**Anna Swanson** (1:37)
Okay. So yeah, I have been covering Canada negotiations this week, and if there's anything that Trump loves as much as tariffs, it's these ticking clocks. And we've had a couple of them with Canada. Tariffs on about $20 billion of Canadian goods were set to go into effect Tuesday at midnight, but Trump delayed that for three more days for negotiations. Now the deadline is tonight at midnight. We still don't know what's going to happen as of taping. And it's hard to predict with Trump, but it seems like the US is optimistic. They have some kind of deal to stop this. So the talks have been a lot about kind of the tit-for-tat measures that the two sides have been putting on each other over the past year after Trump initially put tariffs on Canada. But I think it's important that this is also kind of laying the groundwork and beginning to address some of the issues in this bigger negotiation that's going on this year over the North American Trade Agreement.
And US officials want to wrap up those talks before the end of the year. So I'm going to be following that. I'm going to venture this is not the last tariff deadline that we're going to see on that this year.

**Sudip Reddy** (2:46)
Yeah, yeah, you think?

**Kai Ryssdal** (2:47)
All right, fair enough. So that's Canada. Sudip, here comes the first of my references to the marketing question.
We're going to spend more time than we usually do on the podcast, talking about the Treasury Secretary. Secretary Besant tried real hard to intervene in the bond market this week as the yield on the 30-year hit 5.3 and change percent, which is very high. The market doesn't seem to care what the Treasury Secretary thinks. Discuss, please.

**Sudip Reddy** (3:11)
The market realizes that this Treasury Secretary knows what it's like on the other side of government interventions. You can't bring a water pistol to a bazooka fight. And they know you can't use $4 billion in a $2 trillion deficit where the government's borrowing this much money and think you're going to actually have a meaningful impact. What they want to see is actual credibility from the people who were there. This is, it's not the same as the problem that the Fed has, where there was a lot of confusion about what's the actual future course of Fed policy with dealing with inflation. But in this case, the credibility is not that high. There were promises that inflation would be lower than it is. We're running well over 3.5 percent.
Promises that deficits would be lower than they are. We went through all that doge nonsense last year, and we have a 2 trillion deficit. After all of those empty promises, there were promises of higher oil production that we've had. And obviously, the direct result of the Iran War, inflation is higher, sending bond yields higher, it's a problem all over the world. That is, that needs actual solutions, and you can't just do a one day intervention and think that's gonna have any lasting impact, because it won't.