<\/p>\n
DoubleLine Capital CEO Jeffrey Gundlach says that the trend of American exceptionalism has come to an abrupt end.<\/p>\n
In a new CNBC interview, the billionaire \u201cBond King\u201d says that foreign investors have been happily investing in US assets over the last two decades, leading to massive capital inflows to the tune of tens of trillions of dollars.<\/p>\n
But now, Gundlach says he\u2019s seeing signs that foreign investors are yanking capital out of US markets in favor of the euro and European equities. According to the hedge fund chief executive, the reversal in flows tells him that investors are now crowning a new market leader.<\/p>\n
\u201cForeigners have been very willing \u2013 downright enthusiastic, almost euphoric \u2013 about buying dollar assets over the past 18 years or so. Over $25 trillion has been invested in US financial markets, more than the US has invested in foreign markets.\u00a0<\/em><\/p>\n That\u2019s a massive increase. It went from $3 trillion to $28 trillion by one measure. That may be reversing, and this is part of the underpinning for why I think that the trend of US outperformance is over. And I mean over for real\u2026<\/em><\/p>\n I\u2019ve been recommending Europe in European currency for dollar-based investors. The [European] index has outperformed the US index by a decent amount, but if you had the currency side of it, if you own it in euros and you get the currency translation, you are just printing money right now.\u00a0<\/em><\/p>\n And that trade, I believe, is just getting started.\u201d<\/em><\/p>\n