Economics in the News – April 20-26, 2026
Economics impacts our lives every day. Below are some of the top storylines from this past week related to economics.
o Skyrocketing costs in health care, housing, and education are causing many young couples to postpone having children. The birthrate has slumped to a record low, and economists warn that if these trends continue, the consequences could be severe.
The cost of having a child is often the second-highest household expense, behind rent or a mortgage. In the United States, the average annual cost of raising a child was $13,000 in 2024, 30 percent higher than in 2020. Many couples are struggling with the cost of childcare, which has increased faster than overall prices, while surging home prices have deterred them from buying their first home and paying higher prices at the grocery store. [The New York Times]
o Airlines are feeling the strain of higher jet fuel prices, and consumers will likely see the impact during the summer travel season. The impacts are most felt thus far in Europe, where airlines such as Lufthansa have announced the cancellation of routes. Many airlines are finding ways to pass the burden to travelers with additional baggage fees and fuel charges.
Prices for jet fuel have increased by 70 percent globally since the start of the US war with Iran. With jet fuel being one of airlines’ largest expenses, more carriers – especially smaller ones – are facing financial hardship. While the US has significant oil reserves and refining infrastructure, airports and airlines in Europe and Asia rely on oil from the Middle East. [The New York Times]
o Many consumers purchased new cars during the COVID-19 pandemic. Several years later, more Americans are trading in their cars when they are worth less than what they still owe or have negative equity. Slightly less than one-third of the vehicles traded during the first quarter of the year had negative equity, according to Edmunds.
The average balance on those loans was $7,200, the highest it has ever been, due to high prices and high interest rates. In addition, 70-month car loans have slowed the paying down of car loans. Buyers purchasing new cars in 2026 with negative equity financed their vehicles with an average car loan balance of $56,000, $12,000 higher than a buyer without negative equity. Defaults and repossessions are at the highest level since 2010. [The Wall Street Journal]
o Stock prices have soared in the United States in the second half of April despite the US conflict with Iran. However, underlying issues suggest that the recent rally could be short-lived. Analysts are warning that investors are ignoring red flag signals that could be problematic in the second half of the year.
In addition to surging fuel prices, fertilizer prices have soared in recent weeks. That could lead to a shortage of key ingredients and higher food prices. In addition, due to energy shortages, factories in countries that US manufacturers commonly rely on, such as Vietnam and Bangladesh, may be forced to shut down operations. [The Washington Post]
o Shareholders have approved the Warner Bros. Discovery merger with Paramount Skydance. Assuming federal and international regulators approve the $110 billion deal, the merger would create a media giant that David Ellison, the son of legendary Larry Ellison. promised would put out 30 movies a year.
In Hollywood, actors, writers, and directors adamantly opposed the merger, signing an open letter believing that it would lead to fewer choices and higher prices for consumers. If approved, the aim is to finalize the merger by September 30. [NPR]
