Another bullish trend is the recent private equity funds taking public companies private. If this continues, then the "supply" of public companies will decline - making the available share worth more.
I would think that the effect of that would be marginal unless there are thousands of them going private at once.
It isn't the number of companies - it is the magnitude of the deals that matters. Well over $100 billion in deal in 2006 - that mean $100 billion worth of fewer shares available for traders. Every little bit counts when you are talking billions.
I haven't seen much megacaps, or largecaps for that matter, go private; it's usually nanocaps and microcaps that get delisted.
Delisted? Who said anything about delisting? All I can say is $133 billion in deals in 2006 is a heck of a lot of nanocap and microcap companies.
I mentioned delisting because it has the same effect as withdrawing. Anyway, $133 billion is an extremely small number considering that it is out of trillions.
Here are some of the microcap stocks you may not be familiar with that have gone private: Equity Office Properties Trust - $39 Billion Hospital Corp of America - $32 Billion Harrah's Entertainment - $27 Billion Clear Channel Communications - $25 Billion Kinder Morgan - $21 Billion Freescal Semiconductor - $17 Billion Albertson's - $17 Billion Hertz - $15 Billion TDC - $14 Billion All in the last three years.
I think its time we really start looking at who our investors are and how they can effect us...this drop was mainly due to the chinese selling off of american goods...why can't americans invest in america anymore??
More Americans are invested in the stock market today than any other time in history and the direction of the trend continues in that positive direction. The drop was mainly due to a computer error at 3:00 PM where the DJIA was mis-calculated making it appear to drop 200 points in a few seconds. Look - the markets were priced for perfection at the time - any little stress on the system was going to put pressure on prices in the very short term. Long term - the markets rule!
That's it? Google alone grew enough to make those withdraws meaningless. IPOs are more common than withdraws anyway. The "supply" of companies is not going to go away fast enough in order to have an actual impact on the market.
It was obviously an exaggeration. If you honestly think that withdraws have an impact on Wall Street, go ahead. And for crying out loud, the market didn't suffer mainly because of a glitch of any sort; it was getting punished before 3 PM. Look at the SSE Composite Index. There's your main reason.
I don't think - I know: http://www.metrics2.com/blog/2007/01/08/buyout_byproducts_to_produce_big_ipos_global_ipos.html The NYSE saw a NET withdrawal of listed capital of $38.8 billion NASDAQ had a NET withdrawal of $11 billion In 2006 ALL of the US IPOs accounted for $41 billion - compared to $133 billion in private equity deals. Is this making more sense now?
However, the numbers show that withdraws outnumber IPOs in $$$ by 3 to 1. And yes, even with $15 trillion in market cap in the US, I would say a NET movement of $100 billion a year out of the markets into private hands is worth noting.
I was referring to Chinese investors dumping stocks suck as Caterpiller...they were the biggest loser on wednesday...
Thats nothing compared to over $100Billion dollars Exxon Mobil gained. I mean seriously, 100B out of 15T is .6%. If I only earn .6% on my money, I'm not going to be a happy camper.
XOM rose in price, thus increasing its market value - not by adding additional shares to the market place - thus diluting the value of present shares. Oh well - I give up! Regardless - I am bullish on the US and the US markets in the long-term.