Is the world jumping into US stocks?

It's time to buy American stocks, writes well-known investor Doug Kass.

He's not saying this for patriotic reasons. Instead, Kass describes the U.S. stock market as the best house in a bad neighborhood, and said that foreign investors will be moving in. The rest of the world is doing so badly that U.S. stocks stand to benefit, he writes.

"In Europe there is hopelessness," he writes. "The U.S. economy is moving forward, with steady growth expected and growing signs that the domestic recovery will be self-sustaining (albeit at a muddle-through pace). In the U.S. there is hope."

Post continues below.
It's an interesting point, and one that makes more sense than Warren Buffett's 2008 exhortation to buy American. Where are global investors going to invest? European equities are a huge question mark. China's economy is slowing down, and banks aren't meeting loan targets.

Emerging markets are stumbling as well. Check out the performance of the Vanguard MSCI Emerging Markets ETF (VWO).

So where will the world put its money? U.S. government bonds are a bad bet, according to Dan Wiener, who edits the Independent Adviser for Vanguard Investors newsletter.

"Sorry, I just can't get on the Treasury bond bandwagon," Wiener said in an interview with MarketWatch senior columnist Chuck Jaffe. "Anyone who is looking at government bonds really needs to think long and hard about why they're buying them. If you are a complete chicken and you are buying it just for the full guarantee, you should know you won’t make anything after inflation, and will probably be losing money."

Which brings us back to U.S. stocks. Even with all of its problems, the U.S. economy is still superior to most of the world's economies, Kass writes.

Here are some of his other reasons why investors should get into U.S. stocks:

• U.S. banks are pretty healthy, even after the embarrassing disclosure from JPMorgan (JPM) about its London Whale trading debacle.

• U.S. companies have strong balance sheets and profits. They are "rock solid operationally and financially," Kass writes.

• The U.S. consumer is stable, and household debt is down dramatically from the recent past.

• The U.S. politically stable and a magnet for immigrants who want a better life.

• U.S. companies have strict standards to adhere to when it comes to financial reporting. Regulators keep a close eye (relatively speaking) on companies. It's quite different from China, where you just never know if the numbers many companies issue are totally accurate.

• The U.S. is rich in resources.

More from MSN Money

• The wealthy are pulling up stakes
• Sears shares see mysterious drop
• Don't bet on the dollar