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Individual and retail investing is at an all time high. People are finally realizing how amazing 401k matches are. More people are owning assets then ever before!

An entire generation of billionaires were born from this method of buying assets, being smart and high conviction. You have Ray Dalio, Warren Buffet, Howard Marks, and Michael Burry, though these men did not all come from the same age. These men all made their wealth from investing other peoples money, doing exceptionally well over the long term, earning trust and respect, and therefore gaining the right to take fees from investors whether they made money or lost it.

Warren Buffet in particular is also quoted saying that he recommends putting 90% of investments in a highly diversified, low fee, U.S. Index fund. We have all heard this advice many times over, how the compound growth is historically 8% nominal growth since the history of the U.S. Stock Market. But as everyone is fond of saying past results is not an indicator of forward performance.

The default option for a United States citizen when they invest in a 401k is to buy 60% SP500, 40% US bonds. The U.S. market cap is hovering around 60 Trillion Dollars, the next closest is China with 11T. Then Japan and India at roughly 6 and 5 respectively.

The United States has around 340 Million people at the time of writing. The world has 8.1 Billion. The Unites States has approximately 80 million people with a Bachelor Degree or higher, behind India with 140 million and China with around 200 million.

The top 6 ETFs by assets managed combine for 3.3 trillion dollars. These ETFs all track U.S. large cap stocks, 4/6 are SP500, 2/6 are NASDAQ or growth concentrated. (Up 12.5% YTD) The 7th most is the Vanguard Developed Markets ETF, which is up 25% YTD, and and the 11th is the iShares Core MSCI Emerging Markets ETF, which is up 27% YTD.

Now I have had enough statistical barf all over this page, and I will make my point very simply. A huge percentage of money in the entire world is invested in the U.S. stock market, with the quality of labor and product difference not matching the valuation difference.

Even A.I. which has been driving the growth of U.S. tech stocks all year, is not limited to the U.S., and the idea that U.S. AI is simply the best is not true. Kimi AI, Deepseek, and Qwen, are all amazing Chinese models, that cost less than U.S. models both to subscribe to and run. These cost up to 10-20x less per token.

Deepseek’s newest model was trained on around 2,000 chips, or 6 Million dollars, with Meta using 16,000 chips.

These models are going toe to toe with companies like OpenAI, Google, Anthropic, and Perplexity with significantly less costs. China’s stock market is trading at around 11 P/E ratio, Brazil and Mexico around 11 as well. Europe and Japan around 15 P/E.

P/E ratios are not the end all be all, but they give us a decent idea about how much these companies make, versus how much they are valued at. The United States total stock market index (VTI) trades at around 27x P/E. Many of these companies are pricing in growth, potential, and blind trust.

I will tell nobody what to do with their money, but I will not be surprised if highly educated, highly incentivized builders from other countries catch up very quickly.