http://profitableinvestingtips.com/stock-investing/why-is-the-stock-market-shrinking Why Is the Stock Market Shrinking? There are fewer stocks listed on public stock exchanges than there used to be. Why is the stock market shrinking? According to USA Today investors are worrying about the shriveling size of the market. The stock market is shrinking fast. There are now fewer stocks for investors to choose from than in 1979, leaving 401(k) plans, investment plans and other investors with fewer options from the market. Just 3,659 stocks trade on public markets available to investors, based on the Wilshire 5000 Total Market Index through August, the latest data available. That’s down 3.1% from 2015 and half the number of actively traded stocks available than at the peak in 1997, Wilshire says. The Wilshire 5000 is an index designed to track the stock market’s entire value. According to USA Today new companies are not going public but rather looking for other ways to raise money. Why is that? And what will the effects be? Buyouts Buyouts and mergers reduce the number of stocks available to investors. Business Insider writes about the agricultural merger mania and its effects on smaller operations. The U.S. Justice Department is looking into concerns that global consolidation among major seed and agricultural chemical companies may squeeze supplies of the building blocks for widely used genetically modified seeds, a farm group told Reuters. The department has asked the American Soybean Association for details about how small and independent seed companies license seed traits from developers, said Steve Censky, chief executive of the association. The federal inquiries started after Dow Chemical said in December that it would seek to merge with DuPont in a $130 billion deal. In recent months, department officials have also asked how farmers select seeds, Censky said. Small seed operations are making an argument that mergers will hurt the seed stock. Investors should make the argument that with fewer stocks to choose from it hurts the market.

1. By www.ProfitableInvestingTips.com

2. There are fewer stocks listed on
public stock exchanges than there
used to be.

3. Why is the stock market
shrinking?

4. Before We Continue…
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5. According to USA Today investors
are worrying about the shriveling
size of the market.

6. The stock market is shrinking fast.
There are now fewer stocks for
investors to choose from than in
1979, leaving 401(k) plans,
investment plans and other
investors with fewer options from
the market.

7. Just 3,659 stocks trade on public
markets available to investors,
based on the Wilshire 5000 Total
Market Index through August, the
latest data available.

8. That’s down 3.1% from 2015 and
half the number of actively traded
stocks available than at the peak
in 1997, Wilshire says.

9. The Wilshire 5000 is an index
designed to track the stock
market’s entire value.

10. According to USA Today new
companies are not going public
but rather looking for other ways
to raise money.

11. Why is that? And what will the
effects be?

12. Buyouts

13. Buyouts and mergers reduce the
number of stocks available to
investors.

14. Business Insider writes about
the agricultural merger mania and
its effects on smaller operations.

15. The U.S. Justice Department is
looking into concerns that global
consolidation among major seed
and agricultural chemical
companies may squeeze supplies
of the building blocks for widely
used genetically modified seeds, a
farm group told Reuters.

16. The department has asked the
American Soybean Association for
details about how small and
independent seed companies
license seed traits from
developers, said Steve Censky,
chief executive of the association.

17. The federal inquiries started after
Dow Chemical said in December
that it would seek to merge with
DuPont in a $130 billion deal.

18. In recent months, department
officials have also asked how
farmers select seeds, Censky said.

19. Small seed operations are making
an argument that mergers will
hurt the seed stock.

20. Investors should make the
argument that with fewer stocks
to choose from it hurts the
market.

21. Fewer IPOs

22. It used to be that when a company
got to a certain size and had
prospects for growth that it issued
stock in order to raise more
capital and reward those who had
started the company.

23. But there have been fewer IPOs as
companies have sought funds
elsewhere.

24. This means that investors can be
a little crazy when there are new
IPOs, especially in the tech sector.

25. Bloomberg writes about
current tech IPOs.

26. I never imagined I would write this
sentence:

27. Technology IPO investors have
gone almost as crazy as the
private financiers throwing wads
of money at tech “unicorns” like
Uber.

28. There have been so few
technology companies braving the
public markets this year that
investors are pouncing on the tiny
handful of fresh listings like
hungry wolves.

29. They are driving up stock
valuations to overheated and
potentially unsustainable levels
for many new public companies.

30. In fact, a rational explanation for
the currently overvalued market in
general might just be that we have
too many investors chasing too
few stocks.

31. Private Ownership Means
Private Control

32. When Michael Dell took back the
company that he founded it took
it private.

33. This allows the owners to do when
they want without being
answerable to shareholders or for
that matter to takeover artists who
demand a rapid return on their
invested capital regardless of the
intrinsic value of the company.