Claude Opus 4.8 disagrees with your numbers. It says:
"The US makes up roughly 60–65% of global stock market capitalization as of early 2026, by far the largest single share. Let me give you the rough breakdown of how the major markets compare.
The US sits around 60–65%. Behind it, the next largest are typically Japan (~5–6%), China (~3–4%, mainland and Hong Kong listings combined), the UK (~3–4%), and then France, India, Canada, Germany, and Switzerland each in the roughly 2–3% range. India's share has been climbing in recent years and now rivals or exceeds the major European markets depending on the index used.
A few things worth flagging given how the numbers get cited. The exact figure depends heavily on the index provider and methodology. The MSCI ACWI (which is free-float adjusted and excludes most frontier markets) tends to put the US near 63–66%. The broader FTSE All-World or total-market measures that include more of China's domestic A-shares pull the US share down somewhat. China is the big methodology swing factor because a large portion of its market is state-owned and not free-float, so float-adjusted indices understate its gross market cap considerably."
That 60-65% is in line with other numbers I have heard over the last year which is why I bothered to ask the AI.
Well I kind of take it back. Energy in full accord. Large money center banks (which I own) I don’t have a good pushback. China to me is off limits given Xi no matter how much I respect the industriousness and ingenuity of the Chinese people. I tend to heartily agree with 95% of your non-consensus calls, so I cool it with snark.
Erik I’m curious if your screens would capture emerging market banks like BCA in Indonesia? I’m definitely not in my comfort zone analyzing banks, but my brother has been interested in the Indonesia ETF for a while and with the 40 to 50% move down over the last year. I was taking a look at some of the main components and BCA looks like it has been a very bank long term and is now looking pretty cheap relative to its metric historically.
Wow. I hadn't noticed the Indonesia crash. Interesting... Yes, the Indonesian banks are in the Factor Model App, but not in QARV. I will see if I can fix that. I haven't looked at Indonesian banks much... but maybe it's time. Thank you! Here is the link to the data apps. https://www.ywr.world/p/data-apps.
Yes, they are all good. BNP looks especially cheap here, but Andrea Orcel at Unicredit is a race horse. I'd probably go with Unicredit for the long term.
"trend #1: Re-architecting global energy supply" seems so obvious but difficult to execute with few securities. No one wants a portfolio full of energy stocks. Am yet to identify one or two securities that captures the play.
Claude Opus 4.8 disagrees with your numbers. It says:
"The US makes up roughly 60–65% of global stock market capitalization as of early 2026, by far the largest single share. Let me give you the rough breakdown of how the major markets compare.
The US sits around 60–65%. Behind it, the next largest are typically Japan (~5–6%), China (~3–4%, mainland and Hong Kong listings combined), the UK (~3–4%), and then France, India, Canada, Germany, and Switzerland each in the roughly 2–3% range. India's share has been climbing in recent years and now rivals or exceeds the major European markets depending on the index used.
A few things worth flagging given how the numbers get cited. The exact figure depends heavily on the index provider and methodology. The MSCI ACWI (which is free-float adjusted and excludes most frontier markets) tends to put the US near 63–66%. The broader FTSE All-World or total-market measures that include more of China's domestic A-shares pull the US share down somewhat. China is the big methodology swing factor because a large portion of its market is state-owned and not free-float, so float-adjusted indices understate its gross market cap considerably."
That 60-65% is in line with other numbers I have heard over the last year which is why I bothered to ask the AI.
Thank you. The data from the SIFMA factbook was from 2024. So yes it probably is over 60% by now.
You know my take on China … 🇨🇳
ps: what do you see on Alibaba online retail earnings?
I see modest growth last few quarters but must be missing something
Thanks Erik
Not your strongest piece
Thank you for the feedback. Maybe revisit this piece in 2 years. It will age well.
Fair enough…I respect your work a great deal
But I may have tried to address too much in one post and so the ideas weren’t developed enough.
Well I kind of take it back. Energy in full accord. Large money center banks (which I own) I don’t have a good pushback. China to me is off limits given Xi no matter how much I respect the industriousness and ingenuity of the Chinese people. I tend to heartily agree with 95% of your non-consensus calls, so I cool it with snark.
You might be right. The China trade just can't get going.
Erik I’m curious if your screens would capture emerging market banks like BCA in Indonesia? I’m definitely not in my comfort zone analyzing banks, but my brother has been interested in the Indonesia ETF for a while and with the 40 to 50% move down over the last year. I was taking a look at some of the main components and BCA looks like it has been a very bank long term and is now looking pretty cheap relative to its metric historically.
Wow. I hadn't noticed the Indonesia crash. Interesting... Yes, the Indonesian banks are in the Factor Model App, but not in QARV. I will see if I can fix that. I haven't looked at Indonesian banks much... but maybe it's time. Thank you! Here is the link to the data apps. https://www.ywr.world/p/data-apps.
Are Chinese banks still considered interesting outright and as a more focused angle of the China trade?
Yes, I always focus on China Construction Bank and China Merchants Bank. China Merchants is the slightly more private bank with a strong credit card business. Here is the post I wrote earlier about Chinese Banks. https://www.ywr.world/p/ywr-who-am-i-sector?utm_source=publication-search
Barclays, BNP, Unicredit? All good plays on Euro banks?
Yes, they are all good. BNP looks especially cheap here, but Andrea Orcel at Unicredit is a race horse. I'd probably go with Unicredit for the long term.
"trend #1: Re-architecting global energy supply" seems so obvious but difficult to execute with few securities. No one wants a portfolio full of energy stocks. Am yet to identify one or two securities that captures the play.