America’s economic and stock market dominance will continue in 2025.
This is stated by two of Wall Street banks, which said this month that investors continue to bet on the United States.
The United States represents “the largest and most diversified economy, avant -garde and resistant in the world,” said Goldman Sachs’s wealth control organization in his perspective note in 2025.
To illustrate this domain, Goldman said that the US nominal GDP. He approached $ 30 billion in 2024, almost twice the duration of the Eurozone economy. Meanwhile, the inventory and bond market of the United States have a value of $ 79 billion, 8 times larger than the next largest country, Japan.
With numbers so large, it’s natural for investors to question if US dominance has peaked and whether they should reallocate their investment portfolios to international stocks and bonds.
The answer is a resounding no, according to both Goldman and JPMorgan.
Goldman Sachs stressed the forces that continue to underline American exceptionalism, adding their cultural tenacity for the taking of threats and business spirit, its geographical benefits of having oceans on two sides of the country and giant natural resources and its formula of “good governance” that It is characterized by a physically powerful formula of controls and counterweights.
“These points have argued that our strategic suppression of US assets and our tactical view of remaining invested in US stocks actually shift our assets to non-US stocks or liquidity,” Goldman Sachs said.
The United States widened the gap between peer economies back in 2024 by developing its GDP by 1. 4 trillion dollars. That’s 50% and 126% more than the GDP expansion of China and the eurozone last year, respectively.
“Given this gap in development, even China will catch up to the GDP of the United States,” Goldman Sachs said.
Goldman Sachs recommends investors increase their allocation to US stocks. The bank had previously recommended a 74% weight to the asset class, but bumped that exposure to 79%, representing a 12 percentage point overweight relative to the MSCI All Country World Index.
JPMorgan echoed those sentiments in a recent note, highlighting the more sensible investment themes it sees for 2025 and beyond, adding that the narrative of American exceptionalism will get a boost with the second Trump administration.
What drives JPMorgan’s multiplicity is the fact that the United States is the only economy in the world that has returned to its forward-looking form of pre-national expansion.
“US real GDP currently stands nearly 4%-pts above its pre-pandemic potential path, while the RoW maintains a greater than 1%-pt negative gap,” JPMorgan said, adding that China’s underperformance has been the most severe.
The strong growth has been driven by a “newfound business dynamism” that was kickstarted by the COVID-19 pandemic, JPMorgan said. The bank highlighted that changes to work patterns, like remote work, and a boom in new business formations have been a boon for sustained economic expansion.
The bank expects the continuation of the Federal Reserve and an Benign Unemployment Rate to drive the US economy in 2025.
Finally, the EE. UU. Se client has stood out as a driving force of the economy for global peers.
“U. S. customer spending is excessive relative to the rest of the world,” the bank said. “The behavioral optimism reflected in a decline in U. S. household savings rates stands in stark contrast to the caution seen in emerging European economies, even though the U. S. and EMU have the highest household debt ratios. “