Diminished global US leadership – both de facto and de jure – is increasingly a given.
Green shoots – of the de jure variety – were evidenced as early as ’89 with the fall of the Berlin Wall.
By the end of Soviet times, US preeminence was unqualified. Until recently, most of the post-WWII period is characterized as unipolar or bipolar.*
Today, more players vie for global leadership. China and the European Union – for example - struggle for increasing influence over international policy.
With US intent to exit the Paris Accord, withdraw from the Iran Nuclear Agreement and leave the Trans-Pacific Partnership, it could be argued the US’s diminished roles is evermore de facto and increasingly acute.
Historically, global instability is the hallmark of a multipolar world. We are thinking quite a bit about how to position portfolios in light of this trend.
Weekly Update through May 11, 2018 The S&P 500 gained 2.49%, even as the Dow Jones added 2.51%. Both the Russell 2000 and the Nasdaq added 2.65%.
As for US bonds, they declined -1bps.
Globally, the MSCI World Index added 2.15% and the Barclays Global Aggregate Bond Index lost -3bps.
The Euro Stoxx 50 added 37bps in local-currency (Euro) and 58bps in USD. Meanwhile, the Topix rose 1.23% in local-currency (Yen) and 1.10% in USD.
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*Bipolar meaning two poles, in this case not "characterized by both manic and depressive episodes" although that too may be germaine.
