Have you noticed any economic upheaval lately? The American economy has been sputtering enough to make it easy to wonder: Should you be investing more money abroad?

Why NOT to invest abroad
There are plenty of reasons not to invest abroad, at least not directly. Plenty of Fools have written about them before. A big one is that most of us know much less about goings-on abroad than we do at home. We just don't have a good handle on how well various foreign companies will perform given their local competition, national business laws and accounting practices, and the overall geopolitical stability in the region.

Bill Mann, an experienced international investor, even warned about it back in 2000, pointing out that you can get plenty of exposure to global markets by buying American companies with big overseas footprints, such as Coca-Cola (NYSE:KO) and Cisco Systems (NASDAQ:CSCO). You may not realize just how many companies derive significant revenues abroad -- Yum Brands (NYSE:YUM) is one, thanks to the growing presence of its restaurants throughout the world.

Another reason not to invest heavily abroad is this: Even though the U.S. is in recession now, it may be poised for a recovery. Economies usually don't necessarily keep deteriorating forever. Typically, they advance and retreat, and then advance again. America may well maintain or regain its international leadership position in short order. It may be the best place for most or all of your investment dollars.

Why to consider it
All that said, there are still good reasons to contemplate international investment these days. While this isn’t meant to be a political article, some political issues do warrant concern -- such as budget deficits, continually growing consumer credit card debt, and our rapidly rising national debt. We're running annual deficits now, with our national debt hitting about $10.6 trillion, with little relief in sight.

It's not that this isn't a great country, or that things can't turn around. Some nations in living memory have gone from pedestals to pits (or vice versa) in fairly short order. But right now, it might be smart to spread a little more of your savings abroad. Microsoft (NASDAQ:MSFT) co-founder Bill Gates recently expressed a bearish stance on the U.S. dollar, despite its recent rebound.

How to invest abroad
If you're now eager to learn just how you might invest abroad, let's review some options.

First, you can let professionals do your international investing for you via mutual funds. Some mutual funds are expressly dedicated to investing in international stocks and/or bonds. And the managers of many other mutual funds have substantial freedom to invest at least some fund money in suitable international investments. Do a little research into funds that interest you and see how their managers are thinking about global economies and how they're investing.

Consider currency funds like CurrencyShares Japanese Yen (NYSE:FXY), which aim to profit as the dollar's value changes. They're risky, though, and may not be necessary if you take other steps, such as those listed above. Another option is buying American Express (NYSE:AXP) travelers checks in euros (or some other currency). But you'll forgo earning interest, which is kind of a big deal.

Finally, remember that there are many good old American companies with substantial overseas operations and revenue. PepsiCo (NYSE:PEP), for example, took in nearly $40 billion in 2007, nearly half of it from outside U.S. borders.

The bottom line
It’s impossible to tell the future precisely. After all, the dollar may well keep climbing. So for now, it’s good advice just to keep reading and learning -- and paying attention to the global reach of American companies you’re invested in or could invest in, as that's one good way to benefit from a troubled U.S. economy.

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Dan Caplinger updated and revised this article, originally written by Selena Maranjian and published in January 2005; he does not own shares in any of the companies mentioned. PepsiCo is a Motley Fool Income Investor selection. Microsoft, Coca-Cola, and American Express are Motley Fool Inside Value selections. The Fool owns shares of American Express and CurrencyShares Japanese Yen. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool is Fools writing for Fools.