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This is the ‘special sauce’ behind American exceptionalism—and why the U.S. stock market could continue dominating

This is the ‘special sauce’ behind American exceptionalism—and why the U.S. stock market could continue dominating
“Many countries have these various advantages, but none have the combination—or the entire package—quite like the U.S. does,” RiverFront Investment Group’s chief strategist said.

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The term "American exceptionalism" has taken on a new meaning in financial circles since the end of the Global Financial Crisis. Economists, analysts, and investors now use it to refer to the relative outperformance of the U.S. economy and stock market compared to its developed peers, particularly in the wake of the pandemic. U.S. GDP per capita has surged compared to its developed peers over the past decade, and U.S. stocks have outperformed those in Japan and Europe since 2009. Experts attribute this outperformance to long-term strengths such as labor market flexibility, demographics, and a culture of innovation, as well as short-term factors like fiscal and monetary stimulus, energy independence, and corporate tax competitiveness. While some experts believe that American exceptionalism is here to stay, others caution that it may be a result of temporary factors like high levels of spending.

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