The American exceptionalism, the notion that the US economy and its financial markets are different compared to other nations remains alive and good, at least in the stock markets.
Since early April-Dias, Wall Street’s tech-tongue Nasdaq index has risen 31%, while the wider S&P 500 index has collected 24%, according to data source trading. Other major indexes, such as Germany’s DAX, France’s CAC, Japan’s Nikkei and China’s Shanghai composite, have been halved behind Wall Street.
Both Nasdaq and S&P 500 traded with record highs on Thursday. The demand for the US Ministry of Finance has remained in the midst of concerns about fiscal sustainability, as noted by Coindesk last month.
The data contradicts the popular tale that capital streams are rebalancing away from the United States in a lot due to debt junks and President Donald Trump’s trade war and repeated criticism of the Federal Reserve.
“More key factors supporting the US exceptionalism remain fully intact and maybe even strengthening further,” wrote Hani Redha, portfolio manager, head of strategy and research for globally multi-active at Pinebridge Investments, in a blog post published last month.
Redha pointed to deregulation under Trump as a key factor that supports the US productivity supercycle – unique among global comrades – and its lead globally.
Economy validates the US exceptionalism
Other economic variables, such as the real growth of GDP growth in the inhabitants, also support the unusual narrative. The metric measures the speed at which the value of goods and services produced per day. Person in an economy is adjusted for inflation.
“The United States exceeds massive EU with regard to real GDP growth per capita.
The US Job Data, released on Thursday, added another share in the ‘Loss of American Exceptionalism narrative, such as Bruce J Clark, the head of the Informa Global Markets, said on LinkedIn.
Implications for BTC and DXY
The return of US exceptionalism to US stocks can be seen as a positive development for Bitcoin
And the wider crypto market in view of the historical positive connection between the two.
BTC, the leading cryptocurrency with market value, has already risen 44% to $ 108,000, which is quickly gathered from early April of nearly $ 75,000, according to Coindesk data. Furthermore, with the pro-crypto president of the White House, one can claim that Bitcoin is part of American exceptionalism.
Meanwhile, the return of American exceptionalism could also put a floor under the US dollar. “With today’s job data that puts another share in the narrative ‘Loss of American exceptionalism’, the temptation to get long dollars here for a counter-trading trading is big and growing,” noted Clark, adding the ECB officials’ growing discomfort with the strong euro.
Early this week, the FT reported and quoted a senior ECB official that the central bank may have to signal that too much strengthening in the euro could be a question as it could lead to inflation hovering under target. In an interview with Bloomberg, ECB Vice President Luis de Guindos meanwhile said that “excess” of the euro should be avoided, marked levels above 1.20 as complicated.
