The Fed Got It Wrong—and the Bond Market Knows It
Bianco Research
62,706 views
Jim Bianco explains that bond yields have climbed above 5% because sticky ~3% inflation and persistent nominal growth reflect a new economic reality rather than a crisis. He views these yields as offering real value, leading him to turn bullish and buy US Treasuries for the first time in six years. Addressing broader market concerns, Bianco downplays the risk of an immediate AI financial crash, emphasizing instead that cybersecurity vulnerabilities and the risk of falling behind China in the AI race pose the more critical challenges.
Chapters
00:00 - Bond Yield Surge & Why Jim Is Turning Bullish
00:31 - What Drives Fair Value: Nominal Growth & Inflation
01:11 - Will Rising Yields Break Something in the Economy?
01:54 - Yield Targets & Buying Treasuries Above 5%
03:02 - The 6% to 8% Scenarios: Systemic Risks & LDI Flashbacks
04:44 - Drivers of Sticky Inflation: Deglobalization, CapEx & Energy
06:03 - The Death of the 2% Inflation Target
06:53 - Why the Fed’s Cutting Cycle Backfired on Long Rates
07:48 - The Bond Market Vigilantes vs. The Fed
08:34 - The AI Boom: Financial Bubble vs. Real Safety Risks
10:16 - The US–China AI Race & Corporate AI Adoption
11:24 - What the Market Is Missing
20 Comments
Treasury Secretary Bessent needs help taking control of the bond market.
Treasury Counselor Shelton is the architect of gold bonds. She developed the playbook for using a gold revaluation alongside gold bonds to reduce the burden of U.S. debt while keeping interest rates low and inflation contained.
In the back of everyone’s mind, they know who is influencing bad decisions.
Ai is eventually very deflationary
The Fed Got It Wrong—and the Bond Market Knows It
Bianco Research
62,706 views
Jim Bianco explains that bond yields have climbed above 5% because sticky ~3% inflation and persistent nominal growth reflect a new economic reality rather than a crisis. He views these yields as offering real value, leading him to turn bullish and buy US Treasuries for the first time in six years. Addressing broader market concerns, Bianco downplays the risk of an immediate AI financial crash, emphasizing instead that cybersecurity vulnerabilities and the risk of falling behind China in the AI race pose the more critical challenges.
Chapters
00:00 - Bond Yield Surge & Why Jim Is Turning Bullish
00:31 - What Drives Fair Value: Nominal Growth & Inflation
01:11 - Will Rising Yields Break Something in the Economy?
01:54 - Yield Targets & Buying Treasuries Above 5%
03:02 - The 6% to 8% Scenarios: Systemic Risks & LDI Flashbacks
04:44 - Drivers of Sticky Inflation: Deglobalization, CapEx & Energy
06:03 - The Death of the 2% Inflation Target
06:53 - Why the Fed’s Cutting Cycle Backfired on Long Rates
07:48 - The Bond Market Vigilantes vs. The Fed
08:34 - The AI Boom: Financial Bubble vs. Real Safety Risks
10:16 - The US–China AI Race & Corporate AI Adoption
11:24 - What the Market Is Missing