Marketplace - The global trade status quo is shifting. Will the U.S. be left out?

Episode Date: January 20, 2026

After decades of globalization, the U.S. may be paying a political price: International leaders are forging new trade agreements independent of American influence. In this episode, as some countries no longer see the U.S. as a reliable trade partner, will the global economy leave America behind? Plus: Sellers outnumber buyers in parts of the housing market, Georgetown’s Dorothy Brown discusses her new book about reparations, and we preview Fed governor Lisa Cook’s upcoming Supreme Court hearing.Every story has an economic angle. Want some in your inbox? Subscribe to our daily or weekly newsletter.Marketplace is more than a radio show. Check out our original reporting and financial literacy content at marketplace.org — and consider making an investment in our future.

Oh, you were looking for macroeconomic stability, were you? Huh. From American public media. This is Marketplace. In Los Angeles, I'm Kyle Rizzdahl. It is Tuesday, today the 20th of January. Good as always to have you along, everybody. One does not have to be a trained observer of the international order.

To know that something is up, you can kind of feel things changing under your feet, right? Canadian Prime Minister Mark Carney said in a speech today at the World Economic Forum in Davos, and this is a quote, we are in the midst of a rupture, not a transition. The old order he went on is not coming back. Canada, in fact, made a big trade deal with China the other day. The European Union and the South American trading block Mercosur finally signed a free trade agreement that has been years in the making. And as President Trump threatens tariffs and more to take Greenland, traditional American allies are having an economic moment. Marketplace's Elizabeth Troval has more on how the tectonic plates of geo-economics are shifting.

Today, the U.S. is paying the political price after decades of globalization. This didn't happen out of a vacuum, says Rice University's David Gantz. A lot of people have been left behind, and governments have not done a very good job of dealing with the people left behind. from the shift in manufacturing elsewhere. But as Bill Reinch with the Center for Strategic and International Studies points out, President Trump's protectionism isn't stopping globalism. Trade is increasing, but it's rearranging or realigning. And what's happening is basically countries are moving on without the United States.

Look at the EU in South America, China and Canada, the UK and India. We're not a reliable partner anymore. And there's no better example of that than what he's doing with his Greenland tariff issue. So far, Americans haven't yet seen a major retaliation from our trading partners. But Reinch says decisions the U.S. makes today could hinder future economic growth. We're a mature slow growth economy. If companies here want to grow fast, they have to export. And what Trump is doing is effectively cutting them off.

from that. There's the global financial system to think of two. The Brookings Institution, Doug Redeker, says for now, there is no substitute for the U.S. dollar. But if you accelerate the rest of the world's search for an alternative, they're going to find one. And at that point, once the dollar ceases to be the dominant sole global trading and reserve currency, then a lot of things Americans have taken for granted start to go away. And of course, there's the impacts on American workers and businesses. It's literally prices. It's job opportunities.

It's availability. It is supply chain disruptions. He expects the U.S. is in store for more trade war-related pain, not less. I'm Elizabeth Troval for Marketplace. The global trading day started with a bond market route in Japan, and the volatility was off and running around the world. we will have the details when we do the numbers. There's no shortage of marketplace adjacent things to watch at the Supreme Court these days.

We are expecting a ruling any day now on President Trump's tariff-palooza of April last, specifically whether the president, any president, can tax American businesses and consumers just because he feels like it. And tomorrow, the court is going to hear argument on President Trump's attempt to fire-fed Governor Lisa Cook. Lots to watch, as I said, but what to watch for. Leah Lipman is a professor of law at the University of Michigan. Leah, it's good to have you back on. Thanks so much for having me.

We had you here a year or so ago before a big Federal Trade Commission case, Humphrey's executor, and who the president could fire when and if he feels like it or not. And I asked you about the Fed, and you said, and this is almost a quote, that you thought they were going to and you hope they would find a way to carve out a special thing for independent monetary policy. And lo and behold, that ruling comes down and the court says, the Federal Reserve is, and this is the quote, a uniquely structured quasi-private entity that follows in the distinct historical tradition of the first and second banks of the United States. So first of all, congratulations on your prescient. Second of all, though, we're going to hear that a lot

tomorrow with Governor Cook's case, yes? Yes, absolutely. And if only I could manifest everything the Supreme Court would do. But yes, so the case they're hearing tomorrow is the president is reporting to operate kind of within the strictures that they gave him. They said Congress can limit the circumstances under which presidents can fire governors of the Federal Reserve Board to what's called good cause. And the president is claiming to have good cause for firing Lisa Cook. And so it's really going to be about the extent to which the court is willing to review the president's claims to have good cause. And that's, of course, going to be bound up into, I think, there really felt need to continue to allow the Fed to make independent monetary policy.

So Chair Powell is going to be in the courtroom, the Associated Press reports. And obviously, one hopes that the justices honestly ignore his presence, right? He's there to support Governor Cook. It's tough, though, for them to ignore the atmospherics of the subpoenas that were sent by the Justice Department to Chair Powell and the Fed, and the talk of the criminal investigation, right? I mean, they can read newspapers. Absolutely. That is definitely going to be hanging over the argument, because I think what it underscores is the president is really not going to stop trying to drum up pretty dubious claims about why he has caused to fire any governor of the Federal Reserve that he doesn't like.

And so the fact that the president is basically trying to use. these cause exceptions to fire whoever he wants, it would be impossible for the justices not to acknowledge that and have that influence their thinking about the case. All right. So you're the lawyer in this conversation. You've got the Supreme Court experience. How are they going to get themselves out of this jam? Because they have given to the president, as we all know, extraordinary powers over who he hires and fires. They have. And my guess is they are not going to want to call him a liar. And this case, you know, is one of the ones. that tease up, you know, will they listen to the president's somewhat specious claims? I mean,

I don't think many people think he's firing Lisa Cook because of these allegations of mortgage fraud, just like many people don't. Sorry to interrupt. We should say those charges not only have been not charged, not proven in any way. I mean, they're just out there being bandied about. Exactly. They are just allegations. And, you know, ProPublica, their reporting has indicated that many people in the Trump administration have done exactly what, you know, Trump accused Lisa Cook of doing, which is listing somehow she purchased as a primary residence when, in fact, it wasn't going to be. But anyways, I don't think they're going to want to say that the president is lying. Instead, I think if they end up ruling for Lisa Cook, and I'm not sure they will, they will probably do so by saying the president didn't follow the statutorily or constitutionally required process for removing a governor of the Federal Reserve, because that would allow them to limit. his power and prevent this particular removal without having to call BS on his claims. Does give him another bite at the apple, though, right? Because he can come back now and say,

oh, I'm doing what you told me to do. It does. And you would hope that they would have learned their lesson from, you know, saying, oh, the Fed is different. You can fire everyone except for the Fed. So what does he do? He goes and fires, you know, a governor of the Federal Reserve. You would think that they would internalize the timeless tale of if you give a mouse a cookie. What is the mouse going to do. But it's not clear they will do so. And, you know, I think some of the things that they limited him from doing during the first Trump administration, for example, attempting to end the DACA rescission, the Deferred Action for Childhood Arrivals program, there they told him he didn't use the right process. And he didn't actually end up trying to do it again. Now, that was Trump

1.0. This is Trump 2.0, but it's a little bit hard to say that he would definitely try to do the same thing if they went this narrower route. Different topic, but since I have you on the phone, the tariff ruling did not come down today. We in the business and economic press are waiting for it like nobody's business. What's taking them so long? You know, it's hard to know. The usual rule is big cases and the tariff case is a big case. Usually those cases end up being decided at the end of the Supreme Court term, which would be in June.

Now, we all think this case could be decided more quickly, in part because as these tariffs can continue, you know, the government is accumulating additional debts. It may have to pay back. But I think the reality is the normal course would be for this case to take longer because the justices are probably disagreeing. And this isn't a question they have decided before and on which there is a ton of precedent. But I certainly wish they would hurry up and get this one out, especially as, you know, he just threatened additional tariffs related to Greenland. So, please, please weigh in. Leah Lipman is a professor of law at the University of Michigan School of Law.

She's also a podcaster. It's called Strictney. You should listen to it. And she's an author, too. Her book is called Lawless. Leah, thanks a lot. I appreciate this time. Thanks for having me.

There was some data out today from Redfin, the real estate brokerage, that shows that nationally December was a buyer's market. More sellers out there than people looking to buy. 47% more across the country, says, Redfin. When you get down to brass tax, though, the housing market is very, very regional. Marketplace is Carla Javier has more. It's almost as if sellers and buyers are living on different planets, says Chen Zao at Redfin. They're finding a hard to find common ground on price. Sellers want to make money, and buyers nervous about the economy and facing high mortgage rates

are hesitating to pay that much. Zao says if that continues, there won't be a lot of activity. And it also does mean that there is some downward pressure on home prices. Redfin says this imbalance is particularly strong in the Sun Belt. Matthew Typhke owns brokerage, property management, and investment companies in Austin, Texas. He says before, houses were going in hours. It's just coming from like craziness in the market for a while. You know, you were bidding 100, 200, 300 over. There's 50 offers.

And that just wasn't normal or sustainable. Now he says homes take around three or so months to sell. Vika O'Grady, who analyzes the housing data for Unlock MLS and the Austin Board of Realtors, calls these conditions a return to normalcy and says sellers will have to be patient. Most of them will still probably make money, but they may not be making those sort of record-breaking figures that were out there a few years back. And while the market may be tilted towards buyers, O'Grady says, There's still demand for people who want to move to Austin, and some of those sellers are going to become buyers again. 2025, she says, was a year of adjustment.

But if, say, job growth returns to Austin this year, she thinks that would help the market be more in balance. I'm Carla Javier for Marketplace. Coming up. During this slow period is when I do all of the planning for the year. Don't sound so slow. First, though, let's do the numbers. Dow Industrial's down, 870 points today. Yes, indeed, the wah-was 1 and 3 quarters percent.

48,488. The NASDAQ down 561 points. That is 2.4%. Finished at 22,0954. The S&P 500 gave back 143 points, 2%. 6796 there. Big Tech is just one of the industries that were rattled today, looming trade war with the EU.

Take your pick. There's a lot going on out there. Invidia declined 4 and 3 tenths percent. Tesla skitted 4 and 2 tenths percent. Oracle down 5.8 percent alphabet, off by 2.4%. Bond prices went down. The yield on the 10-year T-note rose to 4.29er percent. You're listening to Marketplace. This is Marketplace. I'm Kai Risdahl.

I try to make a point of it every month when the jobs report comes out of highlighting the disparity between the overall unemployment rate in the United States, 4.4% as of the December reading, and the unemployment rate for black Americans, 7.5% last month, 7.5%. Employment numbers, though, are far from the only thing setting black Americans apart in this economy, both historically and today.

And the idea that maybe we ought to do something about that is not new, but it is perhaps under-explored. Dorothy Brown is a professor of law at Georgetown University, She's also the author of a new book called Getting to Reparations, how building a different America requires a reckoning with our past. Professor Brown, welcome to the program. I'm good to have you on. Thanks so much for having me.

I was surprised to read it in this book, Professor Brown, that you are a convert on this project on the idea of reparations. Yes, I came to this as a skeptic, as, oh, it'll never happen. Why are we even talking about this? And then one day one of my former Emery colleagues mentioned that we, the federal government, paid reparations to Italy for Italians lynched in Louisiana. And I said, wait a minute. We've paid reparations for lynching, but not black Americans. And she said, that's right.

And that's when I started digging. And the rest, as they say, is history. Speaking of history, it is, this may be pejorative, but you correct me, it is not a popular topic. Not too many people want to talk about it. When it does get talked about, it's very uncomfortable. And I guess my question for you, as you start on your book tour and try to get this message out, this does not seem like a welcoming time for the idea of reparations for black Americans. So let me tell you while I'm excited about getting this book out now, Republicans control the presidency, the House, and the Senate. They got elected based on identity politics. As a result, they're going to double and triple down and do bad things. So I believe white Americans of goodwill we're seeing it in Minnesota, see we do not live in a post-racial society. Learning the history of what happened to black Americans after Slash, Slash,

slavery ended is what we need to be talking about now. You have a messaging issue here, right? You're going to have to convince people. You're going to have to do a little marketing, if you will, on this idea. It interested me to read that you hired or went to a strategic communications consultant to figure out how to do this. Yes, I have a plan for that, right? So we were able to move people, just like myself, who started as skeptics or even

opponents of reparations to support when two things happened. When we showed them the four prior examples where the federal government paid reparations, one, white enslavers got money from the federal government for freed slaves in the District of Columbia. Again, the Italy reparations case, we paid compensation to tribal nations for land theft and economic exploitation. And finally, we paid compensation to Americans of Japanese descent who were mass incarcerated during World War II. So when people hear that, things that happen to Black Americans, but Black Americans never receive payment for, they go, wait a minute, that's not fair. And then, when they learned the history of race in America, that the 13th Amendment didn't fix much,

combined that with our history of paying reparations convinced skeptical people to become supporters. So the messaging really bore out the arguments I was making in the book. One of the biggest sticking points, and you talk about this, is deciding what reparations look like, how to distribute them, where the money goes, to whom the money goes. How do you sort that? Those questions are so important and so fraught. So, my solution is to have a commission to study it. So you're like, a commissioner where good ideas go to die, Dorothy. Well, not my commission. We had one of those here in California, ma'am. I mean, you know. Right. And there are commission, there are recommendations. Some of those recommendations have become

law. Some have not. My argument is the next Democrat, who's elected president on day one, creates the commission by executive order. Because here's what I know. We have no idea how much this is going to cost. And that's not a negative. We don't know because we haven't studied and the plunderer didn't keep accurate records. Think about how black Americans were treated in the 20th century. Their land was taken. They were lynched. So part of what the commission is going to do is unearth all of those stories and give all Americans an opportunity to talk about the harm that the government has inflicted upon them and how the government needs to remedy it. With all respect, truly, isn't it easier for you to say we don't know how much it's going to cost

because as soon as you start throwing a dollar amount around, people start freaking out? You know, yes and no. If I had a dollar amount, I'd say it because I'm not afraid of the truth. but no one, I mean no one, has done an accurate assessment of what happened to black Americans from the day after the 13th Amendment was enacted through 2026. Nobody. Fair enough. One more thing, and I guess this is more personal than analytical. You say several times in this book that you had to get up and walk away from the research from time to time because this is hard history, all this stuff you're talking about. And I guess I'd just like you to talk about that for a second. Yes. So when I figured out what really happened to black Americans after the 13th Amendment freed all the enslaved people is no matter where we went, we had targets on our backs. And reading about these stories was so painful and so hard that I literally had to get up and walk away.

And at one point, I thought I can't finish this book. And then it's if my 94-year-old mother like slapped me and said, we lived it, you get to write about it. And that's what got me back to the book and actually has me excited about a book called Getting to Reparations in 2026. You got the title of the book. It's called Getting to Reparations. Dorothy Brown wrote it. She's a professor of law at Georgetown. Professor Brown, thanks for your time, ma'am. It's always good to talk to you. Thank you so much for having me. There's a bunch of data coming out later this week.

There's an update on gross domestic product for the third quarter. A delayed look at PCE for November. That's the one that the Fed likes. Speaking of which, the Fed, they meet next week. But that's all big picture. Very big picture. For now, though, how about something on the more personal side? Annie Lang Hartman runs the gift and stationary store Wild Letty up in Lelandau County, Michigan.

Here is our retail update. For the past few weeks, the first few weeks of January, Wild Lettie, has been pretty quiet, which honestly I completely expected. But also, during this slow period, is when I do all of the planning for the year, or at least 90% of the planning. Throughout the year, I'm just constantly gathering ideas. So I have notebooks, notes on my phone. I've, Google Docs just full of ideas. So the first week or so of January is when I go through and look at those ideas and try to figure out what is feasible to do for the year. So I have a nice working list of things I need to draw, things I need to letter new products to try to find responsible

manufacturers for. And it's a long process, usually January through April. That's what I'm doing constantly. A lot of our manufacturers do provide mock-up services, so I am able to look at things before they go into production, and I really do use those tools to get feedback from friends who are really great customers, and my manager, Megan, who's been with me since 2020, and she will tell me, yes, this is great, or no, this doesn't work. I don't think our customers would like it. We're doing all right. We're actually doing really, really well. We're getting plenty of online orders and our costs are covered for the slow months. So the biggest thing really is, I always do this every single year. I have more ideas than we have time to make

happen. I have time to draw. I mean, we're a small business. I don't have a ton of capital to put every single idea that I have into production. So just working through all these ideas and seeing what makes sense and having to let some really fun things go, hoping that I can use those ideas down the road. Ain't that always the hope, though, huh? Annie Lang Hartman, the store is called Wild Letty. It's up in Lillano County, Michigan. This final note on the way out today in which correlation is once again not

causality, but man, sometimes it's a close call. You might have seen at some point today that there's a Danish pension fund that is unloading its holdings of U.S. Treasury bonds. The firm, which is, to be clear, not a government-controlled fund, said it's selling because of, and this is a quote, poor U.S. government finances, which is not wrong. But watch this space because there is lots of chatter about Europe disentangling itself from American bonds, of which it is a huge holder because of, you know, everything. Jordan Manjee's and him, Maharajana, Winnah, Oxman, and Virginia K. Smith are the digital team. I'm Kai Risdahl. We'll see you tomorrow, and this is APA.

Hey, everybody, it's Kai Risdahl, the host of Marketplace. It has been a year since the fires here in Los Angeles, and businesses that burned are still struggling. You know, I won't lie. I've looked. I've looked at, you know, hey, maybe, Maybe we moved the store. It just, it wouldn't be the same hardware store. On the ground reporting and what the year ahead has in store for business owners still recovering, listen to Marketplace on your favorite podcast app.