Marketplace - U.S. Treasurys aren't selling like they used to

Episode Date: April 8, 2026

The share of U.S. debt held by foreign countries has been shrinking. Foreign investors currently hold about 30% of federal public debt, down from nearly half. In today’s episode, we explain why the rest of the world isn’t picking up the U.S. tab anymore, and how that’ll impact American consumers and businesses. Plus: Three tech giants are eyeing initial public offerings this year, and Delta Airlines reported high earnings — and higher fees. Also, before inflation reports drop this week, learn why the PCE is slower than CPI. And finally, discover this hidden driver of the music industry.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.

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Wayfair, every style, every home. You know what we need right now? A little macroeconomic analysis. That's what we need right now. From American public media. This is Marketplace. In Los Angeles, I'm Connie. I'm Rizdal. It is Wednesday. Today, this one is the 8th of April. Good as always to have you along, everybody.

Well, here we are, the day after. A moment, despite all of the continuing unknowns of both the known and unknown variety, to perhaps take stock of where things stand. To do that, we've gotten Muhammad Al-Aryan on the phone. He's a professor at the Wharton School at the University of Pennsylvania, also the chief economic advisor at Alianz. Professor El-Aryan, welcome back to the program. sir. Thanks for having me on. The answer to this question will obviously be different than it would have been yesterday at this time. But I wonder, given the events of the day, the week, the month, your short-term, medium-term thoughts on the global economy. Wow, that's a really difficult question because there's so much uncertainty about the war. But let me think in terms of the four phases. And we are now, the U.S. in phase two and phase three elsewhere. While we started

the year well, we got a massive shock in the shape of the war. We had the first phase, which is done, and we are living with it higher energy prices than would have been otherwise and higher interest rates than it would have been otherwise. We then got phase two, which is more inflation in the pipeline. That's where the U.S. is now as the largest economy. Parts of Asia, unfortunately, have moved to phase three, which is not only you get phase one and phase two, but you also get demand destruction. So you start worrying about economic growth. And of course, phase four, which I hope we never get to, would be financial instability undermining the economy. So we are looking at a world in which the U.S. outperforms the rest of the world. And parts of the rest of the world, Asia in

particular parts of Europe with recession. A word here about the United States doing better than most of the rest of the world. You wrote the other day, a piece, the headline of which was America should beware of economic hubris. And setting aside for a second the fact that hubris is basically American government policy now in virtually all areas, what do you mean by that? So Americans are proud and rightly said. so that we are energy independent. As such, we don't have to worry about physical supplies.

But this sort of shock, Kai, hits virtually every single country. So the warning I was trying to send out is don't think that relative matters as much as absolute. Yes, the U.S. will outperform other countries, but in absolute terms, there will be higher inflation, there'll be bigger affordability crisis and some segments of the population are going to feel income insecure. So let's not celebrate too much our relative outperformance because ultimately it's the absolute performance that matters to people, especially people in the low income segments of the household. Step back for a minute then and talk to me about America's place in this global economy because it certainly seems self-evident and there are those who will disagree when they hear this.

but America's place in the global economy has been intentionally lessened by the Trump administration through its policies, tariffs specifically, but also, at least incidentally, by this war and how it's been conducted and what it has done to the global economy. So what are we looking at now in a global economy where the American position is lessened at best? The U.S. is still at the core of the system. Well, that role is being eroded. It started in 2008 when the global financial crisis originated in the U.S. It has continued with the weaponization of tariffs and investment sanctions, and this war is eroding it further. Now, the good news for us is there's no one to replace us.

You cannot replace something with nothing. Europe can't step in, China can't step in. However, what's happening is that, Countries are slowly building little pipe sky around the core, which is the U.S. And that means that if this continues, the U.S. ability to inform and influence outcomes is going to come down. The U.S. ability to take advantage of its reserve currency status and our deepest financial system in the world, that advantage will come down, and the U.S. will be worse off than it would have been otherwise. That seems bleak.

The good news is there's a long runway because there's no one here to step in. But you have to be careful. And I didn't even mention that our fiscal position is bad and getting worse. We're now looking at a fiscal deficit as high as 7% of GDP, which is very high when your unemployment rate is as low as 4.3%. How long is the runway, sir? And look, I asked – sorry, I ask this not to be a down. but it took us winning a world war, helping to win, and 80 years of crafting policies that greatly favored the United States. And now we have here, in the space of, as you just pointed out,

something less than 20 years, started to tear it all apart. Yeah, and answer to the question is hard because these dynamics are nonlinear. It takes a lot longer than you expect to begin with, and then it happens a lot faster. You know, we used to be. respected for two principles. One is what was called the Washington Consensus. It was very simple. If you want to prosper, follow America, liberalize, deregulate, be fiscally responsible, and respect the independence of your central bank. We no longer lead on the Washington Consensus. We also led the globalization process. And now we are the leader in undermining the notion of globalization. At best, we will end up with some type of managed globalization light.

So we no longer have these unifying themes that the U.S. used to lead, and they were good for most countries, but they were certainly good for the U.S. Mohamed Alarion is a professor at the Wharton School at the University of Pennsylvania. He's also the chief economic advisor at Alianz. Dr. Alarion, thanks for your time, sir. It's always good to have you on. Please call me, Muhammad. you. Tenuous, though that ceasefire seems to be. Traders just didn't care. We'll have the details

when we do the numbers. Not that we need more items economic to keep our eye on right now, but we've wandered into earnings season for the last quarter, January to March, which was, oh, how should I put it? Interesting. Also challenging for corporate America. Delta Airlines reported this morning a bellwether of the travel industry and also a company that is smack in the crosshairs of all of the war's disruptions. Soaring jet fuel prices, consumers jittery about geopolitical conflict, and that shutdown-induced hours-long lines thing we went through at TSA. How then did Delta do?

Well, pretty darn well, actually. Marketplace is Mitchell Hartman explains what's going on there. Delta's certainly not immune to developments in the Strait of Hormuz and soaring jet fuel prices, says analyst Nicholas Owens at Morningstar. They did say they had $2 billion of incremental fuel cost, and the price per gallon is almost double what it was a year ago. And the airlines responding aggressively, says Alex Fasiano at CFRA Research. Delta plans to raise airfare, raise baggage fees. And that's not likely to drive away too many customers, says Nicholas Owens at Morningstar.

Delta is the most profitable North American airline, and that gives them some cushion to absorb the temporary hit from spike in fuel cost. A big reason is Delta's relatively affluent customer base. In Q1, its revenue at the front of the plane, so the fancy seats was up 14%. They're seeing persistent demand. People are paying the higher fares. They have these premium seats and a well-heeled, less price-sensitive customer. So what about the other major U.S. airlines?

They're dealing with the same soaring jet fuel costs, and they're more dependent on selling economy seats. Some are also raising their prices, which could turn off inflation-stressed consumers, says Johnny Sawyer at public opinion firm Ipsos. He points to a recent poll that found two in three Americans spending less on experiences. Lower income Americans were definitely more likely to say that they'll either avoid booking just by plane or just cancel their trips entirely. Different pattern emerging for higher-income Americans, though. According to Morning Consult, their spending on airfare and hotels shot up in March. Senior economist Sophia Bague says geopolitical conflict clearly isn't much of a deterrent. Some people don't see this conflict that's here to stay. And so it's just a blip

and they're just continuing to behave as normal. And plan their summer vacations. I'm Mitchell Hartman for Marketplace. We, the United States, that is, spend way, way more than we take in. The way cover that shortfall, the deficit that accumulates every year and that adds up to the national debt, the way we would cover that is by borrowing a lot. And who the Treasury Department borrows from does make a difference. Over the past couple of decades, the share of U.S. government's spending being backrolled by foreign countries has been falling. And as marketplace Supreme Benichael reports, that affects almost everyone in this economy. The U.S. is $31 trillion in debt to the public. That is, for reference, about as much.

as the entire U.S. economy produces in a year. We owe about 30% of that to other countries and foreign investors. Here's the thing. It used to be almost half of all publicly held debt. Shaya Kabas is with the bipartisan policy center. The rest of the world is not propping up U.S. spending like it used to. One reason is that there's just a lot more of that spending. There's been an explosion in the amount of U.S.

government debt outstanding. Tony Rodriguez is head of fixed income strategy at Nouveen. Think about all of the fiscal stimulus and tax cuts that we've seen over the last five to 10 years. The U.S. borrowed a bunch to deal with the great financial crisis. Then we borrowed a bunch to deal with COVID. Meanwhile, tax cuts and we're still borrowing. Foreign governments have just been like, we're kind of good on the lending you money.

Like we will lend you more, but not that much more. Also, U.S. debt is looking a little more suss these days. days. The U.S., you know, their fiscal sustainability has been called into question with debt rising as much as it has. The U.S. has been downgraded by a couple of rating agencies. So foreign governments have been diversifying. Is there anything else we can buy so we don't have all of our risk in the U.S. story? Daniel Girard is with state street markets. You know, China has expanded into British debt, into European debt, and into gold a lot more. Foreign investors have also been putting money in stocks instead of treasuries, especially

when interest rates were really low there for a while. So lots of reasons the rest of the world hasn't been bankrolling the U.S. federal budget as much as it used to. So then, where is the money coming from? Again, Shia Kavis. We've been writing IOUs faster than the rest of the world wants to collect them. And that means that more of those Treasury securities are being purchased domestically. America has been borrowing more from America, from banks, from U.S. investors, even from the Fed recently, and to get U.S. investors to go along and buy all those treasuries, the U.S. government has had to pay up more than it otherwise would. And when the U.S. government has to pay higher interest, so does everyone else.

Americans in households and businesses across the country are paying more for everything from mortgages to auto loans to credit card debt because all of those are based on U.S. treasury rates. So somebody's got to pick up the tab here, and if it isn't the rest of the world, it is us. In New York, I'm Sabree Beneshore for Marketplace. Coming up. We all have our guilty pleasures. Love Island is mine. I got nothing on that, I'll tell you.

First, though, let's do the numbers. All right, here you go. The really happy music, because we'll get to that in a minute, but read the room, right? Downd Delt rolls up 1,325 points today, 2.9%. 47,909. The NASDAG surged 617 points, 2.8%. 22,635. The S&P 500, 165 points to the good, 2.5% 67 and 82.

Bond prices fell just a little bit. Yield on the 10-year T-note rose just a little bit, 4.30%. That actually is pretty steady. You're listening to Marketplace. If you're a business leader, Intuit QuickBooks payroll is an essential tool that completely integrates payroll, time tracking, HR, and your financials in a powerful all-in-one command center. No more juggling platforms or switching between vendors. All your data synced into one platform offering clarity and confidence to make smarter decisions and focus on what matters.

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This is Marketplace. I'm Kai Rizdahl. PCE, the personal consumption expenditure price index, and CPI, the consumer price index, are this week's big inflation data points. They come tomorrow and Friday. PCE is going to be based on February data. CPI is going to be from March. Marketplace of Samantha Fields explains that lag and why it matters, especially in moments of, oh, I don't know, volatility like this. Collecting data for the consumer price index is pretty straightforward if time-consuming, Economists go to stores make phone calls and scour the web to check prices on thousands of items and services.

The PC price index is more complicated. Bill English at Yale School of Management says that's because it's not just looking at the prices consumers pay. For example, for medical care, the CPI just picks up your co-pay, that you're out-of-pocket expense when you go to the doctor. The PC index has to capture all of the costs paid by your insurance company or the government. And getting that data from companies in the government can take a little while. PCE also includes price data from CPI, so it's just inevitably going to come out later. We get this lag, but we also get this quality, right? Amy Geisinger at Lafayette College says quality is important.

The more information we have sooner is better, right? The bed wants the information to make decisions. And what we have here is this like tug and pull between being fast and being kind of comprehensive. CPI is faster. ECE is more comprehensive. Carola Binder at the University of Texas at Austin says having both, along with private data, is helpful. If you have a lot of different inflation measures, they're all a little bit noisy. You're looking for that trend that they're all sharing, and that's going to give you a better idea of what that kind of true underlying inflation is doing.

Getting a good idea of what inflation is doing in real time is particularly important in volatile moments like now, with a war and oil prices rising. But Binder says it's hard. You kind of think, well, we know what's going on in the economy right now. The hard thing is predicting the future. But it's actually hard to know what's going on right now. The more data sets you have, though, the closer you can get. I'm Samantha Fields for Marketplace. It's been a good long while since a company with just a ton of hype.

Think like Facebook or maybe Uber has offered its shares on the public markets for the first time. But all signs are that 2026 is going to be. different three big-name tech companies are eyeing initial public offerings this year. There's SpaceX, the Elon Musk-led company that launches rockets and runs satellites and also owns Musk's entry in the artificial intelligence wars. There's Anthropic, the company behind the AI platform clawed and OpenAI, which makes ChatGPT. All three have already raised billions of dollars from private investors. They're aiming for more, though, in the public markets, as Marketplace's Henry App reports. Investors have generally been a bit more risk of

this year, which is not a great sign for companies looking to go public. But Avery Marquez at Renaissance Capital says investors are still interested in certain IPOs. You either have to be in the right industry or you have to be the right name. SpaceX, OpenAI, and Anthropic each check those boxes. They're huge names, and they're all involved in an industry that investors are still pretty bullish about, artificial intelligence. These are the first really recognizable big name AI companies. companies coming to market. And everyday investors want a piece of them. These big companies need more money, even after raising billions from venture capital and other private investors, says Sarah Kuntz at Cleo Capital. To some extent, they've sort of knocked on every door in private capital, and it's kind of time for them to move on to a different source of capital. And the next place to find it is in the public market. Plus, those private investors in these tech giants, they're itching to cash in some of their shares, which is,

have risen in values, as Kyle Stanford at Pitchbook. And that's harder to do if shares in a company aren't publicly traded. They're used to being able to get in and get out when they need. And so at some point, those are the investors that really need to get that liquidity. One more factor, interest rates. Stephen Blitz at Global Data, T.S. Lombard, expects them to rise in the next year. This is probably one of the cheaper moments in which to do an IPO versus a year from now. When there will still likely be demand for these mega IPOs, he says, it just might be more expensive for companies to get all their ducks in a row.

I'm Henry App for Marketplace. Love radio and audio, though I do. The truth is, we live in a video world now, TV, YouTube, TikTok, and all the other short-form vertical platforms that are in front of our eyes and our ears every day. I said it ears there because all of those video formats need just the right kind of background music to make all those emotional beats land the right way. That music, it turns out, is its own category, sometimes called sync music. You've heard it on this show too. Ryan Bradley wrote about it in the New York Times Magazine the other day. Ryan, welcome to the program.

Thanks so much for having me. I would like you to tell me, please, how you fell down this particular sync music rabbit hole. Yeah, of course. So I noticed a weirdly specific pop song while I was watching Love Island in a dramatic moment. Well, let's set aside the fact that you're watching Love Island. But anyway, go on. You know, it's fine. We all have our guilty pleasures.

Love Island is mine. And I shazammed it on my phone as you do. And nothing came up. And I'm kind of a music nerd. So I was like, strange. What is this pop song? And I started poking around and I couldn't find it anywhere. and then I started asking around, and that kind of opened up the door of this sync music world,

and eventually through some calls and reporting, I found the folks behind the track, and then went on to profile that company and go down this whole rabbit hole of sync music. And a rabbit hole, indeed it was. Tell me about this industry, because, you know, I've heard that music, and I'm like, hey, that's cool song. And, you know, as I said in the introduction, we use some of it here. So it's, but it's an entire industry. It's like a whole business thing.

So as I started reporting, I was like, oh, cool, this will be a neat kind of corner of the music industry. And really early on, one of the musicians I talked to was like, no, let me stop you right there. It's not really the corner. It kind of is the music industry for a whole lot of working musicians. Even artists that you've heard of, either dabble or their day job is making sync music, making music to be scored to video. A lot of really serious musicians, kind of take this as their nine to five. Well, on that day job nine to five thing, it lends. a certain stability to what otherwise has been for generations and generations, like a sort of

gig music, side hustle, you got to really, really, really get out there and do your own thing, lends a stability to that sort of business. Absolutely. And I mean, I would say more so now, even than in generations past, music is a really, really hard way to make a living. Even the biggest pop stars essentially use their album as marketing for their tours and only the biggest stars really make money on tours. So that was the other thing that really drew me to this. I'm fascinated by how creative people cobble together a living. I mean, as a freelance writer, it's a big part of my day-to-day. So talking to folks about how they make it work is always fascinating to me. You know, I heard the conversation between you and Livy Bredet, who produces this

piece, or is producing this piece before I actually jumped on the line, talking about how you hope it continues to be real people. And I mentioned that because the tendency here might be to say, oh, look, AI can do this and why do we have to pay these people to do this? Right. And I think that's sort of inevitable and that's already kind of happening. I was sort of worried as I started reporting that, oh, the secret sauce to this is going to be AI. And the truth is a lot of these artists are using AI to make their process faster, kind of on the back end. But at the heart of it, Music is about producing an emotion and it's about feeling and it's about catching a vibe. And I still think at the high end of sync and even the middle ground, you cannot do better than people.

Sure, people are going to try to make it cheaper and faster and buy non-humans, but I got to say, I'm just, I'm not interested. Amen, I'm with you there. I probably should have asked this question at the beginning, but I'll ask it at the end. SYNC, sync, music, what does that mean? S-Y-N-C, Sink. Where did that come from? comes from just sync to video. So if it's music made to be cut to video, synced to video, then it's sync music.

Ryan Bradley, freelance writer, most recently in the New York Times writing about sync music. Learn something new every day in this job. Ryan, thanks a lot. I appreciate you, time. Kai, thank you. This final note on the way out today in which we did a quick perusal of the minutes of the most recent meeting of the Federal Reserve so that you don't have to. do. Here's the money, quote, the vast majority of participants noted that progress toward the committee's 2% objective could be slower than previously expected and judged that the risk of

inflation running persistently above the committee's objective had been increased. I do not have to translate that for you. Do I? Do I? Our media production team includes Brian Allison, John Foki, Montana Johnson, Drew Jostad, Gary O'Keefe and Charlton, Thorpe, Alex Simpson is the manager of media production. And I'm Kai Rizdal. We will see you tomorrow, everybody. This is APM. Hey, David Brancaccio here. I hope you're well and that your passport is up to date because I am hosting a trip to Italy this fall and you, you are invited. Stay at a world-class Tuscan villa and step into the world of the Medici, the formidable family whose influence and power helped give rise to the Renaissance and the art we still celebrate today, and not to mention the banking system,

We're going to visit the world's oldest bank, swim in the thermal spa waters in Monte Cattini, and take in the art of the Uffizi. All of this, and then we'll try to put it all into context with great conversation over even better meals and wine tasting. Please join me and know this. Buying into this trip will provide essential support for public media. Discover more about this fall's Tuscany Adventure at Marketplace.org slash travel to reserve your spot today. That's marketplace.org slash travel.