Old economy is new and new economy is old

Part of the previous “old economy”, such as industrials (e.g. heavy manufacturing), material (e.g. mining), utilities (e.g. electricity) are becoming the new “new economy” due to AI and related investments.

Indeed, AI isn’t just an app-layer story; it’s a capex + physics story.

They’re on the critical path of AI expansion, and they’re supply-constrained enough to earn economic rents.

Meanwhile, part of the previous “new economy” is becoming old, like software, e-commerce etc.

Software is less scarce, with AI-assisted coding and commoditized building blocks

E-commerce matured in many markets. China is the prime example. China’s gov reported e-commerce (physical goods) growth has been below 10% for 4 consecutive years since 2022.