Why Is The US More Exuberant Than China?

China has accomplished a great deal over the past few decades, transforming from a poor, insular, and rural economy to the world's second-largest economy. Its transformation has been hailed as an economic miracle. Yet this miracle hasn't been reflected in China's stock market. The China MSCI stock price index has been flatlining since the end of the Great Financial Crisis (GFC) in 2010. Over this same period, the US MSCI has increased sevenfold (chart)!

The same underperformance is visible in the Invesco China Technology ETF (CQQQ), which has been flat since the GFC (chart). Over the same period, Invesco's QQQ ETF--which tracks 100 of the largest US domestic and international non-financial companies listed on the Nasdaq Stock Market based on market capitalization--is up seventeenfold!