Why Raising Rates Would Actually Calm Markets | Jim Bianco

The Fed may no longer be a one-person institution, and markets are not ready for the consequences. Jim Bianco joins David Hoffman to unpack Kevin Warsh's emerging 12-voter Fed, the end of forward guidance, and the counterintuitive case that higher short-term rates could actually pull long-term yields lower. They also explore sticky inflation, why balance sheet reduction cannot happen overnight, how AI capex is reshaping the economy, why the AI bubble may look more like 1998 than 2000, and why Bitcoin needs more strong crypto rather than deeper dependence on Wall Street and Washington.

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TIMESTAMPS

0:00 A New Fed Takes Shape
4:34 Warsh's Good Family Fight
10:16 The End of Forward Guidance
17:07 Markets Learn to Price Ambiguity
22:29 Why Rate Cuts Raised Long-Term Yields
26:42 Inflation Changes the Vote
30:42 Rates or Balance Sheet?
35:00 The Case for Higher Rates
41:07 AI Capex and the Economy
49:17 Warsh's AI Deflation Bet
53:51 The Bubble Comes Later
1:02:00 Gold, Bitcoin, and Debasement
1:07:04 Strong Crypto vs Weak Crypto

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RESOURCES

Jim Bianco
https://x.com/biancoresearch

Jim’s podcast
https://www.youtube.com/watch?v=mhq-IKbzpDs&list=PLdyJxdkS1yBU

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