Friday, January 12, 2007

World's financial assets valued at $140 trillion

Thanks to Barry Ritholtz at the Big Picture for highlighting this story from the Wall St. Journal.

From, "World's assets hit record value of $140 trillion":

The world's financial system is overflowing with stocks, bonds and other financial assets -- $140 trillion worth, to be precise.

The figure was released in a study by McKinsey & Co. that maps financial assets around the globe and seeks to track the flows of these assets as they move from one region to another, putting hard numbers on the oceans of capital washing up around the globe.

At $140 trillion in 2005, the value of the world's financial assets hit a new peak and was more than three times as large as the total output of goods and services produced across the planet that year.

The study, released today, paints a picture of a world in which investors and the banks that manage their money are spreading their bets more broadly. Flows of investment across borders hit $6 trillion in 2005, McKinsey said, above levels reached at the height of the 1990s stock-market bubble and more than double the figure in 2002.

The article points out that the U.S. currently takes in 85 percent of all financial flows from countries that are net exporters of capital. And hey, there's a cool little graphic to illustrate this point as well.

What will this chart look like ten years from now?