Sunday Start | What‘s Next in Global Macro: America, Frontier Market

Research evidence excerpt

Sunday Start | What‘s Next in Global Macro: America, Frontier Market

Global Idea

June 28, 2026 06:00 AM GMT

Morgan Stanley & Co. International plc+MSunday Start | What's Next in Global Macro Andrew Sheets

Strategist

America, Frontier Market Andrew.Sheets@morganstanley.com +44 20 7677-2905

If you were a global investor at the end of the eighteenth century looking for a

stable, low-risk home for your capital, it would have been entirely reasonable to

avoid the newly minted United States of America.

By the standards of modern finance, the young republic was not a developed market

in waiting. It was a frontier economy: volatile, debt-burdened, institutionally fragile,

resource-rich, politically combustible, and astonishingly unequal. Its currency had

collapsed, its public finances were suspect, its citizens resisted taxation, and its

growth prospects were extraordinary. In 1810, 70% of the country was under the

age of 25.

That is one of the revelations of Gordon Wood’s Empire of Liberty, which focuses on

early days of the new country (1789-1815). Wood’s America is not the marble

republic of statues and myth. It is speculative, messy, and full of motion. The United

States succeeded not by escaping the dysfunctions we associate with emerging or

frontier markets, but by turning them into a source of dynamism.

Start with capital. Early America needed it desperately. Roads, canals, land

purchases, and the government all required credit, and there was never enough of it.

The country was rich in land and poor in liquidity, a classic emerging-market

mismatch. And what the young country couldn't borrow or invent it

misappropriated, lifting intellectual property from its former masters in Britain.

What Alexander Hamilton understood was the importance of confidence given this