The United States is well-positioned to weather the current slowdown of global economic activity. It is expected that the ratio of American dependents to working people will remain more favourable than in many other countries. This relative demographic advantage may give the country a competitive edge in supporting higher than average economic growth.
The U.S. has one of the highest rates of investment in innovation and proportion of workers involved in research and development. A component of their innovation strategy is reducing dependence on foreign energy. This could establish future energy supply security in the U.S. It is hard to predict the next big wave of major innovations that could boost productivity, but the U.S. stands to benefit from them when they occur.
The United States enjoys a preeminent geopolitical position unrivaled by other countries. It continues to attract strong foreign direct investment due to its relative protection for capital owners, respect of property rights, commitment to business investment and promotion of deep capital markets. The U.S. dollar has also been the dominant global reserve currency for most of the past century. It is expected to retain this status for decades to come.
The resilience of the United States offers attractive investment opportunities for the Canadian investor who is looking for potential sources of diversification and long-term capital appreciation. We believe American equity and fixed income investments should be considered as a core component of an investor’s internationally diversified portfolio.
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