By Mitchell Hartman, Marketplace.org From Business Insider

The US dollar is the most popular currency in use worldwide.Steve Marcus

According to the Bank for International Settlements, the total amount is about $5 trillion.
According to the CIA, the total amount is $80 trillion if you include “broad money.”
The US dollar is the most popular currency in use worldwide.

Listener Elizabeth Masten, from Norfolk, Virginia, asked Marketplace this question:

I’m curious as to how much money is out there in the world? Does anybody keep records as to how much money the world has?

Jacob Kirkegaard, senior fellow at the Peterson Institute for International Economics, said one part of the answer can be found in information published by the U.S. Federal Reserve.

“It’s a number called M0, which is essentially the number of notes and coins in circulation,” Kirkegaard said. “For the United States, that number on the Federal Reserve website is somewhere in the vicinity of $1.5 trillion.”

Kirkegaard said that a comparable tally of currency in circulation from all over the world, tracked by the Bank for International Settlements, totals about $5 trillion.

But using a more inclusive definition of money, “that amount goes much, much higher,” explained Jeff Desjardins at the financial media website Visual Capitalist, which has published an infographic on the topic.

“Add in checking accounts, savings accounts, money-market accounts — not quite physical money, but you can make a bank transaction digitally and use that as money,” and Desjardins said the total amount of money easily accessible in the world economy grows by several multiples. This is called broad money, and according to the CIA World Factbook, and the global total is in excess of $80 trillion.

Most of the broad money in the world economy isn’t actually cash held in bank vaults, explained Karen Petrou, managing partner at Federal Financial Analytics. It’s bank balances on digital ledgers, money that people deposited in banks, and banks then lent out again.

“Banks always have your money out working in the economy,” said Petrou. “If everybody lined up and suddenly went to the bank to get cash, you’d have a classic banking run.”

Petrou said the U.S. dollar is the most popular currency in use worldwide — for countries’ central-bank reserves, wealthy people’s cash holdings, and criminal enterprises.

Because of the stability of the United States, “it’s the most liquid currency,” said Petrou. “As a global store of value and safety, it’s one of the most important assets this country has.”

Read the original article on Marketplace.org. Copyright 2017. Follow Marketplace.org on Twitter.
IMAGE: Stacks of cash and the World Series of Poker championship bracelet are placed on a table after Germany’s Pius Heinz and the Czech Republic’s Martin Staszko emerged as finalists during the WSOP main event at the Rio All-Suite Hotel and Casino in Las Vegas November 8, 2011.

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