Importance of Insights: Example of “World Equity Market Cap”

I have written multiple times the importance of developing insights and understanding, looking beyond just data points.

I feel, in today’s era of WhatsApp University graduates, people tend to theow data points at you and spread propaganda and fake news. No one bothers to go deep and question the data or be more skeptical of accepting everything at face value.

Here is a good example of that which I found on LinkedIn.

It is often said that the US equity market is not as lucrative and the real opportunity is in the Rest of the World, or in Emerging Markets – i.e. the equity markets there.

How true is this? How big is the opportunity?

Here is the post from LinkedIn:

Now please don’t tell that we can sell US market and buy rest of the world and still have money in the bank to buy gold and bitcoins and thereby buying 85% of global GDP by selling 15% of the global GDP……Dedicated to those who keep on posting on Mcap of RIL vs.entire B group universe etc.

So, the US equity market is far bigger than all of the others put together!

I know that this view or argument is also too simplistic. It woukd be naive to jump to any conclusion based on this chart. For example, it may well be that the majority of money in the US Equity Market has come from the rest of the world (not US). Just an example…

The point is: Be wary of any sweeping conclusions and data points and always dig deeper to understand the nuances.

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