In the next 10 years, how many bank notes will the largest central banks in the world print?
Today we will discuss the issue of “Money” and “Property” around the world!
Below are the figures that I have obtained through IMF (International Monetary Fund), BIS (International Accounting Bank) and many other sources to make a pyramid diagram back to the elite. “And different” Assets “globally (comparison between 2017 and 2018).
1, The bottom bottom of the inverted pyramid chart is the Base currency created by central banks.
This is the first class of currency, with the current global total amounting to approximately US $ 25 trillion. In which 6 major central banks of the US, Europe, China, Japan, England and Sweden have printed more than 20 trillion US dollars.
2, Up to the 1-floor bottom floor is a strong currency (High-powered money) derivative, equivalent to about 96 trillion US dollars.
Of which five major central banks of the US, Europe, China, Japan and the United Kingdom accounted for 70 trillion US dollars, China alone accounted for more than 27 trillion US dollars.
3, The next floor above that is the total amount of credit bonds issued globally, about 110 trillion US dollars. In theory, these bonds can be used as collateral and used in the financial system.
In particular, the US bond market accounted for more than 42 trillion US dollars. The three major economies of China, Europe and Japan combined are more than 40 trillion dollars.
4, Top next floor is total global debt. This includes debt of both economic entities and financial institutions.
The total scale is about 247 trillion US dollars, of which 5 major economies America, Europe, China, Japan and the UK together account for over 80%.
These debts can also be considered as money to transfer and mortgage on a certain level.
5, The top floor is the largest “Money”, a derivative of assets such as bonds, stocks, real estate, credit loans … that can be traded, can be considered as money assets. Its total value is 544 trillion US dollars.
That’s 5 layers of “Money” that I have summarized.
A problem worth considering here is:
Global GDP in 2017 is US $ 76 trillion, about 3 times the total amount of cash that the central bank of the printing countries (US $ 25 trillion).
Global GDP in 2007 was US $ 58 trillion, 14.5 times the current base amount of US $ 4 trillion.
This is at least enough to prove one thing: in the last 10 years, banks of producing mothers print too much money. If banks print money to stimulate the economy, now the marginal effect of printing US $ 1 for economic growth has become increasingly low and cannot continue!
Next, we will observe the types of assets that can be invested and its scale globally
We often assume that large types of assets include real estate, bonds, stocks, gold, general goods (including grains, energy, metals …) and all kinds of other assets (diamonds, antiques …).
In addition to the traditional large asset types, new types of assets, such as cryptocurrency, have also become an important asset.
According to the relevant data collected, the scale of the major global asset types is as follows (units are US dollars-USD).
1, REAL ESTATE
By the end of 2017, the total value of global real estate was 281 trillion US dollars, including residential housing, commercial business land and agricultural production land, accounting for 74:13 respectively: 13.
Bonds are standard forms of borrowing, it can also be a currency and can also be a type of asset. The total value of its assets as mentioned above is about 110 trillion, of which government-issued bonds have exceeded US $ 60 trillion, accounting for 50%.
As of the end of 2017, the total market value of the global stock market is about US $ 78 trillion, equivalent to the global GPD level. Of which, the US alone accounted for about 30 trillion US dollars.
3, GOLD AND SILVER
Total asset size is about US $ 8 trillion, of which 95% becomes all gold market value.
4, GENERAL GOODS
General goods are types of goods that consumers and consumers consume. Usually they are not considered a type of investment, so it is difficult to find and measure its overall scale.
If assessing the 1-year output of general goods for its market size, it can be confirmed that the highest proportion of goods in the general commodity market is oil. rough.
Its daily consumption amounted to 98 million barrels, according to the current WTI crude oil selling price of US $ 70 per barrel, equivalent to a market size of US $ 25 trillion. Coal and natural gas are roughly equivalent to the size of the crude oil market.
In contrast, global food production is about 2 billion tons per year, but the total value is only about 400 billion US dollars; The total value including 1-year output of metals such as iron and steel, copper, aluminum … is about 450 billion USD.
5, ELECTRONIC ELECTRONIC ENCRYPTION
As of July 2018, the total market value of the cryptocurrency market is about US $ 290 billion, of which Bitcoin accounts for nearly half of the market share.
6, OTHER ASSET TYPES
Total diamond sales in 2017 were $ 12 billion, 2016 public auction sales of global antiques were $ 12 billion, $ 400 million, totaling less than $ 30 million.
The scale of asset types is shown in the following chart (No evaluation of general goods):
The largest asset globally is real estate, totaling as high as 281 trillion dollars, higher than the total volume of other assets combined.
The total value added of real estate in the last 3 years has always accounted for the highest proportion, the total value of real estate industry in 2016-2017 globally increased rapidly, in which China has the largest contribution.
The three major types of assets are real estate, bonds and stocks, which have experienced rapid and rapid growth compared to the world GDP growth rate in recent years. But the consumer price index CPI that the government shows is very small.
Considering that in the past 10 years, the central bank’s cash printing scale has increased dramatically, which clearly shows that the central bank’s money printing is to raise asset prices. In which the housing is the most profitable, the second boss stock and then the bond.
In contrast, silver and gold have always been regarded as standard value items for thousands of years, when considered a asset, its value in the last 3 years has hardly grown at all.
Could it be that central banks and government agencies can print money forever?
Could central and government banks make the selling prices of credit assets such as real estate, bonds and stocks continue to escalate and the selling prices of everyday consumer goods and gold are always high? maintain at the old level?
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