Tuesday, August 18, 2015

Why TPP Is Important To Both Japan and the US?

Other than China, the three key world economies, and by a huge amount, are that of the US, Germany and Japan.

Having lived in Germany for a year and having worked with the people of Germany and Japan for many years in a former job, I always thought that Germany and Japan were fairly similar in economic size.  And they both are superb advanced manufacturing giants.

But in researching the publicly-traded companies, I surprisingly discovered that Japanese companies flat out swamp German companies.

There are a bit over 199 Japanese companies with stock market capitalizations of more than 600 bil yen.  Based on current exchange rates, that 600 bil yen equates to US$5.1 bil.

And also using current exchange rates, US$5.1 bil equates to EUR 4.6 bil.

So how many German companies have stock market caps of more than EUR 4.6 bil?  A bit more than 52.

Yeah that's right, the ratio of Japanese publicly-traded companies to German ones above the same market cap size is a massive 3.83 Times.

That's the main reason why the TPP is critical to both Japan and the US.