American Exceptionalism: Why Wall Street Outperforms All Other Markets

In a book published in 2002, “Triumph of the Optimists: 101 Years of Global Investment Returns,” three British professors at the London Business School came to two major conclusions:

First, in all 16 countries (primarily in Europe and North America) in their survey, stocks outperformed bonds and gold over the long term and enjoyed a long-term upward tre wars, the Great Depression, runaway inflation, currency crises and other unstable conditions.

Second, U.S. stocks outperformed the rest of the world on a long-term basis.

hart below.

World stock markets 1900-2000. Source: “Triumph of the Optimists” (2002)

Since the start of the new millennium, nothing has changed. The U.S. stock market continues to outperform the rest of the world.

Last month, the Brookings Institution just released a blockbuster report on the global economy and markets, concluding, “In dollar terms, U.S. stock market performance leaves all other countries in the dust.” Indeed, Wall Street has outperformed EVERYTHING this year except oil and marijuana stocks.

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