Oct 7, 2026 · 43 min
Listen from 29:55
Listen at 29:55
Rising yields test stocks, housing and high-leverage growth
Rates Back On The Rise… And Used Car Market Shifting Into Reverse 10/7/26
Higher long-term rates are reshaping valuations, borrowing costs and market risk across bonds, equities, housing and speculative growth.
- 1Treasury yields reflect a contested mix of inflation, growth, debt supply and leveraged trading positions.
- 2Mortgage rates above 7.6% pressure homebuilders and housing activity even as large-cap technology earnings remain resilient.
- 3The episode pairs bullish cases for cybersecurity, SpaceX and Delta with falling used-car prices and uncertain GLP-1 benefits.
Don't miss
Jim Bianco argues that five- to thirty-year Treasury yields around 5% may represent fair value for an economy with roughly 3% inflation and 2% real growth.
The brief
The Treasury selloff sets the episode’s central question: are higher long-term yields signaling inflation and growth, or simply the market absorbing an unprecedented wave of debt supply?
The panel argues that auctions, foreign demand and leveraged hedge-fund positioning can amplify Treasury moves, while dollar strength and overseas fiscal concerns keep U.S. debt attractive.
Jim Bianco makes the bullish bond case: five- to thirty-year yields near 5% may be fair value if inflation stays around 3% and real growth near 2%.
Higher rates are already pressuring defensive stocks, homebuilders and mortgage-sensitive businesses, with rates above 7.6% weighing on housing activity and related companies.
Beyond rates, the panel finds investable tension elsewhere: cybersecurity demand is rising with AI, SpaceX is adding debt, used-car prices are falling, and Delta attracts bullish positioning.
What was said on this episode
40 statements · 21 positive · 15 negative · 1 mixed · 3 neutral
The Fed has at least one additional rate hike remaining.
“I think there's at least one more hike left in the Fed.”
Listen at 2:54
Treasury issuance is driving higher bond yields.
“I think it's issuance.”
Listen at 4:07
Treasury yields have entered a new trading range.
“We're definitely in a new range in that new range.”
Listen at 6:07
French government bond yields experienced a sharp surge.
“there was a blowout in French yields.”
Listen at 8:03
Investors continue buying U.S. Treasury bonds.
“People are still buying them.”
Listen at 8:38
Bond-market pressure on France and Italy will continue without global-credit clarity.
“And that's going to continue until we get some clarity even on, I think, on global credit, frankly.”
Listen at 10:21
Treasury yields may need to rise further in the short term.
“In fact, it feels like it needs to go higher.”
Listen at 12:04
Bond-market volatility is currently comparable to the tariff-related episode.
“And that's the kind of volatility we're having now in the bond market.”
Listen at 13:03
Interest-rate-sensitive stocks will continue declining.
“I think interest rate sensitives are going to continue to make a move lower.”
Listen at 14:07
Industrials, staples, and consumer discretionary will underperform with higher rates.
“I do think industrials, staples, consumer discretionary will continue to underperform in a higher rate environment.”
Listen at 14:44
Mega-cap companies with substantial cash flow are relatively resilient to high rates.
“they're in a fairly good spot when you think about where rates are.”
Listen at 15:21
TLT options flows suggest traders see a possible end to the sharp ten-year yield rise.
“which suggests that at least those who are using TLT to play bonds are beginning to think that maybe there's an end in sight to the sharp raise in the 10-year.”
Listen at 16:19
Five- to thirty-year bonds now offer sufficient value to re-enter the market.
“that's why after six years, I finally said, OK, now's the time to start moving back into the bond market.”
Listen at 17:13
Treasury maturities of five years and longer are fundamentally appropriately priced.
“Anywhere from five years on out, I think, is really, from a fundamental standpoint, is the appropriate levels for the interest rates.”
Listen at 17:20
The zero-rate and money-printing era is over; current rates are normal.
“No, I think that era is over. And now what we're looking at is normal interest rates.”
Listen at 18:57
A credit cycle is emerging first in CCC-rated debt.
“Yeah, I think you're going to start seeing a credit cycle, and you're seeing it in the lowest rated credits, in the CCC credits.”
Listen at 19:46
Higher refinancing rates could eventually create problems for leveraged companies.
“I don't perceive that as a problem right now, but it's definitely on my radar watch list of things that could potentially be problematic.”
Listen at 21:00
Bond yields could pull back after the Treasury auction.
“So I think you could see a pullback in rates from here going forward.”
Listen at 21:36
Home-improvement retailers will struggle until home prices correct substantially.
“And until we do see that, then it's going to be a struggle for many of these.”
Listen at 23:16
Zillow needs higher transaction volume and is currently below required levels.
“they need volume. Right. Because they they need volume and the margin on that volume will be great. But they're below where they need to be.”
Listen at 23:35
More AI agents increase cybersecurity requirements.
“the more agents you have, the more cybersecurity that you need.”
Listen at 24:54
Cybersecurity companies should gain value as AI agents proliferate.
“all of them should, in theory, increase in value with the more agentic forces that we see”
Listen at 25:15
Cloudflare handles 20% of global internet traffic or infrastructure.
“Cloudflare has 20% of the global internet.”
Listen at 25:24
CrowdStrike and Palo Alto Networks trade at very expensive forward valuations.
“the valuations aren't cheap. The valuations are really expensive, like CrowdStrike's 125 times forward. Palo Alto's probably 95 times forward.”
Listen at 25:55
Palo Alto Networks is unsuitable for value-oriented buy-and-hold investors.
“for a buy and hold, it's probably not the best thing for a value investor.”
Listen at 27:07
SpaceX’s debt-funded expansion is supportable because customers are already paying it.
“So I think if they didn't have a customer and they're just doing it for the hell of it, it would be worrisome. But I think the market will buy this one back.”
Listen at 28:57
SpaceX’s recent launches and recoveries support its long-term equity story.
“they've been executing. They've been doing the things that people who really want to own the stock for the future have to be elated about.”
Listen at 29:22
New-car market conditions drive used-car market conditions.
“new car market actually drives what happens with the used market.”
Listen at 33:14
Higher financing rates will continue pressuring used-car demand.
“if you shop on payments and you have higher rates, that is going to continue to put pressure on it.”
Listen at 34:37
Ford is an attractive purchase in the current auto market.
“I'd be a buyer of Ford.”
Listen at 35:21
GM is attractively valued, pays a dividend, and has improved profitability.
“GM is a company that at less than six times, it's probably low 5 PE handle. and is paying a dividend and has done a lot of great things to become more profitable.”
Listen at 35:50
Weight loss probably reduces biological age regardless of treatment.
“if you lose weight, if right now we all lost 20 pounds, our biological age probably is reduced.”
Listen at 38:36
GLP-1 users’ cells show slower biological aging than non-users’ cells.
“the biological age of the cells, it ages slower than those people not on a GLP-1.”
Listen at 39:02
Options imply Delta could move roughly $4–$4.50 around earnings.
“the options market is implying that Delta could move about $4 to $4.50 higher or lower”
Listen at 39:43
Delta is the preferred airline investment among its peers.
“Among the airlines, I like this one best.”
Listen at 40:27
Delta’s continued gross-margin growth supports holding the stock.
“why not hang in there on a company that's continued to grow their gross margin?”
Listen at 41:12
Investors should own Delta rather than another airline.
“So if you're going to own one, I would own Delta.”
Listen at 41:39
Investors should own XLV if pharmaceutical firms found an anti-aging breakthrough.
“if any pharma companies have discovered it, I think you want to own XLV.”
Listen at 42:10
Google is attractively valued after lagging recently.
“I like Google, hasn't really participated so much recently, but I think valuation's attractive.”
Listen at 42:32
Cloudflare is the speaker’s preferred cybersecurity stock.
“I'm going to stick with the NET as the symbol, Cloudflare.”
Listen at 42:39
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.