Policies that pump financial markets disproportionately benefit asset holders, widening the wealth gap and fueling social angst. As a result, the mega-cap tech companies symbolizing this inequality are becoming prime targets for populist politicians seeking to channel public anger for electoral gain.

Contrary to popular belief, the market may be getting less efficient. The dominance of indexing, quant funds, and multi-manager pods—all with short time horizons—creates dislocations. This leaves opportunities for long-term investors to buy valuable assets that are neglected because their path to value creation is uncertain.

Today's market is more fragile than during the dot-com bubble because value is even more concentrated in a few tech giants. Ten companies now represent 40% of the S&P 500. This hyper-concentration means the failure of a single company or trend (like AI) doesn't just impact a sector; it threatens the entire global economy, removing all robustness from the system.

When private equity firms begin marketing to retail investors, it's less about sharing wealth and more a sign of distress. This pivot often occurs when institutional backers demand returns and raising new capital becomes difficult, forcing firms to tap the public for liquidity.

Increased retail access to alternatives helps level the playing field between individual and institutional investors. However, capturing this opportunity favors large, scaled managers like Blackstone and Apollo who can afford brand marketing and distribution. This dynamic accelerates industry consolidation, widening the gap between mega-firms and smaller managers.

After years of piling into a few dominant mega-cap tech stocks, large asset managers have reached a point of peak centralization. To generate future growth, they will be forced to allocate capital to different, smaller pockets of the market, potentially signaling a broad market rotation.

Robert Solow posits that rising inequality isn't just an economic issue; it's a political one. Initial economic disparities lead to political inequality, which then allows the powerful to shape laws (like deregulation) in their favor, further concentrating wealth and reinforcing the initial inequality.

Despite the massive growth of retail investing, politicians rarely campaign on platforms that directly address the interests of shareholders as a distinct societal group. This contrasts with other economic groups, leaving a large and financially significant portion of the population without direct political representation for their investments.

Created to help ordinary Americans invest cheaply, index funds became so successful that the top four now own over 25% of most large U.S. companies. According to Harvard's John Coates, this runaway success has given them massive, unintended power over corporate governance without a mandate to wield it.