Jim Bianco, president of Bianco Research, returns to The Julia La Roche Show for episode 297 for an in-studio appearance. Bianco argues the Fed is making a policy error by cutting rates when financial markets are at all-time highs across the board—stocks, gold, bonds, M2, and home prices. He explains that job creation has slowed from 158,000 to 29,000 per month not because the economy is weak, but because immigration has essentially stopped, reducing population growth to an 80-year low—meaning 29,000 jobs may actually be appropriate. Bianco warns that cutting rates in this environment risks recreating inflation through two key channels: tariffs (average rates up 6x to 17-18%) and remote work (giving labor more power to demand higher wages). He sees dangerous concentration in AI stocks (41 companies representing 47% of S&P 500 market cap) reminiscent of late-1990s bubble dynamics, with aggressive retail buying and passive flows creating mispricing that could end badly when the "buy the dip" mentality finally breaks.
This episode is sponsored by Monetary Metals. Visit monetary-metals.com/julia
Links:
BiancoResearch.com
BiancoAdvisors.com
x.com/biancoresearch
0:00 Welcome Jim Bianco - first in-person episode
0:27 Big picture macro view
1:18 Jobs market slowdown - 158K to 29K jobs/month
2:18 Immigration and population growth collapse
3:04 How many jobs should we be creating?
4:34 Is the Fed making a policy error by cutting?
6:35 Risk of recreating inflation with rate cuts
7:28 Tariffs update - average rate up 6x to 17-18%
9:00 Remote work as inflation driver
10:32 Labor power shift and wage pressure
13:00 Where will new workers come from?
15:00 What would you ask Jay Powell at FOMC?
17:05 What problem does cutting rates actually fix?
18:15 Market behavior - everything going up
19:08 The 60/40 portfolio debate
20:00 Passive bid and perpetual motion machine
21:25 Retail buying the dip aggressively
23:02 AI concentration - 41 companies = 47% of market cap
25:00 Data center overbuilding risk
25:59 Opening your statements - everything looks great
27:28 Top 10% making 50% of all income
29:21 Inflation destroys cultures and economies
30:00 Would you trade higher unemployment for lower inflation?
33:17 Inflating our way out of debt problem
34:19 Jay Powell's "do your patriotic duty" speeches in 2022
36:23 Story of interviewing for Fed Governor position
39:11 Judy Shelton coming up one vote short
41:28 Who will be next Fed Chair?
42:51 Why Kevin Hassett is the leading choice
45:30 Where to find Jim's work and the WTBN ETF
