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Over the past decade, U.S. stocks have been the center of the investing universe. And for good reason—the U.S. market remains one of the strongest and most influential in the world.
But wise investing is not simply about looking at where the market has been. It also means asking where opportunities may be emerging next. That raises an important question: Should investors consider looking beyond U.S. markets?
On today’s show, Mark Biller, Executive Editor and Senior Portfolio Manager at Sound Mind Investing, says the answer is worth careful consideration. While U.S. stocks remain important, global markets, currencies, and economic leadership are always changing. For investors seeking wise diversification, international investing may deserve a closer look.
Historically, one of the main reasons to own international stocks has been diversification. Decades ago, foreign markets often moved more independently from U.S. markets. When U.S. stocks struggle, international stocks might perform better, helping smooth out a portfolio's ups and downs.
That benefit has diminished somewhat as globalization has grown. Today, U.S. and foreign markets often move in the same general direction. But diversification is still not the only reason to consider investing abroad.
Another reason is opportunity. Many strong companies are based outside the United States. Investors who focus only on domestic markets may miss out on growth taking place in other parts of the world.
There is also a broader market-cycle consideration. U.S. and international stocks tend to trade leadership over long periods. One may outperform for a decade or more, and then the pattern can shift. After roughly 15 years of strong U.S. market leadership, foreign stocks may be positioned to become more competitive again.
The U.S. economy remains the largest and strongest in the world. America benefits from deep capital markets, natural resources, innovation, and relative political stability.
Still, Mark points out that U.S. financial assets have been “punching above their weight” for some time. U.S. stocks currently represent a much larger share of global stock markets than the U.S. represents of global economic output.
That does not mean U.S. stocks are destined to decline. But it does suggest that today’s level of dominance should not be assumed to last forever.
The global economy is shifting toward a more multipolar world, where economic leadership may be spread more broadly across regions. If foreign investors begin directing more capital toward their home markets, international stocks could benefit.
One of the most important distinctions investors should understand is the difference between global stock market share and global economic output.
According to Mark, U.S. stocks represent about 64% of the global equity market, while the U.S. share of global economic production is closer to 15%. That is a significant gap.
There is no rule that a nation’s stock market share must match its share of global economic activity. But those numbers have shifted over time, and there is no guarantee that the current U.S. share of global markets will remain this high indefinitely.
For investors, this means it may be wise to pay attention to where economic growth is happening outside the United States—especially in emerging markets.
Emerging markets can offer significant long-term growth potential. Thes
Throughout her broken childhood, podcaster Karen McAdams sensed she was missing something. But even after coming to know God, her sprint from shame kept her away from the heart of God. Along with her co-host Rachel Faulkner-Brown, Karen shares part of her own story that fueled the duo’s new study, Father’s House: The Path that Leads Home.
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Do you ever sit in your car with the engine running but haven’t yet put it in drive? You can pray for direction all day, but at some point, you’ve got to step on the gas. Pastor Greg Laurie says our Christian walk is like that. There’s a time to be still and trust, but there’s also a time to move. Maybe God is calling you to take action, just like He did with Nehemiah. Today on A NEW BEGINNING, good encouragement about stepping up and moving forward in our walk of faith.
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Military life can place enormous strain on families through deployments, frequent moves, and long seasons of separation. But what if those challenges could become opportunities for deeper faith and even ministry? Beth Runkle shares how military spouses can replace fear with faith, use prayer as a powerful spiritual weapon, and see every new assignment as part of God’s calling on their lives.
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How do you respond well if your child admits they're struggling with their gender identity? Dr. Jeff Myers and Dr. Kathy Koch talk with Jim Daly about some of the ways this is a prevalent issue in the world today. Plus, Danny will share some encouragement for if your child is struggling with their God-given identity.
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What are the biggest financial questions people ask? The money-related questions with which we grapple often reveal our fears, our hopes, and what we believe about God’s provision. On the next Faith & Finance Live, Rob West and Sharon Epps share the questions financial advisors hear most often. Explore how a biblical perspective can help us address them wisely. Then, it’s on to questions. That’s Faith & Finance Live—where biblical wisdom meets today’s financial decisions—weekdays at 4pm Eastern/3pm Central on Moody Radio.
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Topics:
Students of Jesus, Widow Mite, Breaking Animal News, Disciples, Welcome to the Show
BONUS CONTENT: Desperation, Information & Matter, Students of Jesus Follow-Up
Quotes:
"I believe everything is held together by God's word."
"Many people have a church affiliation but don't have a relationship with Christ."
"Everything Jesus told us is for our own good."
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