Wealth of World

If someone has enough money and wants to buy the entire earth.  How much he has to pay in dollars?  In another word, how much the world is worth today? 

$195 trillion dollars! 

That is the total worth of all the nations on earth in 2010.  The richest man on earth is either Carlos Helu of Mexico or Bill Gates of USA depending on how their stocks are faring.  Each of them has a total wealth around $55 billion dollars, nowhere near to the $195 trillions for the total wealth of world.  So we do not have to worry any human beings can afford to buy the entire earth yet.  Nevertheless, the world does have a limited wealth that can be valued.  The wealth is generally calculated by adding the real estate values and financial assets including bonds, stocks, cash, saving, and other marketable valuables, and subtracting the total debts such as mortgages and all other loans.

Although there has been a significant drop in the world total wealth from 2008 to 2010 due to the worst financial crisis that plunged both real estate values and stock markets around the globe, the world still manages to gain about 20% in total wealth since 2005.  European Union is the largest economy with almost one third of the world wealth, i.e., 33%.  USA is taking more than a quarter of the total world wealth, 28%.  The number two and three largest GDP nations, China and Japan, have another combined 20% of world wealth.  That leaves only 20% of world wealth sharing by the rest of more than 150 countries around the world.  The rapid economic growth in China and the stable economic recovery of USA and European Union will accelerate the world wealth growth rate in the next five years.  The world total wealth is expected to grow 60%, reaching $315 trillion dollars in the year 2015.  Not surprisingly, the contributing share of China and other emerging economies in the world total wealth will increase accordingly.

Whereas no rich people can afford to buy the entire earth today, the riches around the world still own most of the world wealth.  The statistics showed that top 8% of the world population controls 80% of the world total wealth.  Putting these into actual numbers, about 50 millions out of 6.8 billion people on earth own the wealth of $155 trillion dollars, or more than $3 million dollars for every rich people.  On the contrary, 6.75 billion people on the earth are sharing the remaining $40 billion dollars of wealth.  That was a miserable $6 dollars for every non-rich people.  Between rich and poor, the difference is an astonishing 500,000 times.

Like most advanced economies, the national wealth of United States is primarily consisted of financial assets in stocks, bonds, gold and other marketable assets.  The real estate or housing is worth only about half of these financial assets.  Moreover, USA carries a significant load of debts, around 20% of national wealth today.  For the emerging economies, such as China, the real estate assets contribute more than half of the total wealth.  Real estate wealth in other emerging countries can contribute even a much higher ratio to the national wealth.  However, the extremely low debt ratio of 3% for China is unique only to China.  Most of the advanced and emerging economies have a high debt ratio that can sometime surpasse its entire national GDP.

Knowing this, no one would like to buy the earth anymore.  However, China still seems a very attractive nation to buy. 

There are a lot of riches actually buying now!