https://lizpeek.com/daily-rant/dont-bet-against-america-why-u-s-growth-still-beats-europe-and-china/?utm_source=newsletter.lizpeek.com&utm_
The big investment (and political) story of late suggests that the U.S. has lost its way, all because of President Trump. The administration’s “chaotic” trade policies and the U.S. fiscal picture, pundits tell us, are driving investors to send money elsewhere. American exceptionalism, we are told, is on the way out.
The Economist, for instance, posits that the U.S. is falling behind in the global race. But – spoiler alert – they’re struggling to win the argument.
Case in point: recently one of their writers, Stanley Pignal, head of the magazine’s Brussels bureau, wrote an amusing piece about Europe titled “The Unbearable Self-Indulgence of Europe.”
He sums up the European mindset thus: “The world is going to hell, meaningful economic growth is a long-forgotten phenomenon, and by the way what are your plans for summer?” What does Pignal think should keep Europeans up at night? War, of course, and Trump (he may be a realist but he’s still works for the Economist) and also, “its big companies are also-rans and the continent’s population is shrinking for the first time since the plague seven centuries ago.”
In short, “Europeans know the global race for economic supremacy is lost.” Why? Because “the continent’s business model endures: it is a third poorer than America, works a third less, and is a lot more tanned at the end of August.”
Meanwhile, last Friday cousin publication the Financial Times sounded the alarm: “Big investors lose faith in American exceptionalism,” saying concerns about US deficits and trade policies have caused a “sell-off in the dollar and left Wall Street stocks lagging behind European rivals”. The author points out that after 15 years of outperformance that has driven US markets higher, big investors have been shifting funds overseas. Why? Partly because Germany has decided to spend a boatload of money on infrastructure and defense.