GOING GLOBAL

September 4, 2015


The data from which this post is taken may be seen from the following sources: 1.) Business Insider, 2.) Investopedia, 3.) World Stock Exchanges 4.) Commerce.gov and 5.) The World’s Richest Countries.    The text is mine.

There is absolutely no doubt the United States of America exists in a global community.  Proof of this statement can be seen from various trade agreements between our country and others.  We have regional, multilateral and bilateral trade agreement with other countries with a fairly long list of agreements “in the works”.    Commerce.gov  published the following news release on February 15, 2015:

“U.S. Secretary of Commerce Penny Pritzker today announced that U.S. exports in 2014 set a record for the fifth consecutive year, reaching $2.35 trillion. International Trade in U.S. Goods and Services data released today by the U.S. Department of Commerce show that U.S. exports are up more than $760 billion since 2009.”

So much for exports.  Now let’s look at imports. From The World’s Richest Countries we see the following:

“America is the world’s second-richest country and largest importer. In 2014, the US bought US $2.410 trillion worth of imported products. That total is up by 22.5% since 2010.”

We export and import from just about every country in the world.  The top ten (10) imports from three of our most important trading partners are as follows:

IMPORTS FROM JAPAN

IMPORTS FROM CHINA

IMPORTS FROM GERMANY

There is other trading on a daily basis accomplished between investors through stock markets over the world. Hourly buying and selling occurs between markets providing huge opportunities for those individuals and financial institutions savvy enough to take advantage of trading mechanisms established decades ago. If we examine the market capitalization figures for the most prominent stock exchanges we see the following:

MARKET CAPITALIZATION

Let’s now define market capitalization.

“The total dollar market value of all of a company’s outstanding shares.  Market capitalization is calculated by multiplying a company’s shares outstanding by the current market price of one share. The investment community uses this figure to determine a company’s size, as opposed to sales or total asset figures.  If a company has 35 million shares outstanding, each with a market value of $100, the company’s market capitalization is $3.5 billion (35,000,000 x $100 per share).”

The following list will indicate the top twenty (20) stock markets over the world.  I have given digital photographs of the trading floors for the top five (5) and brief information relative to each.

  1. New York Stock Exchange (NYSE)– Headquartered in New York City. Market Capitalization (2011, USD Billions) – 14,242; Trade Value (2011, USD Billions) – 20,161.

The largest stock exchange in the world by both market capitalization and trade value.  The NYSE is the premier listing venue for the world’s leading large- and medium-sized companies. Operated by NYSE Euronext, the holding company created by the combination of NYSE Group, Inc. and Euronext N.V., NYSE offers a broad and growing array of financial products and services in cash equities, futures, options, exchange-traded products (ETPs), bonds, market data, and commercial technology solutions. Featuring more than 8000 listed issues it includes 90% of the Dow Jones Industrial Average and 82% of the S&P 500 stock market indexes volume.

NEW YORK STOCK EXCHANGE

  1. NASDAQ OMX– Headquartered in New York City. Market Capitalization (2011, USD Billions) – 4,687; Trade Value (2011, USD Billions) – 13,552.

Second largest stock exchange in the world by market capitalization and trade value. The exchange is owned by NASDAQ OMX Group which also owns and operates 24 markets, 3 clearinghouses and 5 central securities depositories supporting equities, options, fixed income, derivatives, commodities, futures and structured products. It is a home to approximately 3,400 listed companies and its main index is the NASDAQ Composite, which has been published since its inception. Stock market is also followed by S&P 500 index.

NASDAQ STOCK EXCHANGE

  1. Tokyo Stock Exchange– Headquartered in Tokyo. Market Capitalization (2011, USD Billions) – 3,325; Trade Value (2011, USD Billions) – 3,972.

Third largest stock exchange market in the world by aggregate market capitalization of its listed companies. It had 2,292 companies which are separated into the First Section for large companies, the Second Section for mid-sized companies, and the Mothers section for high growth startup companies. The main indices tracking Tokyo Stock Exchange are the Nikkei 225 index of companies selected by the Nihon Keizai Shimbun, the TOPIX index based on the share prices of First Section companies, and the J30 index of large industrial companies. 94 domestic and 10 foreign securities companies participate in TSE trading. The London Stock Exchange and the Tokyo Stock Exchange are developing jointly traded products and share technology.

TOYOKO STOCK EXCHANGE

  1. London Stock Exchange– Headquartered in London. Market Capitalization (2011, USD Billions) – 3,266; Trade Value (2011, USD Billions) – 2,871.

Located in London City, it is the oldest and fourth-largest stock exchange in the world. The Exchange was founded in 1801 and its current premises are situated in Paternoster Square close to St Paul’s Cathedral. It is the most international of all the world’s stock exchanges, with around 3,000 companies from over 70 countries admitted to trading on its markets. The London Stock Exchange runs several markets for listing, giving an opportunity for different sized companies to list. For the biggest companies exists the Premium Listed Main Market, while in terms of smaller SME’s the Stock Exchange operates the Alternative Investment Market and for international companies that fall outside the EU, it operates the Depository Receipt scheme as a way of listing and raising capital.

LONDON STOCK EXCHANGE

  1. Shanghai Stock Exchange– Headquartered in Shanghai. Market Capitalization (2011, USD Billions) – 2,357; Trade Value (2011, USD Billions) – 3,658.

It is the world’s 5th largest stock market by market capitalization and one of the two stock exchanges operating independently in the People’s Republic of China. Unlike the Hong Kong Stock Exchange, the SSE is not entirely open to foreign investors. The main reason is tight capital account controls by Chinese authorities. The securities listed at the SSE include the three main categories of stocks, bonds, and funds. Bonds traded on SSE include treasury bonds, corporate bonds, and convertible corporate bonds. The largest company in SSE is PetroChina (market value – 3,656.20 billion).

SHANGHAI STOCK EXCHANGE

  1. Euronext
  2. Frankfurt Stock Exchange
  3. Shenzhen Stock Exchange
  4. Hong Kong Stock Exchange
  5. Toronto Stock Exchange
  6. BM & F Bovespa
  7. Australian Securities Exchange
  8. Deutsche Borse
  9. Bombay Stock Exchange
  10. National Stock Exchange of India
  11. Korea Exchange
  12. OMX Nordic Exchange
  13. JSE Limited
  14. BME Spanish Exchanges
  15. Taiwan Exchanges

It is very obvious all of the exchanges exist and thrive with capitalism being the model.  Free unfettered trade has become the norm even though countries do place restrictions on imports to protect their basic industries.  It would be marvelous (I think) if all restrictions on goods other than weapons of mass destruction could be traded freely and without tariffs.

I certainly, as always, welcome your comments.

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