In the last 50 years, the participation of the United States in the World GDP fell from more than 38% to around 26%, measured in current dollars. Together with this trend, today the world observes the impact of Trump and many wonder if we are facing the end of the US hegemony to answer this question, it is crucial to analyze the alternatives and understand that, in the current context, The strength of countries depends critically on their companies and capital markets that enhance them. Therefore, when evaluating the possible loss of hegemony of the United States, two questions will have to be answered: are the mastery of the United States global giants -as Alphabet, Amazon, Apple, Meta or Nvidia– Threatened by the measures promoted Trump? Will your capital market lose relevance as a driver of world savings towards those companies and to US debt?
If we talk about companies, the United States has been the undisputed leader, by housing some of the most powerful in the world, many of them quoting in Nasdaq. They are known as “Tech” and appear on this Glast Gigant List such as Alphabet (Google), Amazon, Apple, Meta (including Facebook and Instagram) or Nvidia. Together with China, they are the only countries with a comparable business development level. Europe is behind and its companies are losing relative importance in alarming way and, although India grows, it is still far from having companies that reach that importance.
Moreover, although The only companies that could compete with the Americans are the Chinese, Where we see giants such as Alibaba or Byd, the intervention of the Communist Party in the private sector a few years ago in the face of the growth of the power of these companies generates doubts about their true potential. We can remember the scandal around the persecution of the creator of Alibaba, Jack Ma, and his necessary refuge in Japan against his criticisms of the party. Therefore, at the moment and seen In business terms, USA would still not have competition And, although Trump imposes tariffs, it does not seem that this will change too much about global giants in the short and medium term.
The analysis can change something from the perspective of the capital market. Historically, the United States has been the final refuge for investors and its interest rate is considered risk -free rate. And, although the dollar has lost peso as an international trade currency, it remains the dominant means for this purpose. On the other hand, United States companies have been the most sought after by long -term institutional investors.
However, before Trump’s tariff movements and attacks on the Federal Reserve, today they arise about their independence and some speculate that The dollar could cease to be that shelter Sure, what would be a much more serious blow for the global financial system. In fact, capital rotation has been seen from US companies to funds that do not include companies in the United States. But that rotation could be short -term and there seems to be no investments clearly alternatives to those of the United States. Will capitals go to bonds or companies in Europe? Difficult. Asia? Even more difficult. This is: damage to the capital market of the United States would be limited by the absence of clear investment alternatives and the robustness of their companies.
The conclusion seems that, despite the chaos that Trump can generate, he would not have the ability to dismantle the United States and that virtuous circle between global giants and capital market. The greatest damage that could cause in the short term would be a recession and affect something the country’s reputation In the long term, but I don’t think that is enough to unseat the US as the first world power. While continuing to lead in innovation, generating global giants that attract capital and holding strong institutions, US leadership still seems very firm.
*Roberto Vassolo is a professor of company policy at IAE Business School.
By Roberto Vassolo
