U.S. Exceptionalism: Nasdaq’s Triumph and the Global Market’s Sigh

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What to know:

  • U.S. exceptionalism is as alive as ever, with the Nasdaq and S&P 500 leading the global market charge since April. 🚀
  • Economic indicators, like real per capita GDP growth, bolster the case for U.S. exceptionalism. 📈
  • The resurgence of U.S. exceptionalism could be a boon for bitcoin and a stabilizer for the U.S. dollar. 💰

Amidst the cacophony of global financial markets, the notion of U.S. exceptionalism—a concept as old as the hills and as fresh as the morning dew—continues to thrive, much to the chagrin of its critics. The Nasdaq and S&P 500, those stalwart titans of American finance, have outpaced their global counterparts with a vigor that would make even the most stoic of economists crack a smile. 🌟

Since the early April downturn, the tech-heavy Nasdaq has soared by 31%, while the broader S&P 500 has rallied by 24%, according to data from the ever-reliable TradingView. Meanwhile, the rest of the world’s major indices, such as Germany’s DAX, France’s CAC, Japan’s Nikkei, and China’s Shanghai Composite, have been left in the dust, gasping for air. 🏃‍♂️💨

Both the Nasdaq and the S&P 500 reached record highs on Thursday, a testament to the enduring strength of the American economy. Demand for U.S. Treasury notes has remained robust, despite concerns about fiscal sustainability, as CoinDesk noted last month. 📜

Contrary to the popular narrative that capital is fleeing the U.S. en masse due to debt worries and President Trump’s trade wars, the data tells a different story. “Several key factors that underpinned U.S. exceptionalism remain fully intact and are perhaps even strengthening further,” wrote Hani Redha, portfolio manager and head of strategy and research for global multi-asset at PineBridge Investments, in a blog post last month. 📝

Redha pointed to deregulation under Trump as a crucial factor supporting the U.S.’s productivity supercycle, a phenomenon unique among global peers and a testament to American ingenuity. 🛠️

Economy validates U.S. exceptionalism

Other economic indicators, such as real per capita GDP growth, further support the exceptionalism narrative. This metric, which measures the rate at which the value of goods and services produced per person in an economy is adjusted for inflation, shows the U.S. outperforming the EU by a significant margin. “The reasons for this are deeply structural and haven’t changed one bit. U.S. exceptionalism—for growth at least—is here to stay,” Robin Brooks, senior fellow in the Global Economy and Development program at the Brookings Institution, said on X. 📊

The U.S. jobs data released on Thursday further reinforced the narrative of American exceptionalism, as Bruce J Clark, head of rates at Informa Global Markets, noted on LinkedIn. 📢

Implications for BTC and DXY

The return of U.S. exceptionalism to U.S. stocks is a positive omen for bitcoin and the broader crypto market, given the historical positive correlation between the two. BTC, the leading cryptocurrency by market value, has already surged 44% to $108,000, recovering swiftly from the early April lows of nearly $75,000, according to CoinDesk data. With a pro-crypto president in the White House, one might argue that bitcoin is now a part of the U.S. exceptionalism playbook. 🚀

Moreover, the resurgence of U.S. exceptionalism could provide a floor under the U.S. dollar. “With today’s jobs data putting another stake in the ‘loss of American exceptionalism’ narrative, the temptation to go long on dollars for a counter-trend trade is growing,” Clark noted, adding that ECB officials are increasingly uncomfortable with the strong euro. 📈

Early this week, the Financial Times reported that a senior ECB official suggested the central bank may need to signal that too much strengthening of the euro could be problematic, as it might push inflation below target levels. Meanwhile, ECB Vice President Luis de Guindos warned in an interview with Bloomberg that the euro should avoid “overshooting,” with levels above 1.20 being particularly troublesome. 🤔

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2025-07-05 21:19