Monetary Matters with Jack Farley Why Bonds Still Suck | Aahan Menon of Prometheus Macro on Immigration’s Impact on Lower Job Numbers, Technology CapEx, Business Expansion, Manufacturing Green Shoots, and More
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Sep 11, 2025 Aahan Menon, Founder and CEO of Prometheus Macro, delves into why he believes bonds are still a poor investment compared to stocks. He highlights the impact of reduced immigration on the labor market, attributing job creation stagnation to a shrinking supply of workers. Menon also discusses the nuances in economic growth, emphasizing the shift towards technology and intellectual property investment. Additionally, he explores the fragility of the current equity valuations amid labor market issues and touches on the prospects for recovery in sectors like manufacturing.
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Tech And IP Drive Today's Expansion
- The current U.S. business cycle is an expansion driven more by tech/IP investment and stable consumer spending than by manufacturing.
- This concentrated growth produces strong aggregate metrics despite uneven sectoral performance.
Labor Weakness From Falling Immigration
- Recent labour weakness stems mostly from a drop in immigration flow, a supply shock not the usual demand-driven unemployment spike.
- That produces a lower employment-growth trend rather than a classic recessionary unemployment-driven collapse.
Decomposing Employment Shows Foreign Role
- Employment growth decomposes mechanically into population, participation, and unemployment-rate effects, and foreign flows drove recent gains.
- Population benchmark revisions hide true trends and make household and establishment surveys look inconsistent.