“Exceptionalism” and the USD

 This update looks at US “Exceptionalism” and USD strength. The drivers of both are international equity flows as much as safe haven demand for US assets or central bank activity.. The investment conclusions are that a bear market in  US equities would have have negative implications for the USD current exchange rate as well as the USD as a  reserve currency, global equities and act as an offset to safe haven demand for US assets and the currency.