Wednesday, November 18, 2020

Liquid global bond and equity market cap now totals $160 trillion

There's a lot of wealth out there. The global market capitalization of large and liquid stocks and bonds has reached the impressive sum of almost $160 trillion. (Note that this number excludes the market cap of ETFs and ADRs, to avoid double-counting.) Since late 2003, when they first started keeping track of this, the annualized rate of growth of US and global equities has been approximately 7%, which is very much in the same ballpark as the long-term total annualized return rate of US equities (not counting dividends). Which is to say there is no prima facie evidence here of any equity "bubble." The world has prospered, and we are all richer and more prosperous.

Chart #1

Bank of America/Merrill Lynch publish extensive statistics covering global bond markets, which now total about $32 trillion. They only include issues which are relative large and liquid (i.e., marketable). Bloomberg publishes the market cap of marketable global equities, and that now totals about $97 trillion. Chart #1 compares the relative sizes of these markets.

Chart #2

Global equity market cap has certainly had its ups and downs, but over time the annualized growth rate of this statistic is about 7%, as shown in Chart #2. Those who were fortunate—or smart enough—to have purchased equities at the bottom in early 2009 have since enjoyed a total return (not counting dividends) of about 270%. Similarly, the market cap of global equities today is about 60% higher than it was in late March at the height of the Covid panic. Needless to say, selling during times of panic is not a winning strategy over the long haul. Buying is. 

Chart #3

Chart #3 compares the market cap of US and non-US equities. Note how both markets have grown by about the same amount over the past 17 years. 

Chart #4

Chart #4 shows the ratio of US to non-US equity market cap. Note how the US drastically underperformed the rest of the world from late 2003 through late 2007. The US then went on to recover most of that underperformance from 2012 through today. 

NOTE TO READERS: In reaction to the very troubling and increasing spread of politically biased censorship on major social networks (e.g., Twitter, YouTube, FaceBook) I have established a presence on the rapidly-growing Parler network. Parler was established with the explicit aim of promoting free speech by avoiding all censorship, something I heartily embrace. I can be followed on Parler as @Sgrannis.

35 comments:

Benjamin Cole said...

Kudos to Scott Grannis on joining Parler.

No matter your politics, independent voices and dissent are needed from your point of view.

Something even darker than mere censorship may be happening in America. The whole Russiagate story, which resulted in the impeachment of a president, seems to come to vapors.

The great need is for independent and skeptical minds, both left-wing and right-wing, and the complete dismissal of PC rhetoric of any stripe.

On another matter, I once toted up global bond and equity markets, and global property markets, and came to a rough figure of about $400 trillion. I guess my figures include some non-marketable or less liquid securities.

Benjamin Cole said...

https://www.stoxx.com/index-details?symbol=V2TX

This is the volatility index for the Eurostoxx 50. It just hit its lowest (best) level post-pandemic.

I don't know what all that means, but I guess it is a good sign. And this while there is a C19 spike in Europe.

If global equities stay strong through 2020, then..sheesh, what will bring down stocks?

randy said...

Republicans are in dangerous territory. The election results actually presented an unexpected and huge opportunity, since voters appeared to reject Trump but more importantly reject the progressives just as strongly. The Republicans now had the chance to frame themselves as the sane ones, maybe even getting some legislation on health care and immigration to show some evidence of ability to govern. They would regain significant voter base for the future. But no. Republicans are one-upping craziness instead - explicitly promoting Q-Anon conspiracies about the election. That Gulliani press conference is a decision point. If the Republican leaders do not loudly denounce this unequivocally - a lot of voters will be convinced the Lincoln Project grifters are right, that the only way to save conservatives is to burn down the Republican party. Write your Republican Senator.

TWD said...

I agree randy. It is said that the Republican party has become the party of Trump, and true conservatism is over. Rudy G. is an extreme embarrassment. Trump refusing to disavow Qanon did it for me. Trump's clown show will likely continue, and it is extremely damaging to our democracy. I miss the old Republican party.

Johnny Bee Dawg said...

Voters didn't reject Trump. Trump is the only reason for the PUB surge.
There were hundreds of thousands of ballots marked only for Joe Biden...no other votes for any other contests. And that occurred only in the swing states who stopped counting on Election night. They didn't have time in the middle of the night to mark any other contests. Just brought in the "Joe only" ballots at 4am. Orange Man Bad.

There was massive fraud. Sleepy Joe couldn't draw flies to a single rally. No way Sleepy Joe got millions more votes than Barack did at His peak.
Lets see if the courts agree.

Joe is handled by the same exact people that told Barack what to do and say.
Those Barack handlers gave us the slowest economic recovery since FDR. He left our GDP $3 Trillion below trend.
Trump gave us the fastest economic recovery in US history, and lowest unemployment in 50 years.

Trump policies gave us the biggest Median Household Income increase ever in US history in 2019.
Trump's REAL household income gains in 2019 were more than Baracks gains in ALL HIS 8 YEARS, COMBINED.
Barack launched new military attacks in 6 new countries, while funding ISIS with US weapons and US taxpayer cash (along with John McCain.)
Trump cut off the ISIS funding, wiped them out, and brought our troops home.

Nobody sane rejected Trump.
We will just have to see how it goes in the Constitutional process.

Trump brought back true Conservatism: tax cuts, regulation cuts, reduced government power, more economic opportunity for the most people. Less war. Energy Independence. Fast Tracked vaccines. American exceptionalism. Saved the Party.
GOD BLESS DONALD.

steve said...

JBD, you are truly out of your mind and Trump is finished. It may take until states certify results (12/8) but he is done.

I agree with Randy that the GOP is is damn dangerous territory and GA may go to the Dems if they don't back off this insanity of backing a petulant loser who is obfuscating democracy.

Larry said...

JBD,
Right on!
Tell it like it is!
Nobody sane rejected Trump. SO TRUE!
Keep up the good fight JBD.

Unknown said...

JBD,
Dido to Larry!! Keep up the good fight JBD...

EHuang said...

Enjoy reading the spectrum of comments here. Disagreements, but not shouting and nothing personal.

The recent censorships on social media has gone too far.

What ever happened to open debate. Even if the president says some outrageous stuff, it should be on display for us to see and decide.

Why has the ACLU been so quiet?

steve said...

What is going on is a national embarrassment. Practically an attempted coup and will have disastrous long term effects on the GOP which may very well lose GA seats as a result. Republican party's humoring Trump on this is perhaps the most ignominious party wide eyewink in US political history. Trump has duped 71M people to vote for him in an attempt to avoid his pitiful business and legal mess he will walk into. No matter. It's almost over. Character Trumps policy.

randy said...

The ACLU:

https://www.wsj.com/articles/the-aclu-retreats-from-free-expression-1529533065?st=cz3swwigktaum00

The ACLU Retreats From Free Expression
The organization declares that speech it doesn’t like can ‘inflict serious harms’ and ‘impede progress.’

The American Civil Liberties Union has explicitly endorsed the view that free speech can harm “marginalized” groups by undermining their civil rights. “Speech that denigrates such groups can inflict serious harms and is intended to and often will impede progress toward equality,” the ACLU declares in new guidelines governing case selection and “Conflicts Between Competing Values or Priorities.”

This is presented as an explanation rather than a change of policy, and free-speech advocates know the ACLU has already lost its zeal for vigorously defending the speech it hates. ACLU leaders previously avoided acknowledging that retreat, however, in the apparent hope of preserving its reputation as the nation’s premier champion of the First Amendment.

Fred said...

If there was any credible proof of fraud, the Trump legal team would have already been before a US District Judge on a motion for injunctive relief to stop the certification of election results. They would have put up witness after witness with documentary evidence and allowed the Biden team to cross-examine the witnesses and if the Trump teams had enough evidence to show the judge that there was a "strong likelihood of success on the merits", the judge would issue the injunction and move rapidly to a full hearing. I have brought and defended against cases for injunctive relief many times over my legal career and that is how it's done. And I'm not talking about the theoretical possibility of voting machine fraud or dead people sending in mail-in-ballots; I'm talking about credible evidence that it did in fact happen and that there was enough of it to change the results. I believe there were enough anomalies in outcomes to do an investigation and I am open to the possibility that evidence of fraud exists, but unless Trump puts forth sufficient evidence of such, I do not believe any judge will overturn the election. I also seriously doubt any judge (including the US Supreme Court) will overturn election results based on a 14th
Amendment Equal Protection analysis. Remember, Bush v. Gore stopped endless recounts by the Florida Supreme Court. Gore never lead Bush and no court ever invalidated votes that had already been cast. It's time to focus on my home State of Georgia so we can keep the Senate red.

The Cliff Claven of Finance said...

Steve
You are completely ignoring the Biden Crime Family selling political influence for decades, and failing to realize Donald Trump has been investigated more than any other president, by far, and no criminal violations were found.

It was a contest between the a crime free president, and an extremely corrupt Delaware politician.

Unfortunately, we now have the most corrupt president in history even bEFORE he takes office.

The fact that your liberal-biased sources of information keep you in the dark about Biden, or lies to you about Trump, SHOULD concern you, but probably does not. Because truth is not a leftist value.

You may begin the usual leftist character attacks now.

randy said...

Cliff,

Can't figure out what your point is. That Donald wasn't nearly as corrupt as Biden? OK... I'm on board doing whatever we can to keep GA senators GOP. Should Biden's character make it reasonable to believe tall tales about massive election corruption involving Venezuela communists, unrelated election officials across multiple states all colluding, all without detection or some whistle-blower, or detection with hand counting 5 million votes in GA? Please.

I'm convinced its just a branding and fund raising exercise. The foundation for his new media company.

If one wants to expand voter support for GOP as protection against the left, supporting even tacitly Donald's conspiracy theories is a bad way to go about it. Yes there will be random fraud, bias and corruption - fine, investigate those. But GOP shouldn't get dragged down his toilet hole.

steve said...

I am NOT a left winger. Not by any means. First time in my life I voted for a democrat. I just cannot stand Trump and am not fooled by his "Make America Great Again" mantra. If Trump cared about the USA he'd concede an election he obviously lost. But he does not. He cares about himself-and BTW always has.

The Cliff Claven of Finance said...

Trump was not corrupt at all
Four unjustified investigations proved that
The "Mueller" team was ALL Democrats investigating only Republicans for almost 2 years.
the fake impeachment charges did not include any violation of any federal statute;
You Democrats are horrible people, but you did prove Trump did NOT commit any crimes except in your own deluded imaginations.

There is far more evidence of 2020 election fraud on affidavits, with the penalty of felony perjury for lying, than in all previous presidential elections, combined, since I was born in the 1950s.

Trump does care about the USA unlike the Biden Crime Family raking in money from Ukraine, China, Russia and elsewhere selling influence and giving old Joe a piece of the action.The most corrupt politician to ever become president.

If Trump only cared about himself, he would NOT have run for president, knowing half the country would oppose him, he would NOT have refused his $400,000 a year salary and he would NOT have cut off all foreign deals for his company while in office, because foreign deals were the primary deals in the past decade.

The GOP did very well in the 2020 election, except Trump, or didn't you bother to notice that Randy?

If you voted for a Democrat, Steven, you ARE a left winger.

steve said...

That's Stephen, the only correct way to spell the name and I disagree with you re labels. In my opinion character is more important than policy and try as they might a POTUS only changes the direction of the economy at the fringes-which is a good thing. The driver of the economy is obviously the American free enterprise system and YES I recognize that a socialist agenda could change that direction which is why the two GA seats are so important. The GSA confirmed Biden's win and it looks like Trump is allowing the transition too begin. I hope I never feel compelled to vote democrat again but there was no way I could look my five grown children in the eye and say "I support Donald Trump".

Johnny Bee Dawg said...

Fred:
You know the Trump legal team did all that, right?
I have zero confidence that any DEM judge will move to throw out fraudulent DEM ballots, and overturn the DEM election for the mob-connected DEM candidate. No matter how many sworn affidavits from eyewitness, and dozens of impossible statistical anomalies. The fix is in from both parties. Hillary’s people were lazy last time, and Trump beat the rig. Been saying that for 4 years. China Mitch met with Biden staff immediately to help select the new cabinet that he will approve in the Senate. Orange Man Bad. PUB Swamp celebrating.

Steve
Trump isn’t the one “obfuscating democracy”. Everything he’s done has been lawful, and by the book. That cannot be said about the criminals running this new Kamala Harris administration.

Survey today showed that only 45% of DEM voters even heard anything about Hunter’s laptop before the election. 9.4% said if they had known about Biden’s payments from the Chinese Communist Government and from Russia, they never would have voted for him. DOJ is predictably uninterested in any of the illegal activities of the Swamp for 4 years. Barr is on vacation instead of investigating voter fraud.

Mission accomplished.
First President in US history to never be asked or answer a substantive question during his entire campaign.
Almost as coddled and protected as Barack. All of this is a fraud.

The good news for stocks is the Chinese Flu is ending after inauguration, and the economy will re-open, and Yellen & Powell will accommodate forever. They gotta make a senile diaper-wearing POTUS look good...and at least Yellen isn’t Elizabeth Warren. Reminds me of ending Mark-to-Market accounting in March 2009 to cover up the socialist motivations of the Fallen Messiah. Value gonna close the historic gap with Growth. Value, Small Caps, High Beta.

If I lived in crooked Georgia I wouldn’t bother to vote in that runoff.
It will be rigged too. Same rules, same criminals running it all. China money runs it all.
The Deal has already been made. They will give us the outcome they’ve already negotiated.
Voting is irrelevant.

Fred said...

Johnny: Rod Serling had nothing on you. Watch out for those Aliens. I hear they like to experiment on bikers. Happy Thanksgiving!

Johnny Bee Dawg said...

Because nobody has ever stolen an election before.
That would CRAZY to think that. Government never lies to you. You can trust them.

85%-90% turnout is totally normal for Saddam and Kim Jung...and for Senile Joe Biden.
Joe...the guy who couldn't even draw flies to his "rallies" during the campaign.
The excitement was electric all around his basement.

Joe got 30%-40% more votes than Barack or Hillary did in the big crooked DEM swing state cities...but nowhere else.
In fact, everywhere else in the country he underperformed Hillary in the other big cities. Just a coincidence.
Detroit had near zero net population growth since those elections...yet Joe fired em up and got 30% more votes than Barack.
Despite Trump getting the most black and Latino votes of any PUB in decades.

Sorry, but none of it is believable if you have common sense.

The ONLY places that stopped counting on election night were the big cities in swing states where Trump had massive leads.
And of course, the ONLY place where hundreds of thousands of ballots poured in at 4am were in these big cities in the Swing states.
And the ONLY time those questionable ballots poured in was when the Republican observers had just been ejected from the premises.
And then, gosh darn it, ALL of the middle of the night ballots were marked for Joe. Saved by the Vote Fairy!
Its a Christmas Miracle!

Good ol Joe.

Every single "software glitch" that messed up thousands of votes was in Joe's favor. Every single one.
Darn the luck. Glitches.

Yep...the whole election night FRAUD sounds like something Rod Serling would have written.

Fred said...

I guess we’ll just have to see what kind of lawsuit Sidney files in Georgia, as promised. She will be subject to Rule 11 sanctions unless she has the proof to backup the allegations.

Johnny Bee Dawg said...

I have no expectation that any "lawsuit" is going to bring justice to this massive CON.
Every PUB has abandoned Trump...way before the election. He is THE threat to DC power, obviously.
His only fans are the lowly voters.

Let Mitch or Susan Collins or Romney zip down to Georgia to fire up the troops for those runoffs. LOL.
There will be less people there for those rallies than even Biden could muster.
Trump ALONE is the reason for the PUB success in this election. And when he is absent, so is the voter support for the down ballot.

There are hundreds of statistical anomalies and impossibilities in this election data. Any citizen can see these if they have the slightest bit of curiosity.
And there are literally hundreds of sworn eyewitness affidavits testifying to election fraud by officials.
Almost 400. Under Oath, and under penalty of perjury. None of that matters if the Fix is in.
Barack is laughing at the voters and the whistleblowers. The Deplorables.
"The Small People" clinging to their religion and their guns. 3rd term is coming.

We just watched the CIA and FBI collude to try to take down the POTUS...all exposed when the documents were declassified.
Yet nobody who matters was even questioned about it...much less prosecuted.
None of that mattered when the Fix was in, either. But we watched it. We know The Fix is in. That showed us.
Too many "at risk"of getting caught to let an outsider like Trump run wild telling the Truth.
DC is a massive money grab. Prove me wrong.

The Swamp doesn't want to be drained, and The Swamp controls DC.

Lou Dobbs reports that 79% of Trump voters think the election is being STOLEN.
Over 25% of DEM voters think so, too. Hmmmm.
That's a problem. That didn't come from Trump. We have eyes.

Pretend everything is fine. Pretend we are going to "HEAL" and "Come Together".
The Rubes eventually wont put up with this lawlessness in our rulers. Not yet. But its coming.
Voting is obviously no longer a reliable remedy to fix bad government. This is dangerous.

Fred said...

Well at one point in history 100% of the population thought the world was flat but that did not make it so. Where did you get your information about Detroit? The official certified results show Obama got 324,895 votes in 2008 and 281,743 in 2012. Biden got 240,936 this year.

Fred said...

Obama’s share of the vote in 2008 and 2012 was about 97% while Biden’s share was 94% of the total.

steve said...

JBD, 79% of Trump voters are as screwy as you so yeah, it does not surprise me that they think the ENTIRE country is rigged. A vast left wing conspiracy. It could not possibly be because Trump is a complete jerk! Where I come rom that's called SORE LOSER. It's over. Get over it.



steve said...

One more point and I'm moving on. Little doubt in my mind that if Trump wasn't such a divisive
person, he would have won hands down.

randy said...

I'm inclined to Holman Jenkins (WSJ) take. The democrats were just as dramatic with claims of a stolen election due to Russian collusion / conspiracy. (The difference being they had the whole weight of the media, FBI, the outgoing Obama admin etc behind it for 3 years). For both sides it's only a "fair" election when your side wins. It's all theater that shouldn't shock us. The truly legitimate basis for corruption / stolen election is the media bias over the last 4 years.

randy said...

I hope JBD is right (again) about value closing the gap with growth though.

randy said...

Clarifying the comment above... it shouldn't shock us, but I still very much think the GOP leadership should have denounced the wilder claims that contribute to 79% of one side thinking elections are rigged. But seems wishful thinking.

The Cliff Claven of Finance said...

For the deaf, dumb, and blind Dumbocrats who comment here.

I have written a short article about the strange numbers
in the 2020 election data, To sum it up, there is more
evidence of election fraud in 2020 than in all other
presidential elections combined, since I was born
in the 1950s.

http://electioncircus.blogspot.com/2020/11/2020-election-unusual-numbers.html

It's almost impossible to prove fraud with mail in
ballots, since that has to happen before they are
removed from the envelopes. After which they become
anonymous ballots, whether they are legal or illegal votes.

Leftists strongly believe what fellow leftists in the
government and media tell them to believe.
They are not capable of independent data-based thinking.

They "debate" with character attacks.

And they will do even more cheating to win
the January 2021 Georgia runoff
if no one is punished for election fraud
on November 3m 2020.

Truth is not a leftist value
Power is a leftist value.
By any means necessary.

The failure to not learn about
the Biden Crime Family is a
decision that most leftists
have made.

The failure to not learn about
election fraud in the 2020 election
is another decision that most
leftists have made.

If they don't want to know
about a subject, leftists just
pretend nothing happened.

That is the world of the
leftist trained parrots.

They make up stories
about criminal behavior
President Trump never committed.
Investigate him four times
and find nothing.

They ignore the Biden Crime Family
even after Uncle Joe Biden confessed
to extorting the Ukraine President
in 2016, bragging about his quid pro quo
extortion on a 2018 video.

But you leftists would rather
invent crimes a Republican president
never committed while ignoring crimes
a Democrat Vice President bragged
about committing.

When did the Democrats become
such horrible people with completely
different standards for Republicans
and Democrats? If leftists did not
have double standards, they'd have
no standards at all.

Let the usual leftist character attacks begin now.

Scott Grannis said...

It seems pretty clear to me that Trump was absolutely right about mail-in voting: it is terribly prone to fraud and abuse and should be done away with. And I see no reason why asking for voter ID disenfranchises anyone, when ID is required of most people to do anything important (e.g., cash a check, take a flight, drive a car)

GMM said...

One of the great things about this election is that it has proven that it doesn't matter who runs the country as long the President can be said to be a moderate and the government divided. The fact that literally no one thinks Biden will actually be making decisions or is physically capable of working for more than an hour a day is irrelevant to whether the country will continue to prosper and even lead the world. America will have the best and the brightest administrators and the the notion that the country requires a singular executive and comander in chief is an outmoded relic of centuries past.

Johnny Bee Dawg said...

GMM...the thought of unelected, and unaccountable "behind-the-scenes" bureaucrats running the government is terrifying, and against every concept of Liberty and representative government that made us the greatest country in world history.

This is a Marxist coup, and lots of folks are clapping for it.
Be careful what you wish for.

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richard burcik said...

Californians recalled Grey Davis. Why not add Gavin Newsom to this list?