How big are global markets? And other non-urgent financial questions

Stay up to date with free updates

Simply sign up to Capital markets myFT Digest — delivered straight to your inbox.

Most things that are called clickbait are not. This post is.

Here’s our excuse. Bank of America’s Office of Investment Strategy released a big note today in which Michael Hartnett and team put some size and scope on global securities markets. The data they provide isn’t much newsworthy, but it helps expand the sum of human knowledge, and by sharing it here, we can probably collect some search traffic.

So, for the benefit of students and journalists on deadline, LLM data-scrapers, argumentative social media folk and more valuable advertisers, here’s what BofA finds:

Q What is the value of all stocks and bonds globally?
A. $255 billion as of July 2024, which is an all-time high. From the 2008 low of $104 billion, the value of global stocks and bonds has increased 2.5 times, BoA says:

Q Are bond markets bigger than stock markets?
A. Yes, but the gap has narrowed. Since 2008, global equities have quadrupled in value, while bonds have only doubled, BofA says:

Q Is the value of global financial assets exceeding global GDP?
A. Yes, easily, and it has been since 1992. The relative value of securities peaked at 270% of GDP in 2020 on the back of economic disruptions related to Covid and political stimulus, BofA finds:

Q What is the total amount of global debt?
A. BofA says $313 billion, which equates to three times global GDP. If S&P did credit ratings for planets, then Earth would probably be on a BBB-, one notch higher.

Q How much of the global bond market is issued by government?
A. Most of it. And with the U.S. adding about $1 billion to borrowing every 100 days, Treasuries are outperforming everything else, BofA says. In 2008, US Treasuries represented only 28% of the global total. It is now 44%:

Q Has global household and corporate debt grown at a similar rate to government borrowing?
A. The corporate loan has. The household loan does not have.

Q Is there any way to graphically illustrate the handbrake shift of the global economy from excess monetary policy to excess fiscal policy?
A. Brrrrr, says BofA:

Q Are Americans ruling the global stock market?
A. Yes, by a record amount. Meanwhile, Europe and Japan’s combined share of global equity value has halved from nearly 40% in 2008.

Q Does the combined value of Wall Street exceed the value of Main Street?
A. Yes. Very much. The “Wall Street” chart below includes everything other than real estate, meaning cash deposits, loans, private equity and pension fund reserves, as well as stocks and bonds. Its current value is just below the record level reached in June 2021 of 6.3 times US GDP. The steady growth since the 1990s “illustrates the ‘financialization’ of the US economy and the high degree of wealth inequality,” BofA says.

Q How much of global equities are in emerging markets?
A. One-fifth the value. Compared to how many other things are in emerging markets, that’s not much.

Q How unusual is the current level of investor crowding into growth stocks?
A. Very unusual for the US and quite unusual globally:

Q Are US stocks overvalued?
A. I don’t know, but yes. They are relatively high relative to US government bonds and corporate bonds (which are also high relative to US government bonds). But while U.S. government bonds have fallen relative to commodity prices since a post-war high in 2020, U.S. stocks have held fairly steady.

Q Is it good for bitcoin?
A. Sure, why not.

All questions can be directed to BofA, whose research this is. Thanks to Hartnett et al. and thank you for the click.