SYLVIE DOUGLIS, BYLINE: NPR.
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STACEY VANEK SMITH, HOST:
This is THE INDICATOR FROM PLANET MONEY, I'm Stacey Vanek Smith. And you can probably hear I am outside right now. I am on Flatbush Avenue near my apartment in Brooklyn, N.Y. And there is a lot of activity. There are people walking down the street, some masked, some not masked. There are tables everywhere. Restaurants are serving food. I had to fight for the table that I am sitting at right now. There are signs all around right now that the economy is starting to come back.
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VANEK SMITH: And so this Friday for Indicators of the Week, we wanted to look at different signs of the health of the economy and what we're seeing. And joining us today are two of my favorite economists, Ben Ho and Kate Waldock. And we will talk to them about the signs they are seeing, their own Indicators for the Week, after the break.
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VANEK SMITH: Ben and Kate, welcome to Indicators of the Week. We're very excited to have you.
KATE WALDOCK: Thanks. Great to be here.
BEN HO: Yeah, thank you very much.
VANEK SMITH: So, Kate, why don't we start with you? You have brought us your Indicator of the Week, and what is it?
WALDOCK: My indicator is store closures of large retailers. And by that I don't mean retailers going bankrupt, like Brooks Brothers, I mean the number of storefronts closing across the country.
VANEK SMITH: And what are you noticing there?
WALDOCK: Well, so the most recent numbers come from Coresight, which is a research firm that specializes in retail and tech. And they report that, so far in 2021, about 3,600 retail stores have closed.
VANEK SMITH: That sounds terrible. I mean, yeah, that sounds really bad.
WALDOCK: I mean, I think that's the right reaction, right? So it sounds terrible - 3,600. But to, like, interpret these numbers, you have to compare them to what they could have been. And so what's interesting is that, in 2020, about 8,700 storefronts closed. And in 2019, it was 9,800. So it's actually more before the pandemic.
VANEK SMITH: That is really surprising about 2019.
WALDOCK: Right. So I think that this is all part of the retail apocalypse, right? This idea that there is all these forces that have been hurting retail basically for the past 10 years. There's many elements, but the big one is really Amazon and competition from online retailers. And so that's a trend that's been going on for a decade. There are very different dynamics when it comes to smaller stores. But when it comes to large retailers, we're actually at a point now - we crossed the threshold a few weeks ago when there's more openings than there are closings. And so on net, there's actually more stores, which is good.
HO: I mean, I look around just my neighborhood in the Upper West Side, and I just see a lot of optimism. Like, even during the height of the pandemic, there were, like, restaurants opening up. And that was just, like, a lot of faith that things are going to get better. And so I am sort of excited when I walk around the city.
VANEK SMITH: Well, actually, you can probably hear all this crazy traffic in the background. I am near my apartment. I live in Brooklyn, sort of near Flatbush Avenue, which is like a big, big commercial street. And so I was walking to what used to be my favorite coffee shop. And, like, I couldn't tell if it was going to reopen or not because, you know, so many businesses were kind of in a limbo. So as I was walking here up the street, in four blocks, there were 28 closed stores, like, for-lease signs and everything. So that was hard. And my coffee shop, as it turned out, is closed forever.
But I am actually sitting outside of a new coffee shop that just opened called Brooklyn Park. And it was so crowded that there are, like, people waiting for a table. There was like a woman with a stroller, like, making dead eyes at me. She's like trying to get me to leave the table because I'm not eating food. But there are way, way fewer stores. So it does seem like that kind of mixed good news-bad news thing. Ben Ho, so what is your Indicator of the Week?
HO: So my indicator of the week is $45 billion, and that is the market capitalization of Dogecoin, which you may have heard of. That's the cryptocurrency thing that people have been talking about. And to give you a sense of how big that is, 45 billion is bigger than, like, most Fortune 500 companies out there. So it's a pretty massive number.
VANEK SMITH: And market capitalization is just like how much it's worth?
HO: It's how much it's worth, right? If you owned all the Dogecoin, you'd be holding $45 billion right now, which is a ton of money for something that started as a joke, right? That's what's amazing about this. Like, seven years ago, a couple of programmers basically, you know, had a free night, and they just sort of like wrote this computer program. And suddenly, this computer program is worth so much. And the reason it's in the news right now is because, like, Elon Musk was on "Saturday Night Live" a couple of weeks ago talking about it.
VANEK SMITH: Oh, yeah.
HO: It's gotten a lot of buzz, but I think people just don't know exactly what crypto currencies are.
VANEK SMITH: Have you come to tell us? Because I would actually very much value an - what is Dogecoin, Ben?
HO: Yeah. Right now, our money is stored in places like banks or in the dollar bills in our pocket. So I think, you know, if you trust the Federal Reserve to manage the dollars in your pocket, and if you trust banks to keep track of your money, then all those things work just fine. But if you worry about those things, and you don't trust the standard monetary instruments, then Dogecoin is a way to use an algorithm to keep track of all that instead, to keep track of our money.
VANEK SMITH: But this week has not been very kind to crypto.
HO: No. There's been - I think Dogecoin itself has dropped almost like 50% in the past couple of days.
VANEK SMITH: So are you a crypto person, Ben? Are you like a...
HO: I'm not, actually. But, you know, because of Elon Musk on "Saturday Night Live," I was like, curious. You know, how hard could it be to just buy some crypto?
VANEK SMITH: You, like, saw Elon Musk on "SNL," and he was so good in the skits that you, like, decided Dogecoin seemed like a good idea?
HO: It seemed like a fun idea. I don't know if it's a good investment or not.
VANEK SMITH: So you - you're a Dogecoin owner?
HO: I am a Dogecoin owner. I own, like, .004 Dogecoin - like, yeah, a tiny amount of Dogecoin. It's worth about $70 now.
VANEK SMITH: How much was it worth when you bought it?
HO: It was 100. So I've already lost like - yeah, economists are not good investors, right? But it also sort of, like, I think plays into trust. I think everything we buy, you know, is in some ways sort of signaling to other people things about ourselves, right? Like, the clothes we buy or even like the bands we listen to. And I think in cryptocurrency, part of the appeal is that you can be part of this community, right? You could be part of Elon Musk's gang. And so I just sort of bought it to just sort of say, let's, you know, let's try this out.
VANEK SMITH: So what are you watching going forward with this? Or, like, what do you expect to see happen - I don't know - like in the next year with crypto?
HO: I don't really know, right? It's interesting because I actually happen to trust U.S. dollars quite a lot, right? I don't really see a huge need to, like, sort of reinvent our currency system.
VANEK SMITH: Well, there's, like, big inflation worries. I mean, one indicator is that my coffee somehow costs like 5.50 just for, like, a regular coffee.
HO: Yeah. Inflation worries is a good reason to look for something else, right? So, like, you know, when there's inflation, people often look to gold as a sort of more stable currency. And I sort of see cryptocurrency like a lot like gold. In some ways, it's just sort of as arbitrary as gold. Why do we use gold for value? Just because we've always used gold to store value. And it's not a crazy idea to me that people would want to use cryptocurrency to store value.
VANEK SMITH: So are you going to, like, hang on to your Dogecoin for a long time? Is it like an investment?
HO: Not really. I was actually happy to just actually sell it right now because (laughter)...
VANEK SMITH: You're going to sell it right now?
HO: I don't want to be like Elon Musk, right?
WALDOCK: I thought that was the whole point in you buying the Dogecoin is to be like Elon Musk.
HO: I just feel like ethically, you know, questionable of, like, sort of going on a podcast, like sort of talk up Dogecoin while I hold Dogecoin, right? I feel that there's something...
VANEK SMITH: Oh, OK. Oh, it's like an ethical stance.
WALDOCK: Like a pump and dump kind of thing.
VANEK SMITH: So are you going to sell it? Are you selling it right now? Is that going to happen live?
HO: Yeah. I think - let's see. This is tricky, right? Because the price keeps moving, right? So...
VANEK SMITH: Oh, yeah. Like, what are you looking at? What screen are you looking at right now?
HO: I am looking at the Robinhood website, where it says, how much do you want to sell? I said, I want to sell, you know, 78.46, which is the current value. In the last 30 seconds, the price went down. So now it's like worth 78.23.
WALDOCK: Sell, sell, sell.
HO: OK, there it is. I did a - there. Done.
VANEK SMITH: So what did you get officially?
HO: I officially got $78.10 and from my $100 investment.
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VANEK SMITH: Thank you guys so much for doing Indicators of the Week.
HO: Sure thing. Thank you.
WALDOCK: Thanks so much for having us on the show.
VANEK SMITH: This episode of THE INDICATOR was produced by Dave Blanchard with help from Gilly Moon. It was fact checked by Sam Cai. Kate Concannon is our editor. And THE INDICATOR is a production of NPR.
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