Economics & Finance
Extreme Asset Bifurcation & The Numerator Game
When economic structures develop unevenly (K-shaped divergence), traditional valuation logic breaks down. Asset returns are no longer driven by broad market factors, but instead by the 'numerator' (corporate earnings and growth). In this regime, the denominator (interest rates) has diminished influence on valuations. Capital systematically flows away from 'cheap' assets and concentrates in assets with proven growth certainty.
Read the daily articles behind this idea on the Chinese edition.