Economic Venture in American Securities Continues to Be a Profitable Decision
In the world of global finance, the United States has established itself as a dominant force, with its stock market outperforming many international markets for several decades. Here's a closer look at the key trends and factors that have contributed to this dominance.
## U.S. Market Performance and Dominance
Historically, U.S. stocks have outperformed international stocks for most of the past few decades, particularly after the Great Recession. This trend was evident until 2022, with U.S. stocks outperforming international stocks for all but a few years over the previous 33 years.
In the post-pandemic period, from 2022 until early 2025, the U.S. market experienced significant growth, with the S&P 500 and Nasdaq reaching all-time highs in early July 2025. However, in the first half of 2025, international stocks, particularly in Europe, led gains due to expansionary fiscal policies and monetary easing.
The U.S.'s economic growth has consistently outpaced many developed markets, contributing to U.S. equity outperformance in 12 of the past 15 years since 2010. Despite expectations of a narrowing gap in real GDP growth between the U.S. and other regions like the eurozone in 2025, U.S. corporate profits are anticipated to continue outpacing those of international peers.
The U.S. market's resilience is partly attributed to its strong corporate sector and the impact of technologies like AI, which are expected to bolster U.S. earnings growth. Additionally, policy shifts and monetary conditions have played a significant role in shaping market performance.
## Current and Future Outlook
The U.S. market is expected to maintain its strength in 2025, with U.S. corporate strength and easing supply constraints being key scenarios for the year. Despite international stocks showing temporary gains, the U.S. market is projected to continue its dominance due to robust corporate earnings and supportive policy environments.
While the U.S. market has historically outperformed, some argue that diversification into international markets might be less effective due to this consistent outperformance, leading to the concept of "deworsification." However, this perspective is debated, as diversification can still provide risk management benefits.
In summary, the U.S. stock market has shown remarkable growth and dominance over the past few decades, with some fluctuations in recent years. Factors such as technological advancements, corporate strength, and policy support continue to contribute to its resilience and outperformance compared to global markets.
Notably, the U.S. leads the world in diverse activities such as aerospace, agriculture, finance, energy, technology, healthcare, education, and entertainment. Microsoft, Nvidia, and Apple have market values that overshadow the entire economies of most other nations, with Microsoft at $3.6 trillion; Nvidia, $3.5 trillion; and Apple, $3.0 trillion.
As of 2025, the MSCI All-Country World Index (excluding American stocks) has increased by 16%, while the S&P 500 has increased by just under 6%. Despite this, the U.S. remains a top choice for investors, with Joseph Quinlan, head of CIO market strategy for Merrill and Bank of America Private Bank, suggesting that the U.S. stock market is similar to sports teams' dynasties, with long spells of dominance.
However, Quinlan also notes that great teams (economies) don't win every year, and there may come a time when the rest of the world outgrows the U.S. Nevertheless, the U.S. continues to stand as a formidable force in the global financial market.
Personal-finance-focused investors may find it advantageous to consider the U.S. market for investment opportunities, given its historical and anticipated outperformance over many international markets. Moreover, the resilience and dominance of the U.S. market can partly be attributed to its strong corporate sector, particularly tech giants like Microsoft, Nvidia, and Apple, which together overshadow the economies of most other nations.
