Is American Market Dominance Over?

Andrew Sheets, Head of Corporate Credit Research at Morgan Stanley, interviews Lisa Shalett, Chief Investment Officer for Morgan Stanley Wealth Management, about her report "American Exceptionalism, Navigating the Great Rebalancing." They discuss the long-term outperformance of the U.S. economy and markets, attributing it to factors like innovation, strong capital markets, and globalization. Shalett argues that this exceptional performance, fueled by monetary and fiscal policies, is unsustainable due to global rebalancing and deglobalization. The conversation explores the implications of these shifts for U.S. corporate margins, global supply chains, and economic inequality, suggesting a moderation rather than an end to American exceptionalism. The podcast is the first of two parts, with the second part to focus on fixed income markets.