How much money is in the world?

How much money exists in the world? How much actual money is there in the world?
How much money is in the world?
  1. What is Money?

    Money is the medium of exchange of goods and services. The money exchange is imperative not merely for an individual’s personal strength but also the countries economy.

  2. Different types of money

    Before we get to know how much money exists in the world, it is vital to know the different types of money, which is classified as ‘M’s- [M0 (the narrowest) to M3 (the broadest)]. Moreover, The Federal Reserve System of the United States of America has published data on three monetary-

    • M0- This category includes all coins, notes, and bills; representing all the physical currency in circulation
    • M1- It includes all the money present in the M0 money supply. It also consists of all demand deposits, negotiable order of withdrawal, all checkable deposits, and traveller checks. In a nutshell, M1 consists of all the assets that can be effortlessly liquidated into cash.
    • M2- This classification of money includes all the elements coming under M1, mutual funds, money market securities, saving deposits, fixed, and other deposits. Assets that are classified under this category are not easily liquidated but only used as an exchange medium.
    • M3- M3 holds all the elements of M2 along with short term repurchase agreements, large certificates of deposits, and institutional money market funds. This category is the least liquid among all other varieties of the money supply.
  3. How much money exists in the world?

    The answer is not definite as it will immensely depend upon what all categories of money supply you are including.

    3.1 Combining all the forms of investments, cryptocurrencies, and derivatives [M3], the total money was estimated to be $1.2 quadrillion; if you are not familiar with quadrillion, let’s write this amount in numerics- $1,200,000,000,000,000.

    3.2 If you only include the broad money [M2], the amount comes to be $90.4 trillion.

    3.3 Including all the money deposits in savings and checking accounts, and the physical money (notes and coins) [M1], the figure is estimated at $34 trillion.

    3.4 The money currently in circulation (M0) was calculated to be $1.7 trillion across the world

  4. What is the Gross World Product?

    In 2017, as per the Central Intelligence Agency, the GWP was calculated at $127.8 trillion in terms of purchasing power parity.

  5. How much money is there in the stock market?

    The worlds leading tech giants, including Apple, Microsoft, Amazon, and Alphabet, contribute immensely to the stock market. The total money in the stock market is estimated at $74 trillion. However, the total value of cryptocurrencies is $260 billion, whereas investment in commercial real estate is roughly calculated to be $30 trillion.

  6. Future of money

    In contemporary times, physical money usage has become minimal as the transactions are becoming more digital, and everything is operated from mobile phones and laptops. It is still to be seen whether the central banks of the different countries will adopt ways to control digital money. On the contrary, cryptocurrencies and bitcoins are putting central banks in an unlikely situation to go digital or not.

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