The US stock market capitalization to GDP ratio is at an impressive 187%. Although it still remains below the record of 199% in 2021, the 40% growth rate in just two years makes us cautious.
Nominally, the total capitalization of the US stock market is approaching its all-time high of $53 trillion, which underscores the presence of the US market at the forefront of growth compared to other countries’ markets. For comparison, the ratio of global stock market capitalization to GDP (excluding the US) is only 61%.
Another illustrative ratio is the gold price to the S&P 500 index, which currently stands at 0.45. This contrasts sharply with the ratio of 1.69 during the debt ceiling crisis in August 2011 and the staggering ratio of 2.75 in August 1979, when Paul Volcker became Fed chairman during the stagflation crisis. Gold would be worth more than $14,000 an ounce if today’s ratio were the same as in 1979.
Do you think we should expect a crisis in the next 5 years?
submitted by /u/dll_crypto
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