Visit the Institute
Investment Institute
An investment-led platform for insights, partnership and research.
Beyond the one-way trade: rethinking US exceptionalism for a new cycle
Since the global financial crisis, allocating to US assets has been the easy trade justified by technology dominance, deep capital markets, structural advantages and institutional stability. But as 2025 unfolds, that consensus is being tested.
Tariffs are triggering structural shifts in the US economy and rewriting global trade rules. A deteriorating fiscal position – marked by persistent deficits, rising debt costs and policy unpredictability – is weighing on sentiment and capital flows. A more transactional style of politics is reconfiguring US foreign policy and unsettling alliances. All this comes at a time when the dollar looks overvalued and US equities are expensive by global standards.
This collection of research and content explores what happens when allocators start looking elsewhere – not because the US is collapsing, but because right tail risks are rising globally, while left tail risks are rising in the US. Europe is delivering a more coordinated fiscal impulse, Japan is emerging from stagnation, and emerging markets, including China, are showing technology leadership and resilience.
If the age of the unquestioned American overweight is behind us, the implications are profound.