Markets Matter

Capital markets recognize and drive investment to the best ideas and enterprises. Coupled with the free flow of capital, innovation is an integral component for supporting job creation, economic development and prosperity. Markets facilitate investment from those who seek a return on their assets to those who need capital and credit to grow.

Clients benefiting from robust and efficient capital markets include investors, both individual and institutional, governments and corporations. Capital, raised through equity and debt, can be used to grow businesses, finance investments in new plant, equipment and technology and fund infrastructure. This grows the economy and creates jobs and wealth.

US Capital Markets Are the Largest in the World

The U.S. capital markets are the largest in the world and continue to be among the deepest, most liquid and most efficient.

Equities: U.S. equity markets represent 40% of the $97 trillion in global equity market cap, or $39 trillion; this is 3.7x the next largest market, China.

Fixed Income: U.S. fixed income markets comprise 40% of the $106 trillion securities outstanding across the globe, or $42 trillion; this is 2.0x the next largest market, the EU (excluding the U.K.).
U.S. capital markets are the largest in the world

Capital Markets Drive Opportunity

There is a clear relationship between capital market depth and GDP per capita when expressed as purchasing power parity. Higher GDP per capita means individuals have higher disposable income and the potential to save more. Deeper capital markets may help drive higher GDP per capita through the more efficient allocation of capital. As such, the U.S., with its deep capital markets, accounts for 44% of total global markets activity. Its markets drive high GDP per capita, which in turn provides individuals with economic opportunities.
Capital Markets Around the World

Capital Markets Fuel Economies

Capital markets are important because they finance economic activity, manage risk, and support growth and financial stability. In the U.S., capital markets fund 72% of economic activity, in terms of equity and debt financing of non-financial corporations.

Capital markets enable debt issuance, which is an efficient and steady form of borrowing for corporations and governments. The use of debt capital markets is more prevalent in the U.S. at 80% of the total (versus 20% bank lending), compared to only 20-30% in other regions (where commercial bank lending is more dominant at 70-80%). Capital markets can act as shock absorbers during times of economic or market turmoil. As such, capital markets form a stable source of fuel for companies and governments.

Through equities markets, companies raise capital for various business purposes (invest in growth, fund mergers and acquisitions, etc.) and provide retail and institutional investors access to wealth generation.

In short, U.S. capital markets are the bedrock of our nation’s economic potential.

Capital Markets fuel Economies