Monetary Matters with Jack Farley

Barry Naughton, a renowned professor and chair of Chinese International Affairs at UC San Diego, provides a deep dive into the current crises and triumphs of the Chinese economy. In this interview, Naughton analyzes why China is grappling with its most difficult challenges in decades, from a persistent housing bust to entrenched deflationary pressures. He offers a critical look at the shift from market liberalization to aggressive state-driven industrial policy, including the massive "government guidance funds" used to target a new technological revolution. The conversation explores the geopolitical showdown between the U.S. and China over critical mineral supply chains and the race for AI dominance. Naughton also addresses the demographic "graying" of China and the shifting household psychology that is transforming the nation’s growth potential. This is an essential listen for anyone looking to understand the "Industrial Policy 3.0" era and its implications for global trade and investment. Recorded on January 12, 2026.

Barry Naughton’s books:“The Rise of China's Industrial Policy, 1978 to 2020”: https://www.amazon.com/Rise-Chinas-Industrial-Policy-1978/dp/6078066595

“The Chinese Economy: Transitions And Growth”: https://www.amazon.com/Chinese-Economy-Transitions-Growth-Press/dp/0262640643

More info:https://gps.ucsd.edu/faculty-directory/barry-naughton.html

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President Trump has shaken the financial markets by proposing a strict 10% interest rate cap on credit cards, a move that sent stocks like Visa and MasterCard tumbling. In this episode, Jack and Max break down whether this policy is a genuine legislative goal or a political stunt designed to win the midterms by addressing the affordability crisis. They explore how banks might retaliate—potentially by releasing a "teaser" card with limited access—and which subprime lenders and pawn shops could actually boom if traditional credit dries up. The duo also analyzes the surprising bipartisan roots of this idea, tracing it back to proposals from Bernie Sanders and AOC. They discuss if the current dip in payment stocks represents a buying opportunity for contrarian investors. They also explore other executive interventions from the President in defense, mortgages, and the Federal Reserve. Recorded the evening of January 13, 2026.

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Pieces Discussed:Joseph Wang’s “Sleeping Giants”: https://www.stern.nyu.edu/sites/default/files/assets/documents/NPLH_AER%20(2).pdf

Buyback Capital’s “[Updates #34] The GSE's, Bill Pulte, and Implications”: https://buybackcapital.substack.com/p/updates-34-the-gses-bill-pulte-and?utm_campaign=email-half-post&r=4jms2a&utm_source=substack&utm_medium=email

“No Price Like Home: Global House Prices, 1870  2012”: https://www.stern.nyu.edu/sites/default/files/assets/documents/NPLH_AER%20(2).pdf

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Steven Novakovic, Managing Director of Educational Programs at CAIA, discusses the monumental shift from strategic asset allocation to the Total Portfolio Approach (TPA), a change recently highlighted by major moves at CalPERS. The conversation explores the evolving landscape of private markets, specifically how secondary markets are providing crucial liquidity and entry points for investors dealing with slowed distributions and the "denominator effect". Novakovic also provides a candid look at the friction between hedge fund fees and beta-heavy returns, arguing that sophisticated limited partners will not pay for beta. As alternative investments become more accessible to retail wealth, he emphasizes the critical need for education regarding evergreen funds and the unique risks of private market liquidity. Finally, the episode looks forward to 2026 educational initiatives at CAIA.Follow Steve Novakovic on LinkedIn: https://www.linkedin.com/in/steven-novakovic-caia/

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Timestamps:

00:00 Introduction to Governance Changes in Pension Plans

00:45 Strategic Asset Allocation vs. Total Portfolio Approach

03:24 Early Adopters and Global Trends in TPA

05:06 Benchmarking and Decision-Making Shifts

09:58 CalPERS Case Study: Governance and Tactical Opportunities

17:32 Impact on Managers and Investment Strategies

22:08 Current Market Trends and Private Credit

25:54 Private Equity Distributions and Secondary Markets

35:32 Reinvesting Portfolio Proceeds

36:39 Understanding Secondary Market Buyers

37:09 Benefits of Secondary Allocations

39:14 Challenges and Strategies in Secondary Markets

45:03 Hedge Funds vs. Equity Markets

46:35 Evaluating Hedge Fund Performance

49:02 Active Management and Fee Structures

56:53 Educating Investors on Alternatives

01:03:00 CAIA's Educational Resources

01:05:44 Upcoming CAIA Programs

Dr. Michael Power, a seasoned financial analyst, consultant, and strategist, joins Jack to discuss his recent work that predicts the Chinese A.I. industry may soon beat the U.S. at its own game. Dr. Power explains what makes the Chinese approach fundamentally different from U.S. labs like OpenAI and how it will likely affect the Chinese economy, the worldwide adoption of A.I., and the valuations of U.S. A.I. companies. As Dr. Power explains, China has the potential to not only catch up to the U.S., but to become the global leader in artificial intelligence. He and Jack get into the weeds to cut through the noise and get a read on what is really happening with Chinese A.I. Recorded on January 7th, 2026.

 

Read Dr. Power’s No More Moore? Essay https://tinyurl.com/hvxdubbw

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In this episode of Monetary Matters, Max Wiethe sits down with Michael Kao, CIO of Cantos Capital Management and the Kao Family Office, to unpack the real energy risks facing the U.S. economy. The conversation opens with Venezuela and the Trump administration’s push to reshape global oil supply. Michael explains why Venezuela’s vast reserves are unlikely to move the market quickly, why OPEC spare capacity still caps oil prices, and why he remains structurally bearish on oil despite constant fears of shortages. From there, the focus shifts to what Michael believes is the true vulnerability: natural gas. He lays out a three-pillar thesis centered on premature electrification, the explosive growth of AI data centers, and expanding LNG exports. Together, these forces are driving electricity demand higher for the first time in decades, straining a power grid that increasingly depends on natural gas for baseload generation. The episode concludes with a discussion of how Michael is positioning for this shift, why he favors natural gas mineral rights over commodities or equities, and why natural gas is fundamentally different from oil when it comes to geopolitics and government intervention.

Read Michael’s Substack, “Macro/Geopolitics/Investing - The Energy Achilles' Heel of America” here: https://www.urbankaoboy.com/p/re-macrogeopoliticsinvesting-the

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Timestamps:

00:00 Introduction to Geopolitical Energy Security

00:46 US Energy Concerns and Venezuela

01:33 Venezuela's Oil Production Potential

03:22 Natural Gas: The New Dependency

04:49 Challenges in Oil Production and Pricing

15:16 The Role of Natural Gas in the Energy Market

20:58 The Future of Natural Gas and Electricity Demand

31:13 Investment Strategies in Natural Gas

32:03 Challenges and Risks in Natural Gas Trading

33:45 Advantages of Mineral Rights Investments

38:16 Global and Local Dynamics of Natural Gas

40:39 Data Centers and Energy Demand

42:39 Future of Natural Gas and Market Trends

52:26 Investment Considerations and Strategies

01:03:12 Conclusion and Final Thoughts