Chicago can’t go bankrupt… and the Fed is “not doing QE” while buying tens of billions in Treasuries to keep the funding markets from cracking. So what happens next: higher inflation, higher long rates, and a steeper yield curve — or a policy pivot that no one wants to admit?

In this episode of the Future’s Edge, Jim Iuorio and Bob Iaccino are joined by Jim Bianco (Bianco Research) for a fast, blunt conversation on what’s really happening beneath the headlines:

What we cover:

- Chicago’s fiscal trap: why investors still buy Chicago bonds, and the Chicago Public Schools as a massive junk issuer

- The real issue: Illinois’ constitution and why “no Chapter 9” changes everything

- Why 40% of Chicago’s budget is effectively paying for the past (pensions, retiree healthcare, and debt service)

- Two alarming datapoints: 911 call response deterioration and low murder clearance rates

- The Fed’s “Reserve Management Purchases” (RMP): why it looks and behaves like QE even if the label changes

- Repo market stress explained in plain English: how funding the Treasury market actually works

- The bigger problem: a $38T Treasury market growing alongside persistent deficits

- Fiscal dominance: why “issue more T-bills and cut rates to 1%” is a hand-grenade strategy

- Rates & the long end: why Bianco sees the curve steepening and long-term yields staying pressured

- AI and jobs: productivity vs disruption, and why the timeline may be longer than the hype suggests

- Population growth shock: what negative net immigration could mean for payroll expectations and markets

- Bitcoin & crypto: why Bianco is long-term bullish — and why he thinks the space “loses the plot” when it chases short-term “number go up”

If you want a clear, no-BS walkthrough of why the Fed is intervening, why deficits matter, and why long rates may not come down the way most expect, this one’s for you.

Follow/Find Jim Bianco: @biancoresearch

https://www.biancoresearch.com/

Follow along on social media:

Twitter: https://x.com/bob_iaccino

Twitter: https://x.com/jimiuorio

LinkedIn: https://www.linkedin.com/in/bob-iaccino/

LinkedIn: https://www.linkedin.com/in/james-iuorio/

Newsletter: http://theunfilteredinvestor.com/

Chapters:

00:00 Intro + why this episode matters

02:00 Chicago bonds, pensions, and “why anyone buys this paper”

05:00 Where it ends: services cut to pay the past

11:00 Why cities mattered historically — and why that’s changing

14:40 “Not QE” explained: Reserve purchases & how the Fed creates money

18:30 Repo market stress + financing the Treasury machine

20:50 Deficits, inflation, and the Fed as enabler

35:10 Population growth, immigration, and payroll math

39:10 Stagflation risk + why 3% inflation doesn’t “fix” affordability

41:20 Fiscal dominance + the long end and steepener trade

45:00 Bitcoin: adoption, disruption, and why the real enemy isn’t ETH