The total amount of money in the world: it depends on how we define what counts as money and what not.
For example, gold might not be called money, but it has a market value and is an asset. Similarly, real estate which is estimated as a 7.6 trillion investment can be included or may be not.
As we move towards a digital economy the amount of cash is decreasing, for example bitcoin value is estimated at more that 100 billion dollars,.
But that’s small if we see that Jeff Bezos alone is estimated to have a net fortune worth more than 180 billion.
How much money exists on Earth? It’s a simple question with a bunch of complicated answers.
Simply, the answer depends on how you define “money”.
Asset types that contribute to the total amount of money in the world
For the narrowest definition, or what’s called “M0”, that includes only physical money, paper bills and metal coins that constitute currency.
That figure is around 5 trillion dollars.
The next step up is M1, which includes all the physical money, plus quickly accessed money like that in checking accounts, and comes in at $25 trillion. M2 includes M0 and M1, but also pulls in stuff like savings accounts and CDs under $100,000. That figure is around $60 trillion.
And the last figure, the $75 trillion M3, is much more abstract and not often cited in official figures. It includes institutional money market funds, long term deposits, and other stuff rich people possess that can somehow be spent but confuses the rest of us.
But, well, that’s just currency. And one country’s currencies can be wiped out by war or other influences. Or inflation or deflation could change the value of the money you do have. Or a whole host of other things.
The total amount of money in the world by asset type:
- 7.6 trillion real estate investment
- 7.9 trillion the amount of gold and silver
- 70 trillion stock market investment
- 90 trillion notes and coins in circulation
- 199 trillion dollars is debt by people and countries
- 1.2 quadrillion is the amount of derivatives.
- 1,200,000,000,000,000 dollars now that’s what we call a big number.
The case for bitcoin
Digital assets such as bitcoin are currently valued at around 250 billion dollars and people like Jack Dorsey (the guy from twitter!) say that in 10 years most transactions will be made using cryptocurrencies. Now think about it this way:that’s not even 1% of the notes and coins!
Imagine how much bitcoin will be worth if in 20 years we are using crypto in just 20% of our daily lives.
Now think how many millenials aren’t yet in the investing world and i’m sure that when they do, they won’t care about gold or silver.
Some analysts predict bitcoin will reach $100000, i don’t find that crazy at all. Think what you like but i’m buying crypto every month.