As of September 2009, the total amount of physical paper bills and coins throughout the world is approaching US$4.5 trillion. The following figure indicates the countries and monetary unions included in this analysis.
Three of the five monetary unions are clearly seen above. The remaining two are the IEOM which uses the French Pacific Franc in three member countries, and the East Caribbean Currency Union which uses the East Caribbean Dollar in eight member countries.
The following graph shows the growth of global money supply since 1971, a year selected for the reason that the last remaining currency to be convertible to gold (the US dollar) was made inconvertible on August 15, 1971.
Since 1971 the total value of global currency in circulation has been increasing at a rate of 9.09% compounded annually.
The four largest currencies (EUR, USD, JPY and CNY) comprise nearly 75% of all circulating banknotes and coins within the public domain.
Country/Union
Currency Code
Amount (Billion US$)
Percent of all Circulating Currency
European Union
EUR
1067.6
24.00%
United States
USD
862.3
19.39%
Japan
JPY
805.4
18.11%
China (Mainland)
CNY
539.7
12.13%
India
INR
144.7
3.25%
Russia
RUB
116.4
2.62%
United Kingdom
GBP
89.0
2.00%
Canada
CAD
49.9
1.12%
Brazil
BRL
46.5
1.05%
Switzerland
CHF
42.9
0.96%
Poland
PLN
41.1
0.92%
Australia
AUD
38.4
0.86%
Mexico
MXN
35.3
0.79%
South Korea
KRW
27.1
0.61%
Taiwan
TWD
26.8
0.60%
Hong Kong
HKD
23.8
0.53%
Others (87)
-
490.8
11.04%
Total
4447.7
100.00%
It is apparent that the quantities of money are increasing in an accelerating fashion. In 1990, the total amount of currency in circulation passed US$1 trillion. Twelve years later, the total amount exceeded US$2 trillion. This doubled again less than six years later in early 2008.
The author is of the opinion that these substantial increases to the amount of circulating currency will ultimately lead to decreased purchasing power.
Mike Hewitt
Editor
DollarDaze.org
Also by Mike Hewitt
Mike Hewitt is the editor of www.DollarDaze.org, a website pertaining to commentary on the instability of the global fiat monetary system and investment strategies on mining companies.
Disclaimer: The opinions expressed above are not intended to be taken as investment advice. It is to be taken as opinion only and I encourage you to complete your own due diligence when making an investment decision.
© 2007 DollarDaze
