Technology has become the only big story in the markets in high-growth countries such as China.
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Is monopoly power one of the reasons that the equity markets remain high nearly 10 years into a bull market?Wealth and power continue to flow into the technology sector more than any other – half of all American businesses that generate profits of 25 per cent or more are tech companies.Yet the tech titans of today – Facebook, Google, Amazon – create far fewer jobs than not only the big industrial groups of the past, like General Motors or General Electric, but also less than the previous generation of tech companies such as IBM or Microsoft.What's more, it is not just the top sectors that control the majority of corporate wealth, but the top companies themselves. The most profitable 10 per cent of US businesses are eight times more profitable than the average company. As McKinsey Global Institute analysis of the "haves and have-mores" in digital America shows, industries that adopt more technology quickly are more profitable.This creates strange new market dynamics and exacerbates the disconnect between Wall Street and Main Street that was already well under way since the 1980s. The markets can do incredibly well, even if the majority of workers do not, because they are increasingly driven by a small handful of top-tier companies in the information technology business.
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