How many dollars are there? - November 25, 2018

How many dollars are there?

The dollar is the most important currency of the world, but there are many things that are not widely known about it. How much USD is out there? What denomination has the biggest volume and value? And why is it nicknamed greenback at all? We have the answers to all these questions and more!

The US Dollar is probably the most well-known currency of the world and for a good reason. It’s the reserve currency for several countries, and it’s also popular among individual investors to keep their wealth in. Although everyone knows what the USD is, there are a lot of interesting details that are relatively less known about the greenback.

How much dollar is out there?

According to the Federal Reserve (which prints the dollar) there “was approximately $1.67 trillion in circulation as of June 27, 2018”, and about 97% of that was made by the Federal Reserve. The Fed also has interesting data about the exact number of notes in circulation.

VOLUME OF US DOLLAR NOTES IN CIRCULATION IN BILLIONS OF NOTES

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It is clear from the chart above that the $1 and the $100 bill have the most in volume, closely followed by the $20 bill. But from the chart below, it can be seen that these numbers also mean that there is “only” $12.1 billion value in $1 bills, while there is more than $1.2 trillion in $100 bills. This may be surprising at first, but two-thirds of $100 bills are held outside of the US. The reason is simple: foreign reserves and traders love the dollar. That’s also the reason why the Fed needs so many of that bill in circulation.

VALUE OF US DOLLAR NOTES IN CIRCULATION

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What are these made of?

With something as important as the dollar, it’s not surprising that Fed also keeps data on the average lifespan of the bills. It would be logical to assume that the $1 bill has the shortest lifespan as it’s the least valuable, but that’s not true. The $10 and the $20 bills break first, in 5.5 and 4.5 years respectively. The $100 bill, on the other hand, has the longest lifespan, as it’s estimated to keep in circulation for 15 years.

ESTIMATED LIFESPAN OF USD NOTES

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The lifespan of the bills has nothing to do with their materials, though. All bills are made of the same fabrics and surprisingly that’s not paper. The bills are made of 75% cotton and 25% linen, with an undisclosed amount of security fibers in them. This formula is patented by the only supplier (Crane & Co.) of papers ever since 1879.

Is counterfeiting possible?

With something as valuable as the US Dollar, it’s no wonder that there are some who try to counterfeit it. The US is fighting against that with UV and 3D security ribbons, raised printing, microprinting, color shifting ink and watermarks. They often change the designs too, so it’s harder to figure out how to do counterfeits. All this doesn’t mean that there are no successful attempts. The biggest counterfeiter for example is no other than North Korea, which managed to create “superdollars” which were undetected for years.

Counterfeit bills are also as old as the dollar itself, but it’s still surprising that the USD got its nickname from fighting against it. The greenback’s green ink was used against counterfeiting, since back in the days black and white cameras were used to create copies. With green ink, that became impossible, and the color worked so well, that after standardizing the design in 1929, it remained.

Disclaimer: This analysis is for general information and is not a recommendation to sell or buy any instrument. Since every investment holds some risk, our main business policy is based on diversification to minimize threats and maximize profits. Innovative Securities’ Profit Max has a diversified portfolio, which contains liquid instruments. This way, our clients can maintain liquidity, while achieving their personal investment goals on the long term.