The combined market cap of all publicly traded stocks across the world has gained $1 trillion this week as Dow Jones continued its great bull run to a new all time high.
The combined market cap of all publicly traded stocks now stands at $86.4 trillion, just a trillion off the all time high and near 100% the global GDP.
This is just the publicly traded stocks. For example, the world’s most valuable public company, Saudi Aramco, was not included in the above market cap just weeks prior to its IPO despite this company now being valued at $2 trillion.
Nor are the gains evenly distributed. In fact it appears only America is booming, the rest are stagnating except for Europe:
Top left is Dow Jones. Up and up. Nearly doubled since 2017. Next to it is European stocks as a whole. Some volatility, but ends with a high.
China top right is a mixed picture, just about back to last year. For UK, it’s kind of worse. Almost complete stagnation. Sort of same for Japan and Germany.
America first, at the expense of everyone else it seems with the Euro area boosted perhaps by the eastern part which is still developing and growing fairly well at 4%-5% for some countries like Estonia.
The western part is a bit sclerotic. Stagnation at best, contracting at times in real terms. The culprit? Probably lack of reform.
You can’t have a monetary union without a political union. They’ve been talking for years about a banking union, but bureaucracy being what it is, it moves very slowly.
Yet there’s reason for optimism. Two new blonds take charge. Boris Johnson in Britain and Ursula von der Leyen as European president.
Both have a formidable task. Johnson wants to digitize the British civil service with a £100 billion investment. Leyen is what can be called a European patriot. Her task is to unite the continent, beginning perhaps with a Citizens’ summit.
That can make the new decade an exciting one, including potentially for cryptocurrencies which have found some stability:
Two halvenings and a PoS. That’s what 2020 has in store for this space, starting with BCH’s reduction of new supply by 50% in April. Followed by bitcoin. For ethereum, the much expected ethereum 2.0 Proof of Stake (PoS) genesis block should launch by June.
The question is whether potential crypto bullishness will come at the expense of Dow or whether it will fuel it.
There is no significant correlation, but some are saying stocks are entering bubble territory. In which case, the profits taken will have to find some place and cryptos could be a decent one in a speculative manner.
They may also go from Dow to European or other global stocks, but it could also be the case the boom continues, with others joining it too.
AS great as this bull run has been, it’s not the greatest, up only circa 4x since the low of 2009.
The 80s and 90s boom had an increase of 11x from one reading, and 5x for just the 90s.
So for United States stocks might have more room to grow, with the best case scenario giving another 5x next decade as the boom starts roaring.
Photo by Emiel Van Betsbrugge, Copyrights Trustnodes.com