MONEY might not literally make the world go round – but it is the most vital commodity in any economic system.
Often divided into those who save and those who spend, money often means more power, choice and comfort.
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How much money is there in the world as of 2020?
There is currently around $36.8 trillion in its simplest circulating form, known as ‘narrow money’.
This includes notes, coins, as well as the value of ‘easily accessed’ funds like current accounts.
But this figure reaches a staggering $90.4 trillion if you consider ‘broad money’, which includes savings, ISAs or fixed-term accounts.
The worldwide amount of money has been valued at around $215 trillion, while property is at $217 trillion.
And the figure gets even more incomprehensible if you consider the derivatives market – which includes stocks, bonds, commodities, currencies and index rates.
At the low end, financial experts estimate this is worth $630 trillion.
At the high end, it’s $1.2 quadrillion, or 1,000 million million, or $1,200,000,000,000,000.
Therefore if every person in the world was given an equal share of that staggering number, everyone would receive around $154,000 (equal to around £114,000).
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Who decides how much money is in the world?
The main controller of money supply is the central bank of each country.
Central banks like the Bank of England can increase or decrease the proportion of deposits that commercial banks must keep on reserve.
They may also inject cash into the market as well as increase or decrease the interest rate at which it lends money to commercial banks.
Higher interest rates discourage people from borrowing, and they therefore spend less.
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In the UK, the amount of currency in circulation alters by public demand.
For example at Christmas, more money is needed by the public as they withdraw cash from their bank accounts.
Physical currency now accounts for less than 10 percent of all money.
Contactless card payments have soared in the past several years and may one day replace tangible cash.
How much money is in the UK?
The United Kingdom has a $2.83 trillion (£2.1 trillion) GDP, and is the sixth largest economy in the world.
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In comparison, the US is the world’s largest economy at $21.44 trillion GDP.
China is second at $14.14 trillion GDP, with Japan in third ($5.15 trillion GDP) and Germany in fourth ($3.86 trillion).
Meanwhile, India overtook both the UK and France as the fastest growing economy in the world, and has a $2.94 trillion GDP.
