Live with Jim Bianco – How the Fed Affects Equities

Published on
November 14th, 2019
Duration
56 minutes

Live with Jim Bianco – How the Fed Affects Equities

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Published on: November 14th, 2019 • Duration: 56 minutes

Jim Bianco Research is the President and Macro Strategist of Bianco Research LLC. His research focuses on monetary policy, macroeconomic trends, and he advises his clients on asset allocation and strategic positioning in financial markets. Jim is a regular contributor to CNBC, Bloomberg, and Fox Business, and is often quoted in the Wall Street Journal and Grant’s Interest Rate Observer.

Comments

Transcript

  • TZ
    Tibor Z.
    18 December 2019 @ 06:29
    Get some serious audiophile microphones or get into a studio. Audio quality is not enjoyable.
  • XF
    Xavier F.
    10 December 2019 @ 02:54
    great I hope you can do this again soon
  • RK
    Robert K.
    9 December 2019 @ 09:39
    Content fantastic. Audio quality ridiculous :)
  • AW
    Andrew W.
    5 December 2019 @ 01:50
    "the next reserve currency after the dollar is going to be crypto, which currently does not exist" --> yes it does, it's called BTC.
    • RA
      Robert A.
      5 December 2019 @ 03:40
      I’m sure Jim is familiar with BC and as a BC owner I would be really curious as to why he doesn’t think BC would work.
    • CP
      Carl P.
      8 December 2019 @ 21:12
      I thought it was XRP? or NRG? lol jk A. Antonopoulos' latest talk was on how many chains acting as one network seems to be the future of Bitcoin and crypto. An interoperable network of chains like than could eventually act as a global digital currency. Possibly.
  • CB
    Cliff B.
    8 December 2019 @ 11:33
    Audio better
  • DP
    David P.
    7 December 2019 @ 04:47
    As a short follow up, there is a guy on Twitter (PlungeProtectionTeam @gameblazer06) who is a could follow on Repo and other GSIB regulatory minutiae...Have no idea who he is, but seems to have a serious grasp on repo and related regulatory topics and how and why the Fed entered (became) the market...I just get the feeling that because realized volatility been so low and everything is up and to the right, that the topic of failed repo market isn't getting as much attention as it should (you guys call it out often)...
  • DP
    David P.
    7 December 2019 @ 04:40
    Very good interview and important topics. One of my favorite interviewers and Jim is a great guest. I think a deep dive, in-person interview with Jim or another guest (sooner rather than later) on the detailed transmission mechanism between Repo and new POMO (the "not QE" of $60B) and the relentless bid in equities is really needed and would be excellent. I'll take off my tin foil hat (i.e., the Fed is buying equities directly, futures, or selling naked VIX futures) and state that unequivocally the character of the equity market changed dramatically when Repo and "not" QE started. Specifically if banks take overnight or term repo I assume it's held in excessive reserves. How do banks influence equity prices when that transaction takes place? Why not just hold at IOER rates? Also, it's clear that there is nothing more permanent than a temporary Fed action so I do think they are and will be the Repo market for the foreseeable future...As someone with the typical CFA / MBA / corp finance background (all of which completely irrelevant for the last decade) but charged with earning some return for clients, I've gotten quite good at navigating the environment with daily S&P call spreads...Just tough to stomach that literally is the world we will be in forever....
  • DP
    Dimple P.
    6 December 2019 @ 21:15
    Great guest lineup so far but you guys really have to resolve the audio echo problem. Still miss the Think Tank platform. Really enjoyed the diverse written research that was presented in TT. I think this access feature could have just been added to the TT platform. Please resolve the audio issues. Thank you for the A-list guests.
  • AP
    Adam P.
    6 December 2019 @ 20:36
    I got much more out of this conversation once I read back the transcript. Lots of content. Dense conversation. Great stuff, really. w/r/t follow-up questions (page 12 of the transcript): Jim says the "breakdown argument" would make him run away from the bond market. I'm not sure I follow. Can we expand on that?
  • GD
    Ghassen D.
    5 December 2019 @ 16:19
    This interview was great with a lot of added value, BUT it could perfectly have been broadcasted in RVTV. Why would anyone pay the Access service + RVTV ?? I was a fan of TT, It provided readable reports and especially tradeable ideas (short and long term) that could really make you money, which is the aim of a premium subscription. Another comment, it feels like the service is so focused on (1) Macro (2) the next few months (3) Fed and central banks & Financial Engineering and doesn't treat (1) longer term horizons and bigger trends (2) Micro & INVESTING in Businesses in the real economy , which is very well covered in RVTV even though not in a structured framework because each guest brings his views. I do not know where this is going but I suggest that you guys focus on making us ROI via debatable, tradeable investment IDEAS (maybe each guest brings his best tradable idea for the next 12 months and another one for the next 5 years and we debate on that ??) I would happily pay more for the service if it provides practical ideas but in the current form I would ask for TT money back
    • KT
      Kenneth T.
      6 December 2019 @ 16:15
      I completely agree. I would pay more for Think Tank the way it used to be. These interviews are not really worth much at all.
  • DF
    Diamantino F.
    5 December 2019 @ 18:13
    Honestly, I still don't understand the concept, Think Tank had macro but also hands-on trade ideas and suggestions, not sure where this differs from RVTV, or is this a loss to RVTV????? I'm lost ...
  • MR
    Mitchell R.
    5 December 2019 @ 16:37
    Great content marred by technical difficulties...
  • JL
    J L.
    5 December 2019 @ 14:41
    Norway or the Netherlands (EZ) or one of those N countries?
  • YO
    Yoshitaka O.
    5 December 2019 @ 12:22
    Captions / subtitles please! Particularly given the horrible quality
  • TO
    Toby O.
    4 December 2019 @ 22:06
    Milton - The beauty of Think Tank was that we got to read folks writing. When someone writes, they are able to "better" express their thoughts; as a reader it leads to a better understanding of ideas. Jim Bianco brings a different/unique perspective to issues; that's helpful. However, this format (i.e. an interview) was not. Jim talks fast, I missed a lot. He jumped around; hard to follow. (Will I make time to re-watch this to catch the points I missed? Frankly our time is valuable, it's more efficient to read.) My two cents - if TT wasn't working, Access (in it's current form) won't either. The idea that subscribers get to ask questions doesn't provide as much value as you think, namely because you all ask fantastic (and better) questions. If feedback suggests this is what subscribers are clamoring for, there are other ways you could facilitate this - Allow/Encourage guests to respond to subscriber comments. Or provide a platform where subscribers could ask guests questions in advance (Perhaps we could even vote up or down the questions, or as a community weigh in/comment on questions so that we get at what it is we are really trying to discern.). I'm just brain storming...perhaps subscribers pre-asking questions could be a "premium" RV TV service; maybe those questions are answered after the normal RV TV interview in a special segment. Thanks for listening.
    • RP
      Raoul P. | Founder
      4 December 2019 @ 22:52
      Great ideas and feedback...thank you. Taking it all on board!
    • NC
      Nika C.
      5 December 2019 @ 12:12
      »The beauty of Think Tank was that we got to read folks writing. When someone writes, they are able to "better" express their thoughts; as a reader it leads to a better understanding of ideas.« My thoughts exactly. As you said, Toby, seldom (almost never) do people in interviews present their viewpoints as coherently as they do when they have to write them down. That's why the approach of the TT was a good addition to RV TV. The current format doesn't cut it for me at all. I'm open to see what the modified Q&A section would change but IMHO, it would be better if the answers were provided in writing and thus in a structured way.
  • CL
    Chris L.
    4 December 2019 @ 20:08
    Great, $349 a year for videos that sound like they were recorded from the Lincoln Tunnel then watching a RV add about them being a production company.
    • RM
      Robert M.
      5 December 2019 @ 05:00
      Great comment!
    • JL
      J L.
      5 December 2019 @ 11:24
      hahahaha seriously considering renewing access for the comment section
  • FK
    Firoze K.
    5 December 2019 @ 09:25
    Sorry the quality of the video distracted me too much to complete the video. This was my first negative comment on RV. It's a great platform but this just didn't do it for me.
  • KD
    Kaj D.
    5 December 2019 @ 02:13
    Excellent interview. Really appreciate Jim's straight / plain speaking manner, logical reasoning etc. Thanks Ed & Jim.
  • AS
    Alan S.
    4 December 2019 @ 20:57
    Jesus, buy an apple and record the audio better.
    • AW
      Andrew W.
      5 December 2019 @ 00:51
      No, don't do that. The problem is the platform is not good at isolating the active speaker's audio. The echo is being picked up probably from Ed's side and then autocorrelated to shift it but it's not perfect and still sounds echoey. Pick a platform that has a better multiplexing algorithm to identify who the active speaker is. Assuming you can't bring studio equipment to the interviewee, the cheap fix is to have both of your guys lower their audio a bit. Using headsets by both is the best option. You can also send a directional microphone to Ed's house.
  • GF
    Gordon F.
    4 December 2019 @ 19:33
    To say that medical costs are a minor part of the economy is silly. The medical sector, including pharmaceutical companies, health insurance, and everything else related to it, is over 20% of the economy. And to calculate increases in medical costs, the BLS reportedly just uses the Medicare reimbursement rate, which is controlled by the government, and which many providers refuse to accept any more. I believe that an honest assessment of real medical cost increases, including increases in premiums, deductibles, out-of-plan charges, etc., would show a much higher inflation rate, and one which affects (or afflicts) a large portion of the economy.
    • DR
      David R.
      4 December 2019 @ 21:41
      Yes, I also thought it odd that he said healthcare was only 1% of the inflatlion calculation because it's only 1% of the economy. I expect that is the guest explaining the gov't rationale though, not the guest's own opinion of how it should be. And you're right, to the extent the inflation calculation measures healthcare, it uses those gov't controlled prices. Unreal.
  • JM
    John M.
    4 December 2019 @ 18:41
    Isn't 'Substitution' is a strategy that people employ to mitigate the impact of actual inflation? I don't think therefore it should be incorporated directly into the reported statistic (not to mention the potential for manipulation). Due to substitution, the inflation I experience may be lower (or in some cases higher) than a 'reported rate' because I choose to make different choices than the basket. Some of these substitution choices may offer me lower satisfaction but due to economic considerations I am forced to accept them. Is the reduced satisfaction from substitution reflected in the current inflation data?
    • DR
      David R.
      4 December 2019 @ 21:36
      Exactly. The example Jim cited (or just created as a hypothetical example?) is that when pizza parlor pizzas go way up in price, you can substitute a subway for less (negative inflation), which is permissable as they're both junk food. Similarly, instead of a steakhouse ribeye, you can go to McD, they're both beef. Instead of going to see a medical specialist for treatment and drugs, just go to your cheaper friendly pusher in the back ally. Etc. I'm unsure wether he was defending or just explaining the process of gov't inflation lies, but anyway, that's how gov't prints 2.3% CPI inflation instead of 12% inflation like reality. Back in the 1970's when government was less dishonest (but still lied like, "We're winning the war in vietnam"), when hamburger prices went up, we had soy burger - but inflation calculation did NOT substitute them like they would now. Thus in fact, John Williams of ShadowStats - a career long mathematical statistician employed in this field - cites real US inflation currently is in excess of 13% and has entered the exact same "runaway inflation" mode in 2019 as it did in 1979 according to his data and the same methodology used in 1979, comparing apples with apples. The big difference? Back then, we were honest about it and put Paul Volcker in the Fed to WIN; today the gov't LIES and covers-up the truth, and gets talking heads to parrot the lies. As Williams says, US inflation is perilously close to making the phase transition to outright hyper-inflation, and this seems likely given the undisciplined debt monetization that has just begun this quarter. Inflation operates with a lag, and once it's out of the bottle, it's impossible to push back in. So what does the Fed do differently now than in 1979 the last time we had this same inflation problem? The Fed uses the even more unreal PCE for "its preferred inflation measure", which is an academic licence to cheat. US going down the toilet. Short USD. Long energy.