Europe’s Increasing Irrelevancy

October 7, 2025 • 2 minute, 3 second read

European Stocks Global Markets

Europe’s Increasing Irrelevancy

Tech stocks are running hot. But they’re not the only game in town.

A breakdown of the top 20 global players shows a lot of tech, yes – but also the big players in energy, pharmaceuticals, financial, and retailers:

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Following the market’s massive rally, tech takes the lead – as do U.S. stocks as a whole.
(Source: Companiesmarketcap.com)

What’s most fascinating is that you won’t find a European stock in the top 20.

Even the top 25. ASML, a chip manufacturer based in the Netherlands, clocks in at the #26 spot globally.

We’re not surprised. As much as we see international investing as a way to diversify out of the U.S. dollar and its continued weakening, Europe is in a worse place.

Their GDP has flatlined over the past 15 years, against a doubling in GDP for the U.S. and even bigger GDP gains in China.

While the U.S. leads the world in AI spending, and China leads in technology like drones, what does Europe lead the world in? Regulation.

They spend more time penalizing U.S. tech firms for regulatory violations than encouraging their own tech ecosystem.

Europe isn’t even trying to play the capitalist game anymore – and it shows.

U.S. stocks are the best game in town right now, but could still take a backseat to other countries in the years ahead as richly valued AI stocks take a breather. But don’t expect too many big changes in this list in the next year – or for any European stock to crack into the top 20 anytime soon.

~ Addison

P.S. Grey Swan Live! continues Thursday at 2 PM ET. This week’s guest is none other than George Gilder.

George once handed President Reagan the first microchip, and now he says today’s tech wave dwarfs the original $6.5 trillion tech revolution of the 1980s.

Eight exponential technologies — AI, quantum computing, robotics, self-driving cars, blockchain, chips, advanced biotech, and even space — are no longer advancing in isolation.

They’re colliding, compounding, and accelerating into what could be the single greatest wealth-building event of our lifetimes.

The pace is staggering.

That’s why in Grey Swan Live!, we’ll show you how to navigate this convergence — and how early positioning could define not just your portfolio, but your legacy.

It’s not too late. Join us, won’t you?

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

Another Day, Another Circular AI Investment

October 7, 2025 • Addison Wiggin

Liquidity is flowing again, but conviction isn’t. U.S. M2 money supply has been expanding for months, even before the recent interest rate cut.

Currently, it’s up 4.8% year over year. That’s the fastest pace since 2022. That’s just enough to drive stocks higher in the short-term. Even algorithms and systematic funds will respond mechanically and buy stocks when they see liquidity rise. It’s the most fundamental indicator.

The volatility index (VIX)’s rise to 16.6, up over 2% this week, shows that big money is hedging, even as the market indices rise. After all, with signs of a slowing economy – and a government shut down – it’s hardly business as usual.

Another Day, Another Circular AI Investment

The Ghost of Bastiat

October 6, 2025 • Addison Wiggin

By then the receipts on my desk had arranged themselves into a sort of chorus. I heard, faintly, another refrain—one from Kentucky. In the first days of the shutdown, Senator Rand Paul stood alone among Republicans and voted against his party’s stopgap, telling interviewers that the numbers “don’t add up” and that he would not sign on to another year that piles $2 trillion onto the debt.

That, I realized, is what the tariff story shares with the broader budget theater: the habit of calling a tax something else, of shifting burdens into the fog and then celebrating the silhouette as victory. Even the vote tally made the point: he was the only Republican “no,” a lonely arithmetic lesson in a crowded room.

The Ghost of Bastiat

The Dollar’s Long Goodbye

October 6, 2025 • Addison Wiggin

Senator Rand Paul, (R. KY), who was the sole Republican to vote against a continuing resolution, seems to care about the actual finances of the government. “I would never vote for a bill that added $2 trillion in national debt,” Paul said in various interviews over the weekend.

The $2 trillion he’s referring to is the lesser of two proposals made by the national parties… and would accrue during this next fiscal year.

Oy.

We liked what Liz Wolfe at Reason wrote on Friday, so we’ll repeat it here: “One of the dirty little secrets of every shutdown is that everything remains mostly fine. Private markets could easily replace many federal functions.”

It’s a strange kind of confidence — one where Wall Street soars while Washington goes dark.

The Dollar’s Long Goodbye

A Vote For The Yen Carry Trade

October 6, 2025 • Addison Wiggin

The Liberal Democratic Party victory has sent Japanese stocks soaring, as party President Sanae Takaichi – now set to become Japan’s first female Prime Minister – is a proponent of stimulus spending, and a China hawk. The electoral win is a vote to keep the yen carry trade alive… and well.

The “yen carry trade” is a currency trading strategy. By borrowing Japanese yen at low interest rates and investing in higher-yielding assets, investors have profited from the interest rate differential. Yen carry trades have played a huge role in global liquidity for decades.

Frankly, we’re disappointed — not because of the carry trade but because the crowd got this one so wrong!

A Vote For The Yen Carry Trade