The Master Investor Podcast with Wilfred Frost · Oct 4, 2026 · 59m · 43m saved
With Jim Bianco, President and Macro Strategist at Bianco Research
In 2020 the average US bond yielded 2% with a duration of seven, Jim Bianco said, so a one-point rise in yields cost an investor 7% against a 2% coupon. Today both numbers are about five and a half.
He had been bearish on bonds since 2020, through six years of rising yields. He has now started buying them.
"That expensiveness is gone." — Jim Bianco
Jim Bianco, President and Macro Strategist at Bianco Research, on The Master Investor Podcast with Wilfred Frost, founded his firm 20 years ago after roles at UBS and Lehman Brothers. He manages the WisdomTree Bianco Total Return Fund and recently started his own podcast, Rational Dissent. The interview was recorded in London on the Thursday before it ran.
The full interview is covered here so you can skip it. 59 minutes of audio, 16 minutes of reading.
Here are the 15 calls that matter.
Key Takeaways
Bonds are fairly valued for the first time in 6 years, Bianco said, though not cheap
He is buying in stages: more at high-5% yields, more again at 6%
The Fed cut rates by 1.75 points from September 2024 while the 10-year yield rose 1.3 points, a first in 50-plus years
The Fed's unanimous 12-0 hike may have been a mistake, because it puts all the pressure from the White House on the chairman
He bought long-term TIPS rather than ordinary Treasuries as a hedge against yields rising further
The S&P 500 is two stock markets: about 50 AI stocks and 450 others that increasingly move apart
Total US debt is 364% of GDP, against 362% in 2006, so he thinks the debt problem is overstated
Expect 4% from cash, 5% from bonds and 6% from stocks over the next several years
A bear market is measured in time, not price: the 2000 peak took 13 years to recover, the 2020 one 5 months
1. Bonds Are Fair Value Again
The host noted that yields were at fresh 28-year highs and that the UK 30-year yield had crossed 6% that morning. Bianco, bearish on bonds since 2020, has changed his view.
Bianco said the bond market is now fairly valued after six years of being too expensive
"I see the bond market as being maybe fairly valued now, where it was too expensive for the last 6 years." — Jim Bianco
He used modified duration, the percentage a bond's price moves when yields move one point, to explain it.
"So, in 2020, the average yield was 2% and the duration was seven." — Jim Bianco
A rise from 2% to 3% therefore cost 7% of an investor's money against a 2% coupon. Today the average all-in US bond yield and the duration are both about five and a half. In 2020, he said, a move of about a third of a point against him was enough to lose money. Now it takes a full point.
He is going long bonds without predicting a rally
"So, I'm not talking about the economy falling or the inflation situation turning around, but now you're finally getting paid for the risk appropriately." — Jim Bianco
