Globalization of the Equity Markets

Put simply, the Exchange must position itself for a turn-of-the-millennium environment shaped, in part, by three powerful forces. First, we are as impacted as any other institution by the current changes in the economics and engineering of telecommunications and computational capacity. Second, enterprises in the more free-market industrial democracies, as well as those in more state-oriented countries, are turning to the use of equity finance at a pace that is unmatched in history. Third, two of our most important constituent groups, the fifty-one million U.S. retail investors and the ten thousand U.S. institutions with significant equity exposure, are going through a one-time, secular shift in their approach to ownership of non-U.S. equities.

When this process levels out, reaching some more appropriate geographical balance for the typical U.S. equity portfolio, the U.S. equity markets and their customers will not be as they are today.