The next dollar you spend in the market can be as easily invested in companies from China, France, Japan, Germany as they can be invested in companies from the United States or Mexico. And considering the fact that everyone today can be (or is) is a global investor, have you ever wondered which country benefits the most from those investments?
Well I am about to show you. Take a look at the following graph.
Are you surprised at anything your two eyes can see? The above graph shows a twelve-year history of the market value of the companies that make up the Global 2000 according to Forbes Magazine from 2011 to 2022.
Based upon the above graph and my humble analytical mind, it would seem to me that the United States is the greatest beneficiary of global investments and globalization itself. And China? Well, not so much. And I really mean—not so much. In fact, global investments in China were less than global investments in Europe (about half as much) and less than the accumulated investments in other Asia-Pacific countries (e.g., Japan, South Korea, Taiwan, Malaysia, India, Australia)
Although the past year (2022) was not a banner year for the Global 2000 (total market value dropped from $79.7 Trillion in 2021 to $76.5 Trillion in 2022), most of that drop was from lower investments in China rather than anywhere else. While the global investments pretty much stagnated due to pandemic woes, investments in China companies dropped—accounting for over 70% of the $3.3 Trillion decline in the Global 2000.
Do you want to look at the above graph in another way? Check the following chart out, which breaks down the earlier graph in relative percentage terms.
Again, any surprises? For the first time since globalization began several years ago, United States companies now account for more than half of all global investments. This was something I was predicting would happen last year.
Pictures can be worth more than a thousand words and so is the case with the above two pictures. Regardless here is my short take on things:
- The United States dominates global investments.
- Europe has suffered the most from globalization, which is one of the reasons Europes’ relationship with the United States is so important to it.
- China is a “paper tiger” in terms of finance and economics.
- Free world countries account for nearly 85% of all global investments.
- There is one single growth engine in the global marketplace and that growth engine is the United States of America.
- And lastly, probably more important even than all the above, it is time to implement “globanomics”—otherwise in another twelve-years the United States will account for two-thirds of all global investments and the rest of the world will account for one-third.
And that is why you should probably pick up a copy of Globanomics (through Amazon) because it explains things in more than one-thousand words.
Makes sense.