Asset allocation · 20 August 2026
Where new money goes: a 10-year comparison of assets
Global liquidity expanded over the decade, but the return was not distributed equally. We compare financial assets with Dubai and seven peer property markets—including income, drawdowns and liquidity.
The central finding
Monetary expansion is a backdrop, not a valuation model
The expansion of fiat money can support nominal asset values over the long term, but the effect is distributed unevenly between asset classes. New liquidity competes for equities, bonds, gold, property, deposits and alternative assets.
Between June 2016 and June 2026, US equities, gold and Bitcoin delivered higher returns than Dubai property, but also experienced substantial short- and medium-term drawdowns. Dubai apartments produced a strong combined result through capital appreciation and net rental income.
Global liquidity proxy
Aggregate central-bank assets increased by approximately 47.8%
There is no single observable “global monetary base.” We therefore constructed a consistent proxy for aggregate central-bank assets: BIS data for 30 countries outside the United States, supplemented by the Federal Reserve balance sheet. The latest complete BIS quarter is Q1 2026.
| Indicator | Start | End | Growth | CAGR |
|---|---|---|---|---|
| Combined BIS + Federal Reserve liquidity proxy | $23.1tn Q2 2016 | $34.1tn Q1 2026 | +47.8% | approximately 4.1% |
This is a central-bank-balance-sheet liquidity proxy—not comprehensive global broad money and not proof that monetary expansion caused the return of any individual asset.
Financial assets and Dubai property
Ten-year return and risk comparison
| Asset | Price change | Income | Total return | CAGR | Volatility | Maximum drawdown | Sharpe | Relative to liquidity growth |
|---|---|---|---|---|---|---|---|---|
| Bitcoin | +8,596.8% | — | +8,596.8% | 56.3% | 74.1% | −75.6% | 0.95 | +5,783.3% |
| S&P 500 / SPY | +256.5% | dividends included | +318.5% | 15.4% | 15.3% | −23.9% | 1.02 | +183.1% |
| Gold / GLD | +191.3% | — | +191.3% | 11.3% | 15.1% | −23.8% | 0.79 | +97.0% |
| Dubai apartments | +64.7% | +67.1% net rent | +131.8% without reinvestment | 8.8% | n/a | n/a | n/a | +56.8% |
| Dubai apartments with rent reinvestment | +64.7% | rent reinvested | +192.4% | 11.3% | n/a | n/a | n/a | +97.8% |
| US investment-grade bonds / LQD | −11.1% | coupons included | +26.2% | 2.4% | 8.2% | −23.3% | 0.32 | −14.6% |
| Euro-area household deposits | — | interest included | +11.5% | 1.1% | 0.3% | 0.0% | 3.60 | −24.6% |
Market-asset risk metrics use monthly total-return series. Dubai rent is estimated after a 17% deduction from gross rental income. A directly comparable Dubai volatility, drawdown and Sharpe ratio are not reported because the post-May-2024 source provides a verified period change, not a complete monthly apartment index.
Property comparison
Dubai and seven comparable markets
The original research universe covered 31 global cities. A ten-year total-return comparison is shown only for markets where sufficiently comparable price and rental series could be assembled. Dubai is shown separately and is excluded from the seven-city average.
| City | Price change | Net rental income | Total return without reinvestment | Relative to liquidity growth | Total return with reinvestment | Maximum price-index drawdown |
|---|---|---|---|---|---|---|
| Dubai | +64.7% | +67.1% | +131.8% | +56.8% | +192.4% | n/a |
| Chicago | +38.3% | +76.3% | +114.7% | +45.2% | +160.7% | −1.1% |
| Los Angeles | +68.4% | +43.0% | +111.4% | +43.0% | +127.8% | −4.5% |
| New York | +38.6% | +54.0% | +92.6% | +30.3% | +113.9% | −3.3% |
| Boston | +40.7% | +49.9% | +90.6% | +28.9% | +107.8% | −2.5% |
| San Francisco | +18.8% | +28.8% | +47.6% | −0.1% | +53.9% | −13.6% |
| Hong Kong | +20.1% | +26.3% | +46.5% | −0.9% | +48.2% | −22.4% |
| London* | +8.7% | +36.6% | +45.3% | −1.7% | +53.0% | −2.7% |
| Seven-city average excluding Dubai | +33.4% | +45.0% | +78.4% | +20.7% | +90.8% | −4.1% |
* London ends in May 2026. City indices can represent different market segments. Property taxes, transaction costs and financing are excluded. Smoothed indices can materially understate the decline of an individual unit and do not measure the discount required for an urgent sale.
Dubai
A strong combined result from price and rent
Dubai apartment prices increased by approximately 64.7%. Accumulated net rental income added about 67.1%, producing a combined return of approximately 131.8% without reinvestment and 192.4% in the reinvestment scenario. The seven-city average was 78.4% without reinvestment.
The result was supported by population growth, expansion of the non-oil economy, infrastructure, safety, tax attractiveness, international migration and a long-term development strategy. Differences in data, taxation and market structure mean this is a comparative framework—not a claim that the assets are perfectly equivalent.
Long-term optionality
The GCC discount may narrow
Our previous research did not find clear evidence that Dubai is undervalued under the market’s current structure. It did find that a regional GCC factor materially improved the comparative models and reduced the model-implied price of Gulf cities relative to global peers.
The statistical discount may combine market youth, international investor awareness, geopolitical perception, transparency, liquidity and limited naturalisation opportunities. If Dubai’s fundamentals remain strong and part of that discount narrows as the market matures, the city could experience faster price growth than some comparable markets. This is a conditional thesis—not a guaranteed forecast.
Risk
Higher returns required tolerance for deeper drawdowns
Bitcoin’s maximum observed drawdown was approximately 75.6%. The S&P 500, gold and US investment-grade bonds each experienced drawdowns close to 23–24%. Property appears smoother partly because it is valued and traded less frequently; the published index does not reveal unit-level volatility or liquidity costs.
Conclusion
Liquidity supports assets, but fundamentals allocate the return
Fiat-money expansion can support nominal asset values, but it does not replace fundamental analysis. US equities, gold and Bitcoin produced higher returns but required investors to tolerate substantial volatility. Dubai property offered a strong combination of appreciation and rental income.
Future Dubai performance will depend on economic and population growth, new supply, asset-specific quality, entry price and the possible narrowing of the GCC discount. The question is not only how much money exists, but which assets can continue attracting it on sustainable terms.
Method and sources
How the figures were assembled
- BIS — central-bank total assets
- Federal Reserve — definitions and balance-sheet context
- Dubai Land Department — residential property price index
- DXB Interact — verified apartment price change after May 2024
- FRED — Bitcoin price series
- ECB — euro-area household deposit rates
- Zillow — US metropolitan housing data
- Hong Kong Rating and Valuation Department
- UK Office for National Statistics — housing and rent data
Performance relative to liquidity is calculated geometrically as (1 + asset return) ÷ (1 + 47.8%) − 1. Results are nominal. The study does not include investor-specific tax, financing or transaction costs unless explicitly stated.
Test the specific property—not only the market story.
Educational material only. It does not constitute investment, legal, tax or financial advice.