Macro Voices MacroVoices #496 Jim Bianco: The Post Covid Economy
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Sep 4, 2025 
Jim Bianco, founder of Bianco Research and a macroeconomic expert, shares intriguing insights on the post-COVID economy. He debates the implications of potential Fed rate cuts amid rising inflation and explores the unexpected ties between job reports and immigration. Bianco also warns that lowering short-term rates could shock long-term yields. The conversation covers bond trading strategies for both institutions and retail investors, highlighting the evolving dynamics of financial markets in today's landscape.
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We Are In A Post‑COVID Economy
- Jim Bianco calls the COVID shutdown/restart the biggest economic event of our lifetime and labels the current era a "post-COVID economy."
- He warns the pre-2020 playbook no longer applies and a new macro framework is being written.
Rate Cuts Can Raise Long‑Term Yields
- Cutting short-term rates can lift long-term yields when markets fear cuts will rekindle inflation.
- Long-term yields rose after recent central-bank cuts because investors priced higher future inflation risk.
Neutral Rate Likely Higher Now
- Bianco expects a new neutral rate reflecting a higher inflation regime, around 3–4% rather than sub‑2%.
- He argues cutting too far would be overly stimulative and revive inflation expectations.