“Over the last 16 years, US stocks have gained 427% vs 85% for International stocks, and 36% for Emerging Markets. This is the longest cycle of US outperformance that we’ve ever seen.”
We’ve written frequently in previous QBs about how the US has significantly outperformed the rest of the world in terms of share market performance. The chart below captures this over the past 16 years, ever since the global financial crisis (GFC).

Source: Charlie Bilello
US equities can and perhaps will continue to post strong performance compared to their global counterparts and alternatives (bonds) over the next several years. Of course, there are significant risks:
- The wars in Ukraine and the Middle East.
- Elevated inflation.
- The pivot from extraordinarily loose monetary policy to tighter financial conditions.
- High global sovereign debt.
- Political uncertainty.
The next few years are likely to be challenging for the US and its developed market peers.
Despite these risks, the US remains better positioned to tackle these challenges than Europe, Japan or China. US households and corporations are entering this period in a position of financial strength as US household balance sheets are strong, and corporations have more cash on hand than at any point in over 20 years. The US has many of the most consistently profitable companies in the world.
Tighter financial conditions will create some headwinds, but a changing inflation paradigm also creates opportunities for investors. At a time when shares, like all financial assets, appear expensive relative to historical metrics, security selection will be a critical driver of investment returns. The US, with its global technology leadership, offers a superior reservoir for identifying these opportunities compared with other developed markets.
Disclaimer: Clime Asset Management Pty Limited | AFSL 221146 | ABN 72 098 420 770. The information provided in this post is intended for general use only. The information presented does not take into account the investment objectives, financial situation and advisory needs of any particular person, nor does the information provided constitute investment advice. Under no circumstances should investments be based solely on the information contained therein. Please consider the relevant disclosure document/s before investing in one of our products. Investment in securities and other financial products involves risk. An investment in a financial product may have the potential for capital growth and income
but may also carry the risk that the total return on the investment may be less than the amount contributed directly by the investor. Investors risk losing some or all of their capital invested. Past performance of financial products is not a reliable indicator of future performance or returns.