European Straits • 10 implied HN points • 12 Jan 26
- Businesses based on software, finance, and intellectual property enjoy increasing returns and can escape price competition, letting a small owner class concentrate large amounts of wealth.
- Global reserve-currency dynamics (especially the dollar’s dominant role) break normal exchange-rate rebalancing, locking in advantages for southern-side digital and financial firms while hollowing out domestic manufacturing.
- Physical manufacturing remains constrained by currency and price competition, so overall wealth concentration will eventually hit limits via currency shifts, falling consumption, and political backlash.