Money leaving US stocks
- Investors appear to be rotating capital from richly valued U.S. stocks into Japan, Europe, and emerging markets. - The thread cited market multiples: S&P 500 around 22x earnings, Europe about 14x, and emerging markets near 12x. - The poster tied the shift to Buffett's Japan purchases and his roughly $350 billion cash position as a signal for reallocations (x.com).
Global investors are shifting money out of U.S. stocks and toward Japan, Europe, and emerging markets as the valuation gap widens. (macromicro.me) (msci.com) (siblisresearch.com) As of April 21, 2026, the S&P 500 traded at a forward price-to-earnings ratio of 20.82, according to MacroMicro data sourced from S&P Dow Jones Indices. MSCI put Europe at 14.38 times forward earnings as of March 31, 2026, while Siblis Research showed the MSCI Emerging Markets Index at 13.44 times forward earnings on January 1, 2026. (macromicro.me) (msci.com) (siblisresearch.com) Flow data points the same way. Morningstar said U.S. equity funds had been losing assets for nine straight months through January 2026, while international-equity funds posted their strongest inflows in years. (morningstar.com) That shift follows a long run in which U.S. stocks dominated global benchmarks, led by large technology companies and enthusiasm around artificial intelligence. Higher prices left the United States trading at a premium to most overseas markets by early 2026. (macromicro.me) (msci.com) (yardeni.com) Japan has become a focal point in that rotation. Berkshire Hathaway raised its stakes in Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo to roughly 8.5% to 9.8% each, according to a March 17, 2025 regulatory filing reported by CNBC. (cnbc.com) Buffett’s Japan bet stands out because Berkshire was also cutting U.S. equity exposure. CNBC reported that Berkshire sold more than $134 billion of stocks in 2024, largely trimming Apple and Bank of America, while its cash pile reached $334 billion at the end of that year. (cnbc.com) By early 2026, Berkshire’s cash and Treasury-bill holdings had climbed further, with reports putting the total near $373 billion. Buffett told CNBC in March that cash is necessary “like oxygen,” even if it is “not a good asset” over long periods. (ibtimes.com.au) (cnbc.com) Not everyone reads those moves as a call to abandon U.S. stocks. Berkshire’s filings show Buffett has kept most of the company’s equity portfolio concentrated in the United States even while adding to Japan, and Morningstar’s January data still showed strong overall inflows into long-term U.S. funds, driven mostly by bonds. (berkshirehathaway.com) (morningstar.com) The immediate question is whether cheaper overseas markets can keep attracting money if U.S. earnings growth slows or if the dollar weakens. For now, the numbers show investors paying about 6 to 7 fewer turns of earnings for Europe and emerging markets than for the S&P 500. (macromicro.me) (msci.com) (siblisresearch.com)
