Trade Routes & Chokepoints: A Neo-Mercantilist Deglobalized World

I’ve long enjoyed More or Less and it’s usually about tech and Silicon Valley. But in an episode, they introduced a very helpful concept for the new emerging geopolitical landscape. You can check out the episode here: https://www.youtube.com/watch?v=pWntiqnjXYc.

I warn you this is a long write up and I took plenty of quotations from this conversation. It was so good. Basically we should think about key countries and companies as Connectors on a trade route. 

“Well, the private conference take was…..about the importance of trade routes and mercantalism 2.0. But the basic point is that if at the highest level like we kind of all grew up in a globalized world, right? And so frictionless global there are no trade routes like it's just global, right?

Like you can trade with anyone. All ports are open. We're moving into this world of trade routes that trade routes mattering. If you're the camel people who run a trade route that's super valuable. And I think the interesting thing on what these new trade routes are talking about in a world of low trust, high fakes and AI and lack of transparency and might is right power and things……you know there's going to be effectively  the king of your world, you want to own a dominion right? Or the other way to be powerful is to sit on a trade route and control it, right? So, you know, famously Jerusalem was a really cool city back in the day. They didn't really make anything, but they sat on a really important trade route with some swords and could control the trade in the region, right? 

And so in 2025, what are the trade routes? There's a trade route from New York finance to Silicon Valley Tech, right? That's a pretty robust one. There is a Silicon Valley tech to Tel Aviv route. Doesn't it go from Riyadh to Silicon Valley? There's absolutely, but this is a great example. Like Riyadh to Silicon Valley is an absolutely established trade route. And the people who control that deal. Where does Masa (Masa of Softbank) spend most of his time these days?” 

A connector can be an individual as well too. Usually super influential people with massive personal brands. Masayoshi Son as mentioned. There is more to this and the following is a super long quote but it is worth reading to understand how to position yourself in the future. 

”You've got the right narrative which is like it's not about an interconnected open world. It's about a series of trade routes and there are brokers or the key people who control those trade routes which are relationship based. You know the two counterparties to trust on either end. 

And the point I was making about Sam Alman and Elon is if you really think what Elon's genius was, there's a few things he's amazing at. He's an incredible cult leader in technology. He always has been like the cult of Elon is strong. There are people who religiously believe in him for a whole bunch of reasons. That's very powerful. He's an incredible storyteller. It's just like he's incredibly good at attracting talent that will then do that. It's not like he's the engineer or all this stuff, right? But he's a great storyteller. 

But one of the most important things that Elon has been able to do over the last many years across multiple companies, like his real genius, is matching enormous amounts of capital with technology companies, right? Like that's what he does. That's what the marketing genius is. And he's kind of like the exclusive brokers of “I need 10 billion dollars”, right?. And there's an exhibit A for this which is I I forget which lawsuit or leak had his text messages but there are in the public domain text messages between Elon and Michael Grimes then at Morgan Stanley, now in the US government. Elon and  this one came up with Larry Ellison who's basically like “how much should I invest in X, a billion good?” 

There's a lot of VCs like myself included who if you want to ship a million a few million bucks like that's fine. There's like tons of that. That's not like an exclusive trade route if you need a few million bucks from LPS, right? You know, the biggest capitalists that are pure capitalists, what we call capitalists in the world, have gotten really good at moving way more money. They're like heavy shipping containers full of money. But if you really wanted to move enormous amounts of money, right, like from the physical world and from, you know, asset managers and technology companies, you kind of had to call Elon, right? 

And I think the animosity, if you think about who's been able to move money at scale from finance to tech at massive scale, it's Elon and now Sam, right? Sam is the other massive trade route person. And so I think the reality is who can move lots and lots of money from a finance zone into tech. 

You know I'd argue that for instance….. Palmer Luckey is getting good at this too right? Like there's a bunch of people who are becoming really good at shipping money around  to big tech. I'd argue that like for instance Josh Kushner is getting pretty good at this. But there's no one who can raise who can do it on the scale of Elon and Sam right now or at least demonstrating it. 

So I think that's actually the real point of threat or the reason that there's probably so much animosity is they're just too similar in what their core skill set is which is marketing and trade route, right? Capital trade route.  

I also just think it's like this is a model for how to think about lots of zones of power going forward. Like for instance, like I'm really bullish on the Tel Aviv Silicon Valley trade route, right? Think of them as trade routes versus just communities or cults or clubs or each of those things is its own community, right? Like they are their own communities. Like Tel Aviv is a community. Silicon Valley is a community. Again, in a free trade world, they all kind of intermingle. It's this globalized economy mental model, which is what we grew up with. I just think for lots of reasons, you're seeing a series of cults evolve across the world and it's just really valuable to be the translator or like the proxy between two cults that can't directly connect, right? 

And so I just think that's really what's happening in the world, you know, shrunk to a pin head and was super globalized for a period. We're now kind of regionalizing, then you think about trade routes, you think about who sits on those trade routes, who brokers them. It's a very powerful position to be. The most famous example in history that I love is Squanto. Squanto had the greatest gig in history, right? Which is Squanto who happened to be the one Indian who could both talk to the pilgrims and the Indians because he had somehow ended up in London or something. I don't remember the history exactly, but he spoke English and the local languages. And the whole thing, if you read like the early pilgrim experience, is they're all like, "We have no idea if Squanto is lying to us or not. We don't know. We have to trust him, but like is that what they actually said? Is Squanto doing all these deals on the side for himself?" 

But is this whole information asymmetry game connecting to disparate populations

that had to work together? Yeah, it was Squanto. So that's the most extreme version of that.”

So if you made it here, I think you get a better sense of how to operate and build power and wealth in the new multipolar world. A trade route is a good framework to see the world. Think trade routes and chokepoints. Similar to what control of Gibraltar, Singapore, Oman & Egypt were to the British Empire. Or how important advanced semiconductors, the Petrodollar and US Dollar itself is to the American Empire. All key chokepoints to control the world. 

In this new world, you have to build a personal brand, network and build connections. Become a connector between regions. Become a connector between companies. Become a connector between people. Become a connector and a translator, bring legibility to opportunities. This has always been the case but probably more so now in this new world we are entering.