Celebrating America's Declaration of Independence and The Wealth of Nations at 250 Years: A Lowcountry View of Capitalism, Deviations from Efficient Markets, and the Future of Global Forecasting of Earnings

John B. Guerard, Jr. () and Juan Chen ()

No 2026-003, Working Papers from The George Washington University, The Center for Economic Research

Abstract: It is well known that America is celebrating its 250th birthday. The United States of America began with Mr. Jefferson writing its Declaration of Independence, in which the 13 colonies agreed to break away from England, their mother country, which was signed July 4th, 1776, in Philadelphia. The American Revolutionary War was fought to ensure the colonies’ independence, and won on the battlefield at Yorktown, Virginia. Independence was formally recognized with The Treaty of Paris in 1783. It is our contention that the many of the colonial leaders that signed the Declaration of Independence were successful merchants who had created an economic system in Europe that was brought to the Colonies, as reported in Adam Smith's The Wealth of Nations (1776) and enhanced by the colonists, acting in their own interest. Mr. Smith's “invisible hand†was particularly effective in the South Carolina Lowcountry area, such that great wealth was achieved. Capitalism and its private property and American religious tolerance were the driving force of the Colonies' wealth. In 2026, as we prepare for the great American birthday party, capitalism still reigns supreme, and the authors report that the US Russell 3000 stock index has for the January 2006 – November 2025 period achieved a higher return-to-risk tradeoff than the World All Country World Investible (ACWI). Capitalism has allowed the US to reign supreme in global stock indexes. However, as the authors reported in early-2026, the Russell 3000 stock universe can be enhanced by creating a more global portfolio irrespective of current global universes. True Markowitz diversification can be achieved in global stocks. For US and intelligent global investors, the best is yet to come!

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Pages: 35 pages
Date: 2026-03
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