Risk Assets have Front-Run Reality

Published on
March 25th, 2019
32 minutes

Risk Assets have Front-Run Reality

The Expert View ·
Featuring Tian Yang

Published on: March 25th, 2019 • Duration: 32 minutes

Risk assets have rallied aggressively in the first quarter of 2019, in what appears to reflect an anticipation that global central banks will repeat the reflation trade that they initiated in early 2016. But Tian Yang, head of research at Variant Perception, believes that investors may be ignoring the shifts in central banks' priorities and in the inflation picture that have transpired between then and now. For that reason, the recent divergence between asset prices and leading indicators could leave many markets looking vulnerable, Filmed on March 19, 2019 in London. Variant Perception's research note 'No Deja-Vu: 2016 Reflation Analogy Does Not Fit' was published on Real Vision's Think Tank on March 14, 2019. Variant Perception's research note 'Understanding Bear Markets' can be found on their website by clicking here: https://bit.ly/2HKqh3M



  • JS
    John S.
    16 April 2019 @ 20:57
    Just got around to this...what a brilliant guy Mr Yang is. I certainly learned some new things and will rerun this at least once simply because he's able to verbalize thoughts and connect dots faster than I can absorb what he's saying. Remarkable.
  • aa
    allan a.
    8 April 2019 @ 01:10
    Believe the market cycle is determined by the unemployment rate falling and staying down for about a year and 4 months. Combine that with an inverted yield curve that has just un-inverted and then within months a recession happens. Can't say when but one look at the FED graphs and you know it's coming
  • aa
    allan a.
    8 April 2019 @ 00:54
    Really liked this one. Take a look at the correlation between gold and the change of M1. Gold has multiple correlations at different times. The US dollar, inflation, price of oil and during the Great Recession not M1 but the percent change in M1 year over year. When the FED starts printing money gain it might follow that same pattern. Hard to say.
  • SP
    Stephane P.
    8 April 2019 @ 00:41
    This is so brilliant, he is hard to follow sometimes....
  • DC
    Dan C.
    2 April 2019 @ 20:36
    Brilliant as ever. I’ve had the pleasure of reading quite a bit of their work and it’s all first class. Generally institutional only though sadly. Jonathan Tepper is the founder of VP so for those seeking more insight, read his latest book The Myth of Capitalism.
  • SH
    Stephen H.
    2 April 2019 @ 14:01
    Great interview Tian, excellent job conveying the approach with leading indicators and the linkages & interconnections. Look forward to seeing you back on Real Vision again.
  • CT
    2 April 2019 @ 09:26
    One of the best interviews I have seen on RV. Would put it up there with Druck. The quality of arguments and framework is just fantastic.
  • LC
    Lloyd C.
    2 April 2019 @ 07:32
    Or... Japan and the ECB can print a boatload of money, which finds its way into assets in the US.
  • LC
    Lloyd C.
    2 April 2019 @ 07:15
    At the end of the day, pension funds need higher balances to pay retirees, ergo, the Fed must support asset prices, else they will lose their mandate.
  • MN
    Mario N.
    29 March 2019 @ 02:54
    First off we didn't cross the 20% bear market threshold on S&P500 close. Second, the other non-sentiment driven bear markets historically (eg 1998 being sentiment driven and not associated with a recession) came along with recessions that worsened the bear. We don't see that now albeit there are risks as noted. So far December was a bad correction so double bottom isn't necessary by definition.
    • MN
      Mario N.
      29 March 2019 @ 02:57
      Just to to be clear - really enjoyed the interview though and felt the discussion was great! Would love to see Tian back :)
  • SS
    Sean S.
    27 March 2019 @ 16:42
    Not related to the video but it was better back when you pause the video it didn't show all the buttons just showed the screen so I can pause & view the charts.
    • mb
      michael b.
      28 March 2019 @ 05:23
      Once paused, tap somewhere on the video where there is no button, like bottom right. This immediately removes buttons, at least on ios app, and you’ll see just paused picture.
  • NG
    Nick G.
    25 March 2019 @ 16:43
    Really enjoyed the interview till he came up with that trade short ES long FF spreads. Could not stop sniggering for an hour.
    • ly
      lena y.
      26 March 2019 @ 20:36
      very interesting how this comment is received by viewers!
    • SM
      Stuart M.
      27 March 2019 @ 21:36
      I don't get it.
  • JO
    Jon O.
    27 March 2019 @ 14:27
    I'm constantly scouring the internet for the latest interview with anyone from Variant Perception. These guys have nailed so many of their predictions. If Real Vision felt the urge to interview these guys on a monthly basis (perfectly ok with more :) ) I'd be the happiest subscriber alive
  • JH
    Jay H.
    27 March 2019 @ 12:42
    上有政策,下有对策。It’s a great idiom in Chinese. Nice work Tian, very clear.
  • LT
    Lucas T.
    27 March 2019 @ 03:04
    I have been following VP for a couple years now. I always think that if I could get access to a couple years of their content I would probably learn more there than anywhere else.
  • VP
    Vincent P.
    27 March 2019 @ 00:48
    The energy and spirit along with data delivery works great. Can't get enough!
  • BT
    Brian T.
    26 March 2019 @ 15:08
    Wow! Impressive breadth of knowledge! Thank you Tian for an excellent overview and perspective. Only one minor request would be to speak just a little slower for those of us who have slower ears (or less understanding!)
    • ly
      lena y.
      26 March 2019 @ 20:34
      I always use both audio and transcript to have a deeper understanding of issues.
  • PW
    Philip W.
    26 March 2019 @ 20:16
    Very impressive. Great format.
  • NC
    N C.
    26 March 2019 @ 15:01
    "If I really think about it from an institutional point of view, the main thing the Fed is here to do is to preserve itself...broaden its mandate." Variant Perception at its best. Thank you for the great interview.
  • MK
    Michael K.
    26 March 2019 @ 11:46
    Big up to RV for finally having voiceover of the questions that were only screen visible. I consume 2/3 of my RV time by audio only say on a commute. Helps.
  • PH
    Pompeu H.
    26 March 2019 @ 09:20
    Fantastic interview!
  • KH
    Kavi H.
    26 March 2019 @ 09:20
  • IH
    Iain H.
    26 March 2019 @ 09:04
    Excellent, clear and justified. Don't understand the thumbs down?
  • JF
    Joseph F.
    26 March 2019 @ 02:08
  • GR
    Garey R.
    26 March 2019 @ 02:05
    Well done! From start to finish a clear and thorough analysis rooted in observable data sources!
  • WC
    William C.
    26 March 2019 @ 01:31
    Superb! Who the heck gave this video a "thumbs down"?
  • PG
    Philippe G.
    25 March 2019 @ 23:20
  • TE
    Tito E.
    25 March 2019 @ 21:49
    The Variant Perception guys are excellent imho
  • RA
    Robert A.
    25 March 2019 @ 19:10
    Really, really good Interview! This young man is a great communicator and has a framework he is quite familiar with. Kyle Bass has always said that he loves to have very bright people try to find fault with his thesis (and really means it, IMO). Would love to have Tian take a shot at punching any holes he can find in Kyle’s excellent China/ Yuan thesis. I wonder if Kyle would be willing to have a discussion with Tian, and if he thinks it was productive could allow we RV’ers to be in on it?
  • HK
    Himali K.
    25 March 2019 @ 16:25
  • JH
    Jesse H.
    25 March 2019 @ 15:49
    Impressive and thought-provoking. And the way he looks at things makes a heck of a lot of sense. Thanks RV and please bring him back soon.
  • PU
    Peter U.
    25 March 2019 @ 15:27
  • CC
    Christopher C.
    25 March 2019 @ 14:29
    Unbelievably bright young man. Mr. Yang tied together many strings I was aware of and wove them into a cohesive, thought provoking, and convincing narrative. Especially liked his analysis of the delta of the action/underlying drivers in 16' and today, and his explanation of how/why he sees Soros' theory of reflexivity being played out. Though he did not say it explicitly, he makes a strong case that "The rules are changing."
  • JA
    James A.
    25 March 2019 @ 13:39
    smart kid. Good to see more guests from the global capital of finance (London).
  • BA
    Bhagwanta A.
    25 March 2019 @ 13:25
    Informative, easy to understand and backed up with right information.
  • MJ
    Max J.
    25 March 2019 @ 12:34
    An excellent interview. Professional, factual, honest, real world, and spot on to reality (in my opinion). Please bring Tian back soon.