Garland Testifies, Federal Reserve Preview, UAW Strike Consumer Impact

president's son and Donald Trump? I'm Amy Martinez, that's Laila Fadl,

but also a higher bar for cutting rates as well.

U-S-W! U-S-W! U-S-W! U-S-W!

So how and when will this action impact car prices?

Stay with us, we've got the news you need to start your day.

This morning, House Republicans are preparing tough questions for Attorney General Merrick Garland.

Hunter Biden, the president's son, as well as the indictments of former president Donald Trump.

for us, and she's with us now. Good morning, Jacqueline.

What are you expecting?

oversight powers, but Attorney General Garland is going to be in the hot seat.

Garland has made several efforts to portray his office as independent of the president,

and that it makes decisions on cases with no interference from Biden or anyone else.

Still, Republicans have long criticized Garland and the DOJ,

claiming there's been unequal treatment since Trump, their de facto party leader,

has been indicted twice on 44 federal charges, and Hunter Biden was recently

indicted on three gun charges. Now, these are very different cases,

but they are behind the ramped up attacks on Garland and his agency from Republicans.

Meanwhile, Democrats say Republicans aren't really looking for facts or truth,

just a political advantage. And that's the context in which Garland testifies today.

They've spent months in the House investigating Hunter Biden in an attempt to link wrongdoing

to his father, President Biden. But so far, there's been no concrete evidence.

In an interview with the Washington Examiner this week, Judiciary Committee Chairman Jim Jordan made

it clear that a major focus for the committee this morning will be on Hunter Biden and special

counsels Jack Smith and David Weiss. Smith, of course, is the head prosecutor in the federal

Trump criminal cases. Weiss is the special counsel in charge of investigating the president's son.

Hunter Biden has been under federal investigation in Delaware for years now.

David Weiss, who Trump appointed, has investigated him since 2019. And in August,

Weiss was made special counsel by Garland. And earlier this month, Biden was indicted

on felony gun charges. But in the middle of all of this, two IRS agents came forward and accused

the DOJ of giving Biden's son preferential treatment and slow-walking the investigation

into him. Jordan has said that Weiss himself will be brought in front of the committee to answer

some of these questions sometime later this fall. And you said special counsel Jack Smith,

They've portrayed him as a victim of politics following his indictments this summer for

attempting to subvert democracy in one case and knowingly withholding classified documents in

another. And the GOP, along with Trump himself, continue to claim that Jack Smith is using these

criminal indictments against Trump as a way to attack the former president and to interfere in

on those cases regarding Trump or Hunter Biden. The agency makes a habit of not commenting on

open investigations. But he will defend the work of his agency amid all of this public scrutiny

and warn against attacks against public servants like Weiss and Smith.

balance, raising interest rates high enough to bring down inflation, but not so high as to

torpedo the economy.

interest rates steady when they meet today. But investors will be on the lookout for any

signals about where interest rates are going to be.

Good morning, Leila.

Good morning. So rates have already gone up a lot in the last year and a half and inflation

is down. Do Fed officials feel like their work is done?

but it's still north of 2%, which is the Fed's target. So the question Powell and his colleagues

are wrestling with is, are interest rates high enough now that inflation will continue to come

down on its own? Or do they need to push rates even higher and possibly raise the risk of

recession? For the moment, the Fed is expected to take a breather and leave rates where they are.

But Michael Pearce, who's with Oxford Economics, thinks they'll pair that with a message that

rates could go higher in November or December.

the optionality of additional hikes if they need to.

or just to carry a balance on your credit card. Higher mortgage rates have been a drag on the

housing market this year. But so far, the overall economy has been handling higher borrowing costs

pretty well.

That's up from 3.2% in July.

Most of the increase was the result of rising gas prices. And we've seen those oil production

cuts by Russia and Saudi Arabia push the price of crude oil up to more than $90 a barrel.

Steven Rusciuto, who's the chief U.S. economist at Mizuho Security,

says that's probably not going to sway the Fed on its own.

But if higher transportation costs start to push up other prices, that could be a different story.

but pass-through would worry.

Most of the other inflation forces the Fed's been watching, though, things like rent and

service prices are generally moving in the right direction, even if they are taking longer to come

down than most people would like.

Back in June, a lot of Fed policymakers thought they'd be able to start cutting interest rates

next year. On average, they were predicting that rates would drop maybe by a full percentage point

in 2024. We will get an updated round of Fed forecast today, and Michael Pearce thinks that

may show policymakers in more of a holding pattern.

as well. It just feels like the committee's setting themselves up for a prolonged pause

and just waiting to see where the next few months of data will take us.

and you can now add some additional fog to that picture. We've got the UAW strike,

the looming threat of a government shutdown, the resumption of student loan payments.

So there's a lot of uncertainty, and you can expect the Fed to proceed with caution.

stuck at an impasse six days into a historic strike.

but there's no indication of an imminent deal. And now the UAW is threatening to expand its strike

unless there's progress in the talk. So what does this mean if you're thinking about buying a new car?

but I also swung by the Detroit Auto Show and spoke with some people who were there,

you know, thinking about buying a new car soon. That includes Chris Deneau,

and he summed up his view on the strikes like this.

you know, gouge people for more money. They'll sell them over MSRP.

Both those men, for the record, are pretty much right.

as a car shopper here, right? The strike has other economic impacts that we're not talking

about right now. It's just a numbers game, right? Inventories, that's the vehicles that

have been built and are ready to be sold. They're at their highest level in two years.

And the number of plants that are on strike right now, it's just not huge.

The unionized automakers decades ago, they were like 90% of the car market, right?

Today, it's a different picture. They're less than 40%.

And most of their plants are still running. The union strike strategy here has been to start

small, pick a few plants to strike, and then threaten to expand from there.

So right now, in terms of vehicles that are directly affected by the strike,

you're looking at the Jeep Wrangler and Gladiator, GMC Canyon, the Chevy Colorado,

and you've got the Ford Bronco and Ranger. And that's it, right? Now, it does depend on the

vehicle, whether that's going to have an impact on supply in the near term. Right now, there are a

lot of Jeep Wranglers on lots. There are not a lot of Broncos out there. I feel like there's probably

a cowboy joke in there, if I can make it work. But in general, this is not about to cause a

to put more plants on strike this Friday. More plants could shut down because of ripple effects.

And if it lasts a really long time, we might see sales go away. Not a lot of discounts this holiday

season. This could affect used cars too, maybe. It will be slow if that happens. But car prices

her cowboy joke, maybe. Thanks so much. Thanks, Layla.

And that's Up First for Wednesday, September 20th. I'm Layla Falden.

Rafael Nam, and Olivia Hampton. It was produced by Shelby Hawkins, Ziad Butch,

and Julie Deppenbrock. We get engineering support from Stacey Abbott. And our technical

director is Zach Coleman. As always, please start your day here with us tomorrow.

hear news from the station in your community, stories from around the country, around the world,

and podcast suggestions based on what you like. Download NPR One at the App Store.