The global economy has altered enormously since 1900, with Figure 8 showing the relative rise and decline of various economies over the period. The financial market landscape has also transformed. Figure 3 shows that from a relatively evenly distributed global equity market in 1900, the US market now dominates, today accounting for around 62% of total world equity market value, despite its decline in relative…

1. TL;DR

• Equities remain the definitive long-term wealth creator, significantly outperforming bonds and bills since 1900, though investors must now navigate record-high US market concentration, evolving industry mixes, and the nuanced, often overstated, role of gold as an inflation hedge.

2. Key Findings

Debt, Deficits & Global Imbalances: Are Capital Controls Back on the Table? #J.P.Morgan #Report

Innovation, Jobs and Inflation: Lessons from 250 Years of Disruption | March 4, 2026| Deutsche Bank Research Institute #Report

Torsten Slok:

The dramatic change in recent weeks in the narrative in markets from “the economy is strong” to “we are all becoming unemployed” is truly remarkable.

AI expectations are no longer just disrupting the equity market, with sectors such as software under pressure.

Productivity Growth, Real Wage Growth and Margin Expansion - Julius Baer

Taiwan: TSMC's dominance of chip manufacturing led Taiwan to post a $70b quarterly current account surplus in q4. That is $280b annualized, or a surplus of ~ 33% of GDP

Summary

"The current debate around artificial intelligence conflates the recursive potential of the technology with expectations of recursive economic deployment." - Frank Flight (On the fallacy of exponential adoption) [Section: Recursive Technology ≠ Recursive Adoption]

"If the marginal cost of compute rises above the marginal cost of human labor for certain tasks, substitution will not occur, creating a…

A New Age of Nations: Power and Advantage in the AI Era (Jan 2026) | Michael J. Mazarr | RAND | (Clcik Source)

Stimulus measures should boost consumption

" Numerous government stimulus measures are already in place — from tax cuts included in the One Big Beautiful Bill Act, to retroactive tax refunds, to massive tax breaks and subsidies for companies that agree to move their manufacturing operations to the United States. More recently, the president has championed the idea of “tariff dividends” for US citizens under…

The problems in software will not become a macro problem because the underlying US economy is about to take off.

There are three strong tailwinds to growth over the coming quarters:

1. Many financings for data centers have already been committed for 2026.

Academic papers are inconclusive about the impact of AI on productivity, but we believe we are in the early stages of a boom in labor productivity, see charts below and our chart book (available here). While there are questions about the magnitude of the impact at the macro level, it is clear that there are already…

Summary of Global Asset Rotations (1971–Present) by BofA Hartnett - MikeZaccardi

"The world is broadening economically, geopolitically, technologically and monetarily." - Jitania Kandhari (On the shift from U.S. concentration to global dispersion) [Page 1]

"In a high-debt world, real rates cannot remain restrictive without triggering sovereign strain, fiscal accidents or recession." - MSIM Report (Contextualizing the 'Age of Capped Real Rates') [Page 1]

*"The global economy…

"In industries where output can be measured in physical terms, a Chinese worker produces 2–3 times as much physical output as an American one." — Weijian Shan (Context: Comparing physical labor productivity in manufacturing)

"Tesla exemplifies this: its Shanghai workers are twice as productive but paid 17–18% as much as their US counterparts in nominal US dollar terms." — Weijian Shan…

AI + AV (Autonomous Vehicle) will unfortunately bring disruption in more ways that one