Part 4/9:
Using the United States as a case study, real GDP growth was reported at around 10% in the last five years. However, factoring in an approximate 21% inflation rate reveals that the economy's actual growth rate is about 31%. The correlation of nominal values to perceived growth needs to be understood to grasp the blatant disparities between stock market growth and economic performance.
The U.S. Market and Striking Divergences
As of today, U.S. markets constitute approximately 65% of the global accessible stock market. Within this domain, the U.S. stock market has compounded at an impressive rate of 13.23% annually since 2010, significantly outpacing GDP growth, which averaged just over 2% during the same timeframe.
Three key trends enable this accelerated growth: