China's economy is slowing, and trade war may make it worse. Currency crises in Turkey and Argentina are spilling over to other emerging markets. Italy looks shaky. And the UK economy is unsettled as the last Brexit deadline draws near.
Yet the US economy and stock market continue to power ahead.
America's gross domestic product rose at an annualized pace of 4.2% in the second quarter. The Atlanta Federal Reserve is forecasting another impressive jump of 3.8% for the third quarter. The US unemployment rate is at its lowest point in nearly two decades and wages are rising. Consumers are spending at a healthy clip. The manufacturing sector is booming even as tariff fears grow. Small businesses are more optimistic than ever. Inflation remains mild.
That clean bill of health helped lift American stocks. After a brief rough patch, the Dow, S&P 500 and Nasdaq are once again inching closer to the record highs they set earlier this year.
Iconic American multinational companies like Apple, Boeing, Microsoft and Nike have all surged in 2018 thanks to strong sales and profits both in the US and abroad.
How much longer can the dichotomy last?
US could lift world higher
The US economy and stocks can't thrive for the long haul while other major economies remain weak. Decoupling is a myth. If the rest of the globe is coughing, the US eventually is going to catch a cold.
But maybe this time really is different?
Jim Tierney, chief investment officer of Concentrated U.S. Growth at AllianceBernstein told CNNMoney that earnings should remain strong for American companies this year and through 2019. He noted that stocks aren't as expensive as they once were either since profits continue to grow at a healthy clip.
Barbara Reinhard, head of asset allocation for Voya Investment Management, thinks that strong US fundamentals will be good for the rest of the world too. She wrote in a report this week that "U.S. economic growth continues to drive global expansion."
Jeffrey Pavlik, chief investment officer of Pavlik Capital Management, also is bullish on the United States.
Pavlik said in an interview with CNNMoney that he's not overly concerned about the Federal Reserve causing a premature end to the party with more rate hikes either.
Don't sweat more rate hikes or trade war fears
Pavlik said he thinks Powell realizes that rate hikes are one reason why the dollar has surged so dramatically lately -- and that this is hurting emerging markets since their debt is often denominated in US dollars.
As such, Pavlik believes the Fed may raise rates two more times this year and perhaps one more time in early 2019 and that it is likely to pause after that.
"We would need truly exceptional economic numbers to get the Fed to raise rates more aggressively," Pavlik said. "I don't think Powell is going to whiff here."
What about trade wars though?
Reinhard noted there are increased expectations that trade tensions between the US and China (and the rest of the world) may de-escalate. Headlines about the possibility of more negotiations have renewed hopes that cooler heads eventually will prevail.
If that happens, the greenback's relentless surge against many other currencies could start to abate.
In other words, a healthy US economy may lead the rest of the world out of its collective funk.