Kathrine Frich
The Eurozone is benefiting from massive infrastructure and defense spending,
The Eurozone is benefiting from massive infrastructure and defense spending,
Investors Are Running From the U.S.
Wall Street is losing its grip. Trade wars, soaring national debt, and a volatile White House have shaken global confidence in American assets.
Big money managers are quietly scaling back U.S. investments and looking toward Europe instead.
Trump’s Trade War Sends Shockwaves
It started with tariffs. Donald Trump’s aggressive trade moves, especially the sweeping duties on international partners, sent markets into panic.
One senior private equity executive even dubbed the moment “Trump’s Liberation Day” when investors realized just how exposed they were to American risk.
Debt Bomb Looms Over Washington
Trump’s tax reform may have excited his base, but it came with a $2.4 trillion price tag. That massive debt load is now raising red flags for global investors.
Seth Bernstein of AllianceBernstein warned, “U.S. borrowing is becoming unsustainable.”
The Dollar Takes a Hit
Once a safe haven, the U.S. dollar is now teetering. It’s down 9% this year and hovering near a three-year low.
Even after Trump walked back some tariffs, the damage was done. Wall Street’s recovery? Still lagging behind Europe.
Europe Looks More Attractive Than Ever
While America stumbles, Europe rises.
The Eurozone is benefiting from massive infrastructure and defense spending, Germany alone is pumping €1 trillion into the economy.
Stability, for now, is Europe’s biggest selling point.
Canada Joins the Shift
It’s not just European investors hedging their bets.
Canada’s second-largest pension fund has slashed its U.S. exposure, redirecting capital to the UK, Germany, and France.
It’s a signal: North America’s own institutions are voting with their wallets.
Wall Street Trails Behind
Despite some market rebounds, the numbers tell the story.
The S&P 500 is up less than 2% this year. Europe’s Stoxx 600? A solid 9% gain.
U.S. stocks just aren’t keeping up and investors are noticing.
Even American Giants Are Fleeing
Blackstone and Neuberger Berman are among the U.S. firms tilting their portfolios overseas.
Neuberger’s private equity investments in Europe have more than doubled this year. Their rationale? “More stability, less drama.”
But Is Europe Really the Answer?
Not everyone’s convinced. Some argue Europe’s fragmented markets, slow growth, and heavy regulation make it a tough sell. China, too, remains unpredictable.
“Where else can you place huge amounts of capital?” asks Howard Marks of Oaktree.