Is there an argument that other economies would recover better than the US, in the long term? But at that point, one could just diversify during/after the crash.
YTD, US equities have underperformed most other equity indexes.
The argument is that a weakened dollar, political / economic unpredictability, politicization of the fed, and big spending bills are starting to weigh on investors’ minds.
Personally, I don’t think a dramatic “crash” is the most likely outcome. I think it would look more like a slow erosion of US growth and dominance compared with other economies.
https://www.bloomberg.com/news/articles/2025-10-11/a-great-y...
Your comment lines up with my sentiment, though I don't put a ton of stock (pun somewhat intended) in mine due to "amateur" status.
But I guess the "if not US, where?" question remains for me. Diversity "everywhere", try to be smartly selective?
So telling you what I hold: I’m long the market, mostly in US equities (60%), developed economy international equities 20%), and intermediate term US bonds (20%).
My investment horizon is 20+ years, so in general, I don’t pay attention to the short term vol.
I have cash I need to invest. I'm not looking to change any of my existing investments, so it's more a question of what the right move is there, with the wrinkle that I now live in the EU (again) after spending my whole adult life in the USA.
I don't believe (or have interest) in making any short term moves. I don't think I need to (and feel very fortunate).
We have the same 20+ horizon, but I guess the crux of the issue (and the point of my initial entry into this thread) is: how different do I think the world will be in 20+ years, and even if I'm confident it'll change, do I know what it'll become to make the right moves now?
I don't think I do (and I'm somewhat skeptic anyone else really does either).
There's lots of crashes, but they're over-predicted. A quote I can't remember perfectly, "we predicted 10 of the last 3 stock market crashes".
That said, if the levers of power in the USA stop being independent, if they all become bound to the will of the President, there's a strong risk of someone — could be the President who ends their independence, could be a successor — crashing it all very hard. If whoever is in charge at the time hates intellectuals, I mean it can be Pol Pot hard; but even if the leader at that point tries to do it all right and listens to sane advisors, it can still crash as hard as the Chinese famine resulting from the Four Pests campaign.
The USA isn't there yet. That's the direction of motion, but even with the current speed of change, there's enough independence that it's not even close to that bad yet.
I hope we never get there.
Take a look at Dubai, for instance.
And at least arguably, the causality goes the other way: restless populations in poorer nations are more likely to drive democratic reforms, where wealthy folks tend not to rock the boat.
My question in the second paragraph was definitely not rhetorical. :)
I diversified away from the US to international equities VTI -> VSUX starting at the beginning of the year. My thesis is that trade is rearranging due to US trade policy. If you look at the S&P500, growth has been flat since 2022 for anything that isn't Big Tech AI bubble. Therefore, I believe that between go forward US economic policy and global trade reconfiguration, non US will outperform the US over the next five years.
With that said, the biggest US companies are pretty exposed internationally already. I'm not sure someone needs to or it would be prudent to say dump VOO and move to VXUS 100%.
It's the reverse for EU investors, where you have to now accept pretty big currency risks to ride the A.I train (If you add in the EUR/USD rally I think you're flat to negative on your SP500 as an EU investor for example).