初中英语九年级学习方法globalcapitalmarket

1、Why has the global capital market grown so rapidly in recent decade s?Will this growth continue through? Dictionary of Business defines the capital market as a market in which long-term capital is raised by industry and commerce, the government, and local authorities. Th e money comes from private i

2、nvestors, insurance companies, pension funds, and bank s and is usually arranged by issuing houses and merchant banks. Stock exchanges are also part of the capital market in that they provide a market for the shares and loan sto cks that represent the capital once it has been raised. It is the prese

3、nce and sophisticati on of their capital markets that distinguishes the industria l countries from the develop ing countries, in that this facility for raising industrial and commercial capital is either absent or rudimentary in the latter. The global capital market has grown so rapidly in recent de

4、cades. So I would lik e to discuss about it in the essay. This essay is organized as follow, introduction, body, conclusion. In the body par t, Section 1 shows why has the global capital market grown so rapidly in recent decad es. Section 2 talks about the continuance of the growth throughout the 20

5、00s. Body 1. Why has the global capital market grown so rapidly in recent decades In recent decades, the global capital market has grown so rapidly because of the rise o f privatizations mainly. With private capital flows rising from less than 5 percent of w orld GDP in 1975 to about 20 percent toda

6、y, privatizations have significantly increase d market liquidity. And also privatization takes a potential role global capital market d evelopment. A. The Rise of Capital Market-Based Finance Capital market-based finance has in fact been increasing in importance, both abs olutely and relative to fin

7、ancial intermediary-based finance, in both developed and de veloping countries over the past decade. And also capital markets are in fact winning t he present and seem likely to dominate the future of corporate finance in developed an d developing countries alike. a. The Stable Role of Commercial Ba

8、nking in Modern Economies Ordinary rela tionship banking appears to be (at best) holding its own as a source of corporate fina ncing around the world, and is more likely in decline. The bits of banking that are gro wing rapidly are those parts that provide high value-added products (especially risk

9、m anagement tools) and provide large-scale syndicated credits to corporate borrowers. D uring the late-1980s and early-1990s, when Japan and Germany appeared to be outper forming major capital market-oriented countries such as Britain and the US, the acade mic literature often favored bank-based sys

10、tems. Examples ofthis literature in clude Prowse (1992), Kester (1992), and Porter (1992), while the supporting argument s are summarized in Maher and Andersson (1999) and Tsuru (2000). More recently, h owever, the weight of opinion has swung strongly in favor of the idea that capital mar kets have

11、decisive comparative advantages over banks and other financial intermediar ies as optimal monitors and financiers of a nations corporate life. This reassessment h as been driven in part by the observation, discussed at length above, that capital marke ts have been prospering relative to banks for ma

12、ny ;years now. The repetitive nature- and massive costs-of banking crises in developing and developed countries alike has also convinced many observers that banks are inherently fragile institutions, whose rol e in corporate finance should be minimized as much and as quickly as possible (Econ omist

13、(1997, 1999). b. The Rapid Growth in Stock Market Capitalization and Trading Volume Since 1983 From 1983 to 2000, this was a period of very rapid growth in the capitalization of mar kets in every country except Japan. Total world market capitalization increased over te n-fold (to $ 35.0 trillion) be

14、tween 1983 and 1999, and the total capitalization of the U S market increased almost nine-fold (from $ 1.9 trillion to $ 16.6 trillion) over the sa me period. c. The Dramatic Growth in Securities Issuance oVlume Since 1990 Another way of measuring the rise of capital markets is to examine whether th

15、eir share of annual corporate financing activity has grown relative to that of other source s of funding. Security offerings by US issuers accounted for two-thirds of the global t otal throughout 1990-1999, that implies that non-US securities issues in creased from $ 191 billion in 1990 to $ 750 bil

16、lion in 1998, and then to $ 1.19 trillion in 1999. The surge in non-US issuance volume in 1999 was largely due to the popularity of euro-de nominated bond issues, which actually exceededdollar-denominated bond issu es for much of 1999. d. The Phenomenal Growth in Venture Capital Financing in the Uni

17、ted States One highly specialized, but extremely important type of financing has also grown ver y rapidly over the past decade, and especially so since 1997. This is venture capital in vestment by US venture capital partnerships. The fund-raising patterns of these privat e equity investors are discu

18、ssed in Gompers and Lerner (1998), and the competitive a dvantages of US venture capitalists versus those in other developed countries are desc ribed in Black and Gilson (1998). e. The Surge in Mergers and Acquisitions Worldwide The almost incredible increase in the total volume of merger and acquis

19、ition acti vity that has occurred since 1990. While takeovers have always played an important r ole in the United States, the rise in M$ 3.4 trillion, an astounding 1 0% of world GDP. Next I will document that share issue privatizations have truly transformed share ownership patterns of investors in

20、 many different countries. B. Privatizations Impact on Stock and Bond Market Development We should be careful in inferring causation regarding privatizations impact on m arket growth, since a shift in ideology or some other exogenous political or economic change might have caused both the privatizat

21、ion and the overall boom. a. Total Proceeds Raised by Privatization Programs It is clear that national governments have been among the biggest winners from p rivatization programs, since these have dramatically increased government revenues, which is clearly one reason the policy has spread so rapid

22、ly. As mentioned above, Priv atisation International Gibbon (1998, 2000) reports that the cumulative value of proc eeds raised by privatizing governments exceeded $ 1 trillion sometime during the seco nd half of 1999. As an added benefit, this revenue has come to governments without h aving to raise

23、 taxes or cut other public services. b. Privatizations Impact on International Investment Banking All international invest ment banks compete fiercely for share issue privatization mandates, for two principal reasons. First, because the offerings are so large and so visible-and are almost always des

24、igned to help promote the markets capacity to absorb subsequent stock offerings by private companies-these are very prestigious mandates. To date, the large US and British brokerage houses have had the most success in winning advisory and underwri ting mandates, though all countries that launch larg

25、e-scale SIP programs tend to favor local investment banks as national champions tohandle the domestic share tr anche. The second reason banks compete so fiercely for SIP mandates is because they can be extremely profitable. In spite of the fact-documented by Jones, et al (1999) an d Ljungqvist, et a

26、l (2000)-that SIPs have significantly lower underwriting spreads tha n private sector offerings, their sheer size and lack of downside price risk make them very lucrative for underwriters. 2. Will this growth continue throughout the 2000s? As we indicated above, the global capital market has grown s

27、o rapidly in recent decad es cause of the privatizations rise. Privatizations increased the market liquidity. Now we have already stepped into the 21st century. I believe that the growth will continue f or the following reasons. First, most of the south-east Asia countries have recovered fr om the 1

28、997 financial crisis. For these countries, they now have the capital to do busi nesses. And they get back on the fast growing track. Second, by the end of 2001, worl ds biggest developing country, China, has ;entered the WTO (World Trade Organizati on). This is real great news. As we all know, today

29、s China takes a serious position in worlds economy. Its innovation and opening policy make china keep achieving high GDP growth rate. This drives the global capital market keep growing. Summary and Conclusions This essay examines the impact of share issue privatizations (SIPs) on the growth of world

30、 capital markets (especially stock markets). I begin by documenting the incre asing importance of capital markets, and the declining role of commercial banks, in co rporate financial systems around the world. I then show that privatization programs- particularly those involving public share offering

31、s-have had a dramatic impact both o n the development of non-US stock markets and on the participation of individual and institutional investors in those stock markets. This has told the reason of the fast growth of global capital market. And then I su ccinctly indicated the continuance of the rapid

32、 growth, the great future. The last but not the least is the recommendation. I can confidently assert that, if e xecuted properly, a series of share issue privatizations can indeed promote the growth of global capital market, which will yield economic and political dividends for many years to come.

33、That means there is a need to encourage the development of SIPs in or der to gain growth of global capital market. References Dictionary of Business, Oxford University Press, ? Market House Books Ltd 1996 The Economist (April 12, 1997), Fragile, Handle With Care: A Survey of Banking In Emerging Markets. The Economist (April 17, 1999), On A Wing and A Prayer: A Survey of International Banking. Gibbon, H., 1998, Worldwide Economic Orthodoxy, Privatis