Monetary Matters with Jack Farley
Monetary Matters with Jack Farley

Why Macro is “Pretty Risk-On” for Equities | Tian Yang of Variant Perception

August 2, 2026

AI Summary

5 min read

Opening

Tian Yang, co-founder of Variant Perception, sees the current macro environment as broadly supportive for equities over a three-to-six-month horizon, even as the AI-driven semiconductor trade shows clear signs of exhaustion. The correction in semi stocks, he argues, resembles the "golden Bitcoin tops" of mid-2025 or gold's peak earlier this year: the fundamental story remains intact, but the price action has become a meme, too many latecomers piled in, and the narrative is now stale. The market needs a new story—perhaps real-world modeling or reinforcement learning breakthroughs—to reclaim the highs. For now, Yang is rotating out of overextended tech into value laggards like energy and financials, while keeping a barbell of secular growth exposure.

The LPPL Exhaustion Signals and What They Mean

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What you'll learn

  • 1 (00:05) **Tian Yang's Market Outlook: Risk-On Macro, Cautious on Semis** - Tian explains the macro environment remains supportive for equities over the next 3-6 months, but the semiconductor/AI trade has become a crowded meme that needs a new narrative.
  • 2 (02:56) **LPPL Exhaustion Signals Explained** - Tian defines the Log Periodic Power Law model as a bubble/crash detection system that catches the final, non-obvious leg of exponential moves.
  • 3 (05:54) **Why "Agentic AI" is Over as a Growth Narrative** - Tian argues the narrative has fully diffused to everyone, and the market is now waiting for the next leg to drive prices higher.
  • 4 (07:45) **Current Active Trades: Short UK Gilts, Barbell in Equities** - Tian shares live positions, including a short on UK Sonia futures and a barbell of energy/financials with selective tech buys.
  • 5 (08:56) **Why the Macro Regime is "Pretty Risk-On" for Equities** - Tian details the decision-tree-based macro model that finds growth okay, inflation manageable, and liquidity still supportive.
  • 6 (10:46) **End-of-Cycle Signposts: What to Watch For** - Tian identifies historical markers of major tops that are not yet present, but warns of potential catalysts like a big IPO.
  • 7 (13:38) **Market Top Checklist: Amber Warnings, Not Red** - Tian runs through their checklist, finding excessive corporate behavior (circular financing, CDS widening for hyperscalers) but a resilient economy.

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Show Notes

In this episode, host Jack sits down with Tian Yang, co-founder and head of research at Variant Perception, to analyze the current macroeconomic landscape and equity market outlook. Tian shares why macro indicators point to a broadly supportive "risk-on" environment over the next three to six months despite recent pullbacks in semiconductor and tech stocks. He discusses the exhaustion of the agentic AI rally, explaining how capital is actively rotating into value laggards such as energy, financials, and healthcare. Tian also breaks down their Log Periodic Power Law (LPPL) framework, a tactical model designed to detect market bubbles and exhaustion signals to help time entries and exits. Beyond equities, the discussion covers broader macro dynamics, including central bank policy expectations, geopolitical supply-side shocks, and regional preferences for Latin America over markets in Europe and India. Finally, Tian details the systematic strategy behind their VPX ETF, which dynamically combines capital cycle, quality, and crowding models to capture upside relative to the S&P 500. They also talk about oil, gold, and IPO window in U.S. 

Variant Perception on X https://x.com/VrntPerception

Jack Farley on X https://x.com/JackFarley96

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