One Trillion

One trillion is an enormous amount of money, no matter which way you slice it. The U.S. economy, the world’s largest for a single country, is worth approximately $16 trillion – so $1 trillion divided by $16 trillion is 6.25%. So, outside of curiosity, why are we examining the dollar amount of $1 trillion.

Global dividends paid out to stockholders surpassed $1 trillion in dividends for the first time in 2013. U.S. dividend payouts have increased by 49% over the last (5) five years and account for one-third of the entire global dividend pot, totallin $301.9 billion of dividends paid. The top 10 largest dividend payers globally accounted for 10% of all dividends paid out around the world — oil and financial firms dominate the top 10. Shell, Exxon, and Mobil top the list, and other participants include Apple, Time Warner Cable, HSBC, and Banco Santander also making appearances.

This is all wonderful for shareholders of these firms, but there is another side of the issue that needs to be discussed as well. If firms are spending trillions (literally) on dividends, and even more on share buybacks, are they able to invest for future business opportunities? It has been argued by some that this increase in dividends and buybacks is merely financial engineering that is preventing firms from making the capital expenditures that are critical to future growth and profitability.

Let’s look at a few of the things you can buy with $1 trillion:

• 140 billion hours of labor in the USA.
• 18 million new teachers and pay them for the entire year.
• Be able to spend $1 million a day for the next three millennia.
• 5.5 thousand US average homes

Happy Reading!

http://www.cnbc.com/id/101439236

http://www.moneynews.com/investinganalysis/global-dividends-1-trillion-henderson/2014/02/25/id/554583

http://www.thefiscaltimes.com/Articles/2014/02/24/Global-Dividends-Surpass-1-Trillion-First-Time