The global economy in 2020 nearly collapsed due to the global Covid-19 pandemic and people feared it would bring us back to the 2008 global financial crisis. But contrary to those speculations, stock markets bounced back to normal operations, individual economies of the countries managed to hold on to their healthy state and businesses reopened with few limitations. We decided to create a brief overview of the financial world as it is today to illustrate how the global economy is performing and how individual countries, companies and people contribute to the financial world.
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Interesting facts about the financial world summarised in text
Nowadays, the health of the global economy is much more relevant than it has ever been and attracts the attention of millions of economic, political and financial experts. As globalization is nearing its peak, the significance of individual legal or physical entities along with their economic performance is increasing in the financial world. We will tell you a story of the global financial industry, its current achievements, prospects and summarize them into 6 most interesting facts ranging from GDP, inflations and global wealth to stock markets and the largest corporations worldwide.
In 2020, the combined global Gross Domestic Product (GDP) was estimated to 84.54 Trillion US dollars. The largest contribution to the world GDP belongs to Asia-Pacific region comprising over 42% with China, Japan and India being the main economic drivers. The second largest global GDP contributor is North America (23.9%) with the United States of America dominating with 22% of the share. Then comes Europe with little less than 23% of the overall world GDP and Germany, France and UK on top of the list of the best performing European countries in terms of GDP. The fourth region to contribute 8.6% to the global Gross Domestic Product is Latin America and finally comes the African region with 2.5%.
However, the list of the fastest growing GDPs of the individual countries looks completely different from the list of the states with the largest GDP shares. Guyana has recorded the fastest growing GDP in 2020 with over 43.4% growth compared to previous year. Ethiopia is another country with significant improvement in GDP showing over 6% growth compared to 2019. The list also includes Guinea with 5.2% increase, Tajikistan – 4.5%, Bangladesh – 3.8% and Egypt with 3.6% growth.
Nowadays, aggregated global wealth amounts to 418.3 trillion US dollars. 85% of the overall wealth in the world is held by 10% of the population. Out of it, 851 billion US dollars are distributed to the top 5 richest men in the world – Jeff Bezos, Elon Musk, Bernard Arnault, Bill Gates and Mark Zuckerberg.
Jeff Bezos, an American business magnate is the founder of Amazon with the current net worth of 209 billion US dollars. However, he is down 1.6 billion US dollars of his peak wealth at the moment. Amazon revenues have grown by 38% in 2020 reaching 386 billion US dollars thanks to Covid lockdowns urging people to shop online.
Elon Musk, already a famous public figure and often referred to as a Social Media activist, is the founder and CEO at SpaceX and CEO of Tesla Inc among many other corporations and organizations. His net worth is estimated to be 178 billion US dollars with significant growth of 6.7 billion USD since the spring 2021. His SpaceX rocket company is now worth 74 billion USD.
Bernard Jean Etienne Arnault is a prominent French art collector and a businessman. He is the CEO of Louis Vuitton SE (LVMH), which recently completed a deal with an American jewelry company Tiffany & Co for 15.8 billion US dollars. It is considered as the largest luxury brand acquisition in history. Bernard Arnault himself has a net worth of 174 billion US dollars, but as per recent estimates he could be up to 193 billion USD.
Bill Gates is probably one of the few people on earth that everyone has heard of. He is an American business magnate and a software developer, but more known as the co-founder of Microsoft Corporation. He also founded the world’s largest private charitable fund – Bill & Melinda Gates Foundation, even though he is divorcing his wife Melinda Gates now. Bill Gates’ net worth is valued at 151 billion US dollars.
The American media magnate, Mark Elliot Zuckerberg is one of the richest men on earth. He has been a co-founder of Facebook Inc since early 2004. He started developing Facebook while still studying at Harvard at the age of 19. Similar to Amazon, the Covid induced crisis has significantly affected Facebook but in a positive way. Mark Zuckerberg now is estimated to be worth 139 billion US dollars.
Money in the world
At the moment, the combined value of all the money in the world is worth 95.7 trillion US dollars. Out of these 95.7 trillion USD only 7% exists in a physical form and the rest of it is digital. There are over 180 different currencies as per United Nations recognized legal tenders. However, not all of them are independent or free floating currencies. The free floating currency pairs usually make the best Forex assets, whereas pegged currencies are usually less attractive and almost never actively traded on the market.
Many of the individual currencies are pegged to major currencies like the US dollar and Euro. There are 22 currencies pegged to USD with a fixed rate among which are Belize dollar, Hong Kong dollar, Maldividan rufiyaa, Netherlands Antillean guilder, Qatari riyal, Saudi riyal and the United Arab Emirates dirham.
Euro is another widespread currency in circulation which has several other currencies pegged against it. In total, 11 different currencies have fixed rates on Euro exchanges. Majority of them are European and African currencies including Bosnia and Herzegovina convertible mark, Bulgarian lev, Cape Verdean escudo, Central African CFA franc, West African CFA franc, CFP franc, Comorian franc, Croatian Kuna, Danish Krone, Moroccan dirham and Sao Tome and Principe dobra.
No one is surprised to witness spiking inflation rates for 2020 or 2021 economic years in various countries. The Covid-19 pandemic has hit the individual economies of states hard, hurting both public and private sectors. However, even without pandemics some countries have been struggling a lot, like Venezuela. Since 2016, the inflation rate of Venezuela has increased by 53,798,500%. Many countries in African and Middle-East region have inflation rates exceeding 50%, while the lowest inflation countries (below 0.2%) are mostly found in North America and European regions.
However, in April CNBC released alarming statistics according to which the Consumer Price Index in the United States has recorded the sharpest rise since the September 2008 financial crisis. Biggest price rises were apparent in Oil and Energies industries with energy pricing hitting 25% increase compared to last year (49.6% increase on gasoline and 37.3% on fuel). Car prices have also gone up by 21% even on used vehicles. The price of a variety of commodities were also significantly affected. The lumber prices recorded 124% increase since 2020, while copper jumped as much as 36%.
The very first target of every single economic or global financial crisis is the stock market. Almost every economic turmoil was accompanied by major stock crashes like the Wall Street Crash of 1929, Black monday crash of 1987, etc. Hence, investors feared that Covid-induced instability in the economic and financial markets would eventually hurt stocks and indices markets eventually. But, fortunately for them, none of it happened. The current value of the global stock market is 95 trillion US dollars. In fact, the value has increased by more than 5 trillion US dollars since the end of 2019.
However, the largest share of that market value is a responsibility of the United States stock market. The two of the most popular US stocks and exchanges – NYSE and NASDAQ comprise a total of 54.5% of the entire stock market worth. Those are the largest stock exchanges worldwide by market capitalization. NYSE is worth over 24.4 trillion US dollars, whereas NASDAQ is worth 20.9 trillion USD. Then comes the Shanghai Stock Exchange (SSE) with a value of 7.63 trillion USD, Hong Kong Exchanges and Clearing Limited (HKEx) with 6.87 trillion USD, Japan Exchange Group (JPX) with 6.71 trillion USD, and Euronext N.V. with 5.85 trillion USD value.
Biggest Companies Globally
The world’s largest companies, as measured by market capitalization, span a range of industries, from ecommerce and tech devices to oil and retailing. Regardless of the circumstances, each company is a dominant force in its field. The COVID-19 pandemic has affected each of these companies in different ways, but some continue to thrive due to their unique advantages as millions of consumers seek shelter.
The largest company globally is Apple with a market capitalization of 2.419 trillion US dollars. Specializing in consumer electronics, computer software, and online services Apple became the very first publicly traded U.S company to exceed the market cap of 2 trillion US dollars. The seven out of ten largest companies are from the United States, two are Chinese and one is a Taiwanese company.
Below is the list of the largest companies by market cap in different countries:
- Canada – Shopify with market cap $189.67 B
- US – Apple with market cap $2.419 B
- Mexico – Walmex with market cap $57.01 B
- Brazil – Vale 1VALE with market cap $117.09 B
- Sweden – Atlas Copco with market cap $12.14 B
- Poland – PKO Bank Polski with market cap $12.18 B
- Germany – SAP with market cap $170.26 B
- Italy – Enel with market cap $96.53 B
- France – LVMH with market cap $409.09 B
- Spain – Inditex with market cap $105.58 B
- Switzerland – Nestlé with market cap $353.71 B
- UK – Astrazeneca with market cap $178.58 B
- Saudi Arabia – Saudi Aramco with market cap $1.857 T
- Turkey – İşbir Holding with market cap $37.38 B
- China – Tencent with market cap $594.53 B
- India – Reliance Industries with market cap $185.27 B
- Taiwan – TSMC with market cap $602.35 B
- Australia – BHP Group with market cap $202.88 B
- Japan – Toyota with market cap $253.42 B
- Samsung – Atlas Copco with market cap $83.20 B
- Russia – Gazprom with market cap $92.62 B