Why 'Sell America' Is Becoming the Catchphrase of Wall Street

A New Investment Mindset

At the onset of 2026, a significant shift has emerged in global investment strategies: the trend dubbed 'Sell America.' This new approach signifies a growing unease among investors regarding the U.S. economic landscape, as concerns about political stability and fluctuating monetary policies take center stage.

This sentiment has not developed in a vacuum. It first gained traction after severe tariffs rattled markets last April, but its impact has intensified in recent weeks. Assertions from the Trump administration attacking the Federal Reserve's independence and threatening a renewal of trade wars with Europe have only intensified fears among investors.

Lauren Goodwin, an economist at New York Life Investments, noted that even her European counterparts are surprised by the extent to which U.S. investors are exploring diversification away from domestic investments.

Hedging and Diversification

Interestingly, this trend doesn't entirely denote a wholesale abandonment of the U.S. market. Instead, experts argue that the 'Sell America' trade marks a strategic hedging—investors are diversifying to mitigate risks associated with their existing U.S. exposure while carefully deciding where to allocate new funds.

Such strategies have had tangible economic effects, including a weakening dollar, stagnation in stock market gains, escalating government borrowing costs, and soaring prices for safe-haven assets like gold.

The Dollar's Decline

Recently, the dollar fell by 1.2 percent in January, marking its second consecutive week of losses against a basket of major currencies. Over the past year, it has plummeted approximately 10 percent—an alarming trajectory for a currency typically deemed a bastion of strength.

Simultaneously, precious metals like gold and silver have seen impressive climbs: gold is up 75 percent year-over-year, with January revealing a 24 percent increase alone. Such trends signal a retreat to safer investments that many are turning to as geopolitical uncertainties rise.

The Shift in Investment Strategies

Adam Turnquist, chief technical strategist at LPL Financial, termed this a 'paradigm shift' for the dollar, particularly acute for international investors. “U.S. equities thrived when the dollar was strong,” he remarked. “That link, however, is unraveling.”

Moreover, the Trump administration has attempted to spin the dollar's depreciation as a means of making American products more competitive globally. Such proclamations have unsettled investors who have become accustomed to past policies supporting currency strength.

Concerns Over U.S. Market Stability

Underlying these monetary trends are stark concerns regarding U.S. market safety: geopolitical strife, threats to the Federal Reserve's autonomy, and ballooning governmental debt have left investors anxious. Erratic policymaking patterns only exacerbate these worries.

Goodwin expressed the frustration shared among many investors, stating, “Key aspects of this administration's economic agenda conflict with each other.”

The Future of U.S. Investments

Despite the prevailing worries, many investors still acknowledge the fundamental resilience of the U.S. economy, historically a beacon of growth. The enormity of the American markets renders them unrivaled in ease of transaction and liquidity. However, ongoing concerns about governance and policy directions might alter the financial complexion of future investments.

With the U.S. stock market composition skewed towards American assets—about 70 percent of the MSCI All World Index—global investors have become increasingly reliant on American equities. Ironically, this reliance makes them vulnerable to the perceived volatility of the U.S. market.

Gold as a Safe Haven

The declining dollar is impacting foreign investment returns as well, making non-U.S. equities more appealing as investors look to allocate capital abroad. Notably, in dollar terms, the Stoxx 600 has risen nearly 30 percent over the last year, significantly outpacing the performance of the S&P 500. This shift echoes broader concerns over political security and economic viability.

Conclusion

The 'Sell America' narrative indicates a profound recalibration within the investment community, driven by factors that extend beyond immediate market performance. As investors reassess their commitments to U.S. assets in light of geopolitical upheaval and financial unpredictability, the broader implications for the dollar and American investments could redefine the global economic landscape.