MARY REICHARD, HOST: Today is Monday, September 3rd. Thank you for turning to WORLD Radio to help start your day. Good morning. I’m Mary Reichard.
NICK EICHER, HOST: And I’m Nick Eicher. Coming next on The World and Everything in It, the Monday Moneybeat.
Negotiators for the United States and Canada are getting back together the day after tomorrow to try to agree on a new North American Free Trade Agreement. You’d probably know it better by its acronym, NAFTA.
The free-trade pact has been in place for 24 years. But President Trump wants it renegotiated. He says it’s unfair to American companies. Last week, he came to terms with the third NAFTA partner, Mexico.
The president notified Congress he plans to sign the deal December 1st, with Canada or without. The exact terms of the new NAFTA don’t have to be released until the end of this month, so there’s still time to work out remaining differences so Canada can sign on.
That country’s minister for trade met with the U.S. trade representative for four days of talks last week. All they could agree on was they’d meet again on Wednesday.
Two known sticking points involve the openness of Canada’s dairy market, and how long the American makers of biologic drugs get to sell without facing competition from generic versions of those medicines.
REICHARD: The American economy grew in the second quarter of this year even more than first reported. Gross Domestic Product for the months of April, May, and June grew at a 4.2 percent annual rate, up one tenth from the initial report. Combine that news with the July consumer-spending report, and economists now predict overall GDP growth for the full year will most likely hit 3 percent.
And if so, it’d be the best economy since 2005, two years before the great recession hit.
EICHER: Whenever the economy’s growing like this, one negative side effect can be inflation. When the Federal Reserve detects an inflation rate in excess of two percent, it responds by raising interest rates. The inflation indicator the central bank monitors hit 2.3 percent for the 12 months ending July. That’s the steepest year-over-year rise since 2012, and it suggests the Fed will nudge interest rates up this month and probably once more before this year ends.
REICHARD: Despite a down day on Friday for stocks, the full Wall Street week was yet another winner, as the record-setting bull market set another high mark for longevity.
All the major indexes finished up: The Dow Jones Industrials up seven-tenths of a percent, the Standard and Poor’s 500 gained nine-tenths, the Russell 2000 also nine-tenths, and the NASDAQ picked up 2.1 percent.
EICHER: Marijuana is legal in Oregon. It is illegal under federal law. So you can imagine the tension. Authorities in Oregon on Saturday put in place a new rule aimed at placating the feds. They’re requiring pot growers to notify the state when they plan to harvest. What that means is those growers can expect an unannounced inspection to ensure none of the weed is diverted for export across state lines.
Growers are groaning, because oversupply has driven down the market price, and further regulations are threatening their already thin profit margins.
And that’s this week’s Monday Moneybeat.