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Market Capitalization As A Percentage Of GDP

The Wall Street Journal – U.S. Growth Slows in 2nd Quarter [1]

U.S. economic growth pulled back further during the second quarter of the year as consumer spending slowed–a reading that suggests domestic fiscal worries may becoming a more significant drag. The nation’s gross domestic product–the value of all goods and services produced–grew at an annual rate of 1.5% between April and June, the Commerce Department said Friday. The reading is down from the upwardly revised 2.0% growth rate during the prior three months and a 4.1% rate in the fourth quarter of 2011. Economists surveyed by Dow Jones Newswires had expected 1.3% annualized growth during the second quarter…The economy has grown for 12 consecutive quarters, covering all but the first months of the president’s administration, but the gains have been very mild by historical standards and haven’t been enough to significantly push down the unemployment rate. Growth slowed from the prior quarter as the pace of consumer spending eased and state and local governments continued to cut.

Comment

Today the Department of Commerce released GDP statistics for the second quarter of 2012. Below we highlight various measures of GDP, the stock market’s capitalization, and money supply. A complete list of our market capitalization charts can be found here [2].

As of June 30, 2012, stock market capitalization was 103.73% of nominal GDP ($16.18 trillion divided by $15.60 trillion).

Click to enlarge:

 [3]

As of June 30, 2012 M2 as a percentage of stock market capitalization was 61.47% ($9.94 trillion divided by $16.18 trillion).

 [4]

As of June 30, 2012 the two-year change in the stock market’s capitalization increased by $3.65 trillion or 23.38% of the size of nominal GDP.

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