Betting on the second Great Divergence
The second Great Divergence will be led by the U.S. and China.
The first, following the industrial revolution, yielded a massive economic delta between the west and the rest of the world.
The Industrial Revolution concentrated extraordinary economic growth in the countries that first assembled the capital, energy, institutions, and machinery necessary to drive it: which led to the Great Divergence, as the West pulled away from the rest of the world.
And now 200 years later, we’re rapidly accelerating towards the intelligence revolution: what I believe will produce the most significant economic growth in human history.
And, the US, alongside China, will be the first to experience this revolution economically. Our mutual abundance of compute, energy, enormous capital, and concentration of AI talent, alongside our rivalry, will lead to explosive growth like nothing before.
So, the ultimate question becomes: how do you position yourself for the intelligence revolution?
If you ask the average entrepreneur in Silicon Valley, the answer is obvious: “start an AI startup.”
This is stupid. The vast, vast majority of “AI startups” are software built on-top of models from OpenAI and Anthropic, and software alone is being increasingly commoditized.
As rain pours from the sky, the self-proclaimed “entrepreneur” collects it in jars, tries to sell it to pedestrians, and wonders why no one is buying.
I believe there are three ways to position yourself:
- Work for OpenAI, Anthropic, or a hardware company like NVIDIA.
- Accumulate scarce assets like real-estate on Earth.
- Bet on the second Great Divergence.
As the United States and China run away from the rest of the world in economic prosperity, we must find a way for everyone to participate.
There are many ways to do this, but I care most about ensuring the average person globally can themselves be a financial beneficiary of this revolution alongside the Americans and Chinese.
If the second Great Divergence happens, two economic tailwinds would occur:
- Capital will increasingly flee weaker currencies for the dollar.
- U.S. equities will capture a disproportionate share of that growth.
Two Freedom Technologies will enable both of the above for anyone, anywhere, regardless of the desires of their local government.
The first is stablecoins, which I believe remain one of the most underestimated technologies in the world. If demand for the dollar rises, stablecoins will be the channel through which most meet it.
And the second is tokenized stocks: in the same way stablecoins will allow capital movement into the U.S. dollar, tokenized stocks will do the same for U.S. equities, which will be even more desirable.
The Great Divergence looms. But unlike the first, anyone can be on the winning team.