For example, a fall of 30% in US share prices results in a cumulative negative impact of over 3½ percent of GDP over the same three year period. There would also be a negative impact on consumer prices of a little over ½% over three years. The different impacts stem largely from the lower extent of share ownership in Europe than in the US.
Although direct share ownership is gradually spreading in Europe, it remains considerably less widespread than in the United States. In addition, market capitalisation as a percentage of GDP is around 70% higher in the United States than in Europe. House prices are the other major component of household wealth.