Planet Money - A trucker hat mystery, the curse of September and other listener questions

Episode Date: September 29, 2023

Ba-dee-yah! Say do you remember? Ba-dee-yah! Questions in September!That's right - it's time for Listener Questions!Every so often, we like to hear from listeners about what's on their minds, and we try to get to the bottom of their economic mysteries. On today's show, we have questions like:Why is September historically the worst month for the stock market?How did the Bass Pro Shops hat get so popular in Ecuador?Are casinos banks?What is the Federal Reserve's new plan to make bank transfers faster?Today's show was hosted by Sarah Gonzalez and produced by James Sneed. The audio engineer for this episode was Josephine Nyounai. It was fact checked by Sierra Juarez and edited by Dave Blanchard. Alex Goldmark is our executive producer.Help support Planet Money and get bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

This is Planet Money from NPR. So hi, nice to meet you. Hi, good to meet you as well. I'm Sarah, by the way. I know, I think I've listened to every single episode, I believe. This is Planet Money listener Justin Yeager. I'm not saying I'm a super fan, but yeah, anyway. You gotta love his honesty.

And the other day, Justin emailed us because he had been noticing this thing that he thought was kind of strange. He's a professor at a college in Quito, Ecuador. And in the very first kind of classes, I noticed a lot of Bass Pro hats. Bass Pro Shop hats. Yeah, you might have seen these hats. It's like a kind of trucker style hat. With a fish. With a kind of ugly fish on it.

Bass Pro Shops, yeah. Bass Pro Shops are big hunting, fishing, camo kind of stores in the U.S. And Justin is from the U.S. He lived in the South for years and saw Bass Pro Shops all the time. Yeah. And the reason Justin is confused by the popularity of this hat in Quito, Ecuador, where all his students are, is because there is not a single Bass Pro Shop store in Quito. Actually, there isn't a single Bass Pro Shop store anywhere in Ecuador or even anywhere in the entire continent of South America. So Justin is like, how did all of my students get their hands on this hat? It's not a particular, you know, group. It's really kind of randomly across the board. So it's not like a cool kid thing. It's like everyone. It's an everyone thing.

I mean, you know, I don't try to rank my students by cool or not. I don't know. You do. I mean, come on. Is it the jocks or is it the nerds? You know who the nerds are. I mean, come on. Is it the jocks or is it the nerds? You know who the nerds are. I mean, like recognizes like, I guess. Justin says his students don't even know that Bass Pro Shops are even like shops. They're like, no, I just like the logo or just, you know, whatever. And I'm like, oh, well, this is hunting, fishing store with, you know, big stuffed animals of like, you know, dead animals.

And they're like, oh, weird. I'm like, no, but like, that's what you're repping. Like, you know, it's stuffed animals. Well, you know, this is like taxidermy. So my question is, how does the brand get widespread recognition and popularity in a place where it doesn't exist and with people who don't really know what the brand is. All right. We're going to try to find an answer. I have no one that I trust more than you guys and no one else wants to answer this question more than me. Hello and welcome to Planet Money. I'm Sarah Gonzalez. And I'm Samuel Ahors-Kessler. Today on the show, we are going to try to figure out how so many people in Ecuador got their hands on this hat that is sold only in stores in North America.

And we're going to answer a few other listener questions like, could you maybe be getting your paychecks sooner? Are casinos secretly actually banks? And what causes the curse of September? and what causes the curse of September. All right, we are poking around on the Bass Pro Shop hat situation, but in the meantime, we're going to get to a bunch of other listener questions. And first up, we have Jeff Gwill. Hey, Jeff. Hey, Sarah.

Happy September. Okay. Happy September, Jeff. Are you a September fan? I love September. Crunchy leaves, cute little jackets. You're right. Love it. You know who does not like September?

Wall Street. You are talking about the September effect. Well, I like to call it the Curse of September. That's much better branding. Yes. That is what our listener, Bailey English, wrote to us about. And we should explain what the Curse of September is. Yes. That is what our listener, Bailey English, wrote to us about. And we should explain what the curse of September is. Yes.

So this refers to a weird phenomenon where the stock market tends to go down in the month of September. Like, if you look at the past hundred years, September is on average the worst month for stocks. So our listener, Bailey, wanted to know what is going on with this September slump in the stock market. Why does it happen? So I called up Lily Fong. She is a professor of finance at INSEAD. It's this fancy European business school. And Lily wrote an entire paper about this September thing a few years ago.

Okay. Can I just ask you, do you remember? Remember what? The 21st night of September. Oh, okay. Maria, dancing in September. You know what I'm talking about? Oh, yes, yes. I didn't link it to the research, but yes, I know that song. So Lily actually does remember how she first heard about the curse of September.

She saw it in the Wall Street Journal, actually. Yes, the Wall Street Journal, almost every September, they have one of these articles. So Lily started poking around. And as someone who studies what makes the stock market move up or down, Lily knows that the main thing that moves stock prices is information. The major moves always happens when there's big announcements, you know, earnings days, or there's merger acquisition. And the bigger the surprise, the bigger the move. And surprise is what we call news. News. News is what causes more people to want to buy a stock or more people to

want to sell a stock. And Lily says the stock market actually reacts a lot faster to good news. Like when a company releases good news, like we just invented a flying car, anybody can go out and just buy that company's stock, which causes the stock price to go up right away. But when there is bad news, like, oh, no, our brand new flying car just blew up. Only people who own that stock can sell it, right? You can also react to bad news by short selling, but most people can't do that. So bad news, you have just a smaller market for that information to get absorbed. And that's why, generally speaking, negative news travels more slowly. And knowing this fact about the stock market, that good news travels fast, bad news travels more slowly. And knowing this fact about the stock market,

that good news travels fast, bad news travels slow, Lily had a theory about what was causing this September effect. Because at the time, she was teaching in America, and she noticed something. We all know Wall Street people, right? They go to the Hamptons. They are wherever. They are away in the summer. And so therefore, you get even less attention. So the ability to take advantage of negative news is even less. Of course, vacation is part of the answer. Vacation is always the answer. You're right.

Lily says, think of it this way. September is like this long hangover period where all the bad news that happened over the summer that maybe people weren't really paying that much attention to, all of that bad news is slowly getting priced in in September. And that's what causes all the stocks to go down. And this isn't just like a theory she has, like she has data to back this up. Right, exactly. She looked into, for instance, company press releases, and she was able to show that over the summer, there's this big slowdown in how quickly the market reacts to bad news. But the thing that really convinced me is Lily also looked at other stock markets like around the world.

In China, Singapore, and Hong Kong, the major holiday when people are taking time off, it's actually Chinese New Year. And in those places, stocks tend to go down right after Chinese New Year. Sounds like maybe September effect, that's too American-centric, right? This is really like a holiday effect? Yes, indeed. I think September effect is probably part of a broader phenomenon. This is global. Right. Yes. Yes.

But Lily says that this holiday effect, this curse of September, whatever you want to call it, it also seems to be fading away in the age of, you know, cell phones and the Internet. Because you can get Wi-Fi out in the Hamptons and probably people are looking at their phones on vacation, their work emails. Yeah. Unfortunately, yes. And also these days you have all these algorithms and computers that are making trades and they never sleep. They never take a vacation.

So Lily says this September curse, maybe its days are numbered. All right. Bye to you, Jeff. Bye to you too, right. Bye to you, Jeff. Bye to you too, Sarah. Next up, we have got producer Emma Peasley. Hey, Emma. Hi, Sarah. So I have another listener question. This one is from listener Daniel Martin, and it's about this instant payment system that the Federal Reserve recently rolled out. It's called FedNow. And Daniel's about this instant payment system that the Federal Reserve recently rolled out. It's called FedNow.

And Daniel's question, well, he actually already seems to know a lot about FedNow. Yeah, it was a long email, Daniel. Yeah, but basically, here's the situation. The way money moves from one bank to another in the U.S. is incredibly outdated. It's really slow. We're talking about like when your employer moves money from their bank account to your bank account, you know, to pay you. It can take a couple of days between when your employer sends the money and you can actually use the money.

Same thing when you try to send money to a loved one or pay a bill, whatever. There are processing delays that could take days. And in a lot of countries, it is not like that. Moving money, paying bills are instant. Right. And there are some private apps like Venmo or PayPal that sort of feel like they're instant, but they're actually not. Because, yeah, you might see the money in your Venmo account, but it actually hasn't been transferred to your bank account. And that is not instant. It takes a couple of days unless you pay a fee. And of course, those are private companies that stepped in to fill a need because the official system we have takes so long. The Federal Reserve

has used a decades-old system called an automated clearinghouse, or ACH, which operates like a laundry machine on a batch. This is Aaron Klein at the Brookings Institution. Put all the payments in at once. You press the button, you wait a while and all the payments get sorted and come out together. This is a great way to describe the system. Yeah, I think it's kind of his go-to description. He talks about instant payments a lot, Yeah, I think it's kind of his go-to description. He talks about instant payments a lot, but we love a metaphor. And Aaron, he's actually kind of obsessed with helping people get their money faster. He helped create the law that allows us to deposit checks on our phones. Wow. Hero. Thank you, Aaron.

Yes, love that. And he says one of the big issues with this laundry machine batch system comes down to overdrafts. Right. So sometimes your checking account is at zero dollars. So technically you have money, you're just like waiting for your check to clear the lag at the bank. So you overdraw your account, you take out money that you don't actually have access to yet. And of course, a lot of banks charge you for this. access to yet. And of course, a lot of banks charge you for this. Yeah, a typical overdraft fee is like $35 per transaction, which mainly affects low-income people. We have a slow payment system that operates on the assumption that you always have $1,000 or more in your bank, and it doesn't matter to you if your deposit's available on Friday or the following Tuesday.

matter to you if your deposit's available on Friday or the following Tuesday. Aaron estimates that 30 to 60 percent of overdraft fees could be eliminated with a real-time system. And this is what the Federal Reserve rolled out in July, FedNow. And this is what our listener emailed about. FedNow, the new Federal Reserve system for transferring money between banks, does finally make bank transfers truly instant. So instead of the old system where you just kind of piled up the payments and ran it a couple times a day, the new one goes constantly 24-7, 365. Right. So instead of waiting for every single person's laundry to be done, it would be like your

laundry done instantly whenever you need it. Yeah, like actually it will take seconds to pay a bill or get your paycheck. Like once NPR says, okay, yes, pay Emma Peasley now, seconds later, Emma will be able to use the money, not days later. Yes, but there is a pretty big catch. Could I send you money with this new system? No. No consumer has the ability to access FedNow. No bank is required to offer it to their consumer.

Even if your bank has signed up for FedNow, of which only a handful of the banks have, you can't go in and ask them to use it. It's their choice. Fewer than 100 banks and credit unions have signed up to use FedNow, according to the Federal Reserve, out of about 9,000 in the country. And this is kind of the big question that Daniel's email got us wondering. Like, why? Why haven't banks started offering this more if it finally exists?

Yeah. So Aaron says the big reason is that banks don't really have an incentive to use it. Those overdraft fees they get from people waiting for their checks to clear, that's not a problem for banks. It's a benefit. That's literally money in the bank for them. And so he says the current system of banks just volunteering to sign up for Fed now, it's probably not going to work. If the Federal Reserve wants this to happen, he says they need to make it happen. I have a glimmer of hope that now that the Fed has built a real-time payment system, it will mandate real-time payment systems. It has the regulatory authority but has sat on its hands for decades.

So sometime in the future, you might get your paycheck a couple of days earlier. Something to look forward to. Thanks, Emma. Thanks, Sarah. All right. After the break, we are talking about the heyday of walking into a casino with a suitcase full of cash. No questions asked about where the money came from. And we get to the bottom of the Bass Pro Shop mystery. All right, Keith Romer, you have been answering a question for one of our listeners. Hi, Keith.

Hi, Sarah. Yeah, so a little while back, our sibling Daily Podcast, The Indicator, they did an episode where they looked into whether various bank-like things were, in fact, banks. Right. Companies like PayPal and even Starbucks, they're holding all of this money for you and maybe doing fun stuff with it, like how banks do. Exactly. So listener Elena Washabaugh, she wrote in to ask, what about casinos? Are they banks? And Keith, you are kind of like our senior gambling slash casino correspondent for NPR, right? I am trying to get that recognized by NPR, but so far, officially, no. Unofficially, yes. Okay. Okay. Okay. So to get an answer for Elena, No, unofficially, yes.

Okay, okay. Okay, so to get an answer for Elena, I reached out to Stephen Crystal. He used to be a part owner and operator of six casinos in like the downtown old school part of Las Vegas. What we tried to do is bring a little bit of the old Vegas charm in terms of how we dealt with customers. These days, Stephen runs a gaming consulting business called SCCG Management. And he says you can store money on account at the casino. So if you're like a high roller who flies out once a month, you don't have to physically bring $100,000 in cash with you on the plane every time. So for money storage, casinos are kind of bank-like. And the rules that casinos have to follow in dealing with all that money,

also pretty banky. Look, in the old days, back in the 50s, 40s, when Vegas started, you could come with a suitcase of cash and no one would ask you or want to know where that cash came from. But today, Steve says, there are some more bank-like regulations that apply to your suitcases full of cash. I would say the number one focus for regulators is what we call AML, anti-money laundering, and KYC, which is know your customer. And so these are the same types of concerns that we see with banking institutions. that we see with banking institutions. So what this means, Sarah, is that if you walked into a casino and tried to buy anything more than $10,000 in chips, the casino has to get your name, your social security number, your occupation, and file a report to the government.

Wow, very official. Right. Same thing if you try to cash out any more than $10,000. And this is the exact same process that happens when you go to a bank and try to deposit or withdraw that much money. Okay. So in terms of storing money, making sure that money is clean, yeah, pretty bank-like. Yes, but that is sort of where the comparison ends. Can I have a casino checking account? You cannot. Can I get a mortgage at a casino?

You cannot. Can I get a small business loan from a casino? You cannot. So the big difference between banks and casinos is how they are making their money, right? Banks make their money taking in money from depositors, turning around, loaning that money out, and charging interest to people who want to borrow it.

But that is actually way riskier than what casinos are doing. We are not a risk-taking enterprise. Casinos have mathematical advantages in games. The rules favor the house. And if we run the business the right way, we will make the profit designated. Though, little addendum, interestingly, Steve says the big casinos on the Las Vegas Strip, not only are they not banks, more and more they are also shifting away from relying so

much on gambling to make their money. So now it's hotel rooms, resort fees, Cirque du Soleil shows, nightclubs, dayclubs, bottle service, all of that. Casino games have a set margin. They're mathematical. But you can make a Coca-Cola $10, and if someone's on the strip, they're going to pay $10. Okay? So big Las Vegas casinos, not banks, but not casinos either. They are more really like fancy resorts with some slot machines.

Wow. Okay. Thanks, Keith. Hey, what was your game? Oh, poker. Poker. Poker. Okay.

Were you good? Did you have like a gambler nickname? Well, I will tell you, and this relates to this show, in the illegal clubs in Manhattan that I used to play, I was known as Bass Pro because of the hat I wore. No. Wait, because of the hat you wore? Keith Bromer.

Perfect transition to our next and final segment with Sam Yellow Horse Kessler. Hey, Sam. Hi, Sarah. Yeah, that's pretty unbelievable. Crazy coincidence. Okay, so we heard from a listener in Quito, Ecuador, who said he sees his college students in these Bass Pro Shop hats all the time. At least one or two students every day, and he cannot understand why. Yeah, and forgive me for saying this, but something about this trend seems a little Bass-ackwards.

Yeah, because I'm going to just say it. This is not a cute hat. Yeah, we didn't exactly get the appeal. So we needed somebody who, let's be honest, knows a little bit more about fashion than Sarah and I. We called up a legitimate brand and fashion expert. I'm Karla Martinez-Salas. I'm the head of content for Vogue Mexico and Latin America.

Vogue, baby. And Karla says this Bass Pro Shop hat thing is a little bit of a head scratcher. To be honest, when you guys texted me, I was like, okay, I'm going to do some investigation. It is a mystery in the same way. You know what it reminds me of? About the Von Dutch trend. Remember that one, like in the early kind of aughts where like Paris and Justin Timberlake were wearing all these hats. And also they became popular in Latin America, too. All right. Kind of surprisingly, major newspapers, the Wall Street Journal, Business Insider, the Santa Fe New Mexican,

have all written articles about the popularity of this Bass Pro Shop hat in the U.S. Apparently also there was a comedian, Curtis Conner, that started wearing them first. Curtis is a comedian in Canada. And it was kind of like a joke. And then people caught on to it. You know, I do feel like those like silly things happen. Those like gimmicks. And then all of a sudden they get on TikTok and it's like, boom.

Okay, so I'm seeing these hats all over TikTok. The Bass Pro Shop hat. Clean. Timeless. These hats all over TikTok. The Bass Pro Shop hat. Clean. Timeless.

Man, as a fisherman, seeing everybody wearing the fishing drip is very interesting. The fishing drip. So, okay, this is a little bit of the answer, but it doesn't quite tell us how the trend got to Quito, Ecuador in particular. But Carla thinks she might know someone else who can help us out here. I'm going to connect you with this guy. Okay. My name is Jose Antonio Hernandez. I'm going to connect you with this guy. Okay. My name is Jose Antonio Hernandez. I'm from Ecuador. I like to write about like fashion, pop culture,

mostly for VogueMexico.com. Perfect. It sounds like you're the perfect person to help us answer this question. Yeah. Jose says he remembers exactly how these hats started getting popular in Ecuador a few years ago. Pretty funny because actually in Ecuador, there is a bunch of exchange students that come from North America to Ecuador, specifically in Quito. That's where our guy is. Yeah. That's where our listener who had this question is. He's in Quito. Yeah, totally, totally.

Yeah. Jose says exchange students in Quito were wearing these hats that were already big in the U.S. and then locals in Quito started getting into them. But Jose says the trend has totally evolved from that and become extremely popular among Latinos in particular right now for a different reason, because of a new fashion trend. So the fashion or the trend is called veliko. So veliko is basically where all the gen z's start to wear things around like the narco culture. You said it's a nod to narco culture? Yeah. So it's like your hat, a white tank top, and like a huge necklace,

like embellished necklace, like, and some sunglasses. Yeah. And Jose says there's a very popular song right now also that specifically references the Bass Pro Shop hat. The song is called Teco M by a band called Fuerza Regida. It says like, I'm la gorra de pescadito. So basically, I'm the hat. Pescadito, like that hat, the one with the little fish on it. Yeah.

So also like, I think that phrase was like the boom around all Latin America. Okay, so it feels like we have an answer to why this is so popular in Ecuador right now. But we still don't know how they're getting there. Because again, there are no Bass Pro Shop stores anywhere on the continent of South America. We did do a little test and you can technically ship a hat to yourself in Quito, but the shipping cost alone is like more than six times the cost of the hat, which is $6. So I can't imagine that

that is the main way people are buying these hats. We, of course, reached out to Bass Pro Shops itself to see if they ship anything to Ecuador, but they never got back to us, despite us being so cool and friendly. Yes, but lucky for us, there is publicly available export data. And I mean, of course, we looked into it. Since 2009, we learned that there have been about 38 shipments from Bass Pro Shops to South and Central America and also parts of the Caribbean. But none of the shipments have been, quote, hats of any kind. No hats. Totally bizarre. It's apparently just been like fishing gear and mosquito repellent and like stuff like that. This is according to S&P Global Market Intelligence, which tracks exports. But Jose, our Ecuadorian and fashion expert, was kind of like, you guys are looking in the wrong place.

You got to look at the informal hat supply chain and the students in Quito who are wearing these hats. We're speaking about like the two best universities in Ecuador that they have like a really high, they have money, like they can go to the United States and they tend to go to Las Vegas because I know that there is like a big store of this and they go there. They specifically go and they shop there. Yeah, of course. People come to the U.S. and buy these hats. And tíos and tías in the U.S., they bring these hats with them when they visit or they mail them to their nieces and nephews in Ecuador. But also, José says, a lot of the Bass Pro hats in Quito, they are not authentic. But there's also like a bunch of knockoffs. Yeah, knockoffs. Seamstresses will sew fake Bass Pro Shop logos on a hat for you. And if you go on Instagram and TikTok, there are so many accounts dedicated to just selling probably fake Bass Pro Shop hats. So there you have it. Social media kicked off the trend. Foreign exchange students amplified it in Quito.

It blew up in Latino music and fashion. And the Gen Zers took to it like a bass to water. Sam. All right, Sam. Thank you so much. No problem. And thank you to our listeners for all of your questions. We read them all.

Even if we didn't get to them in this episode, they stay with us. They might pop up in different ways in different shows. So keep them coming. Next week is NPR's Climate Week. We are spending seven days focusing on people working to build a better world for the next generation and the one after that. Next Friday on Planet Money, we'll share the story of one man's quest to power the entire country of Uruguay using renewable energy. For more stories like this, head to npr.org slash climate week. Today's show was produced by James Sneed.

The audio engineer for this episode was Josephine Neone. It was fact-checked by Sierra Juarez and edited by Dave Blanchard. Alex Goldmark is our executive producer. I'm Sarah Gonzalez. This is NPR. Thanks for listening. And a special thanks to our funder, the Alfred P. Sloan Foundation, for helping to support this podcast.