The $200 Trillion World: Who Owns All the Wealth?

The wealth of the world -- from all the global stock markets, insurance funds, and families -- comes out to about $200 trillion, according to the McKinsey Global Institute's new report on investors in developing nations. Who owns all that?

Households, mostly. U.S. and Western European households own about one-quarter of the world's financial assets, according the rather remarkable chart produced by the authors, which breaks down wealth by type and geography. Here is that chart:

And for those of you who prefer to compare big numbers visually, here is the right column broken down by percentages and organized as a pie graph.

And now with the numbers (all in trillions):

McKinsey's headline finding:

Until this decade, the preferences of investors in developed nations have shaped the evolution of global capital markets. Today these investors control 79 percent of the world's nearly $200 trillion in financial assets.

Broadly speaking, investors in developed economies hold highly diversified portfolios, with significant portions in equities. The United States stands out for consistently high equity allocations: currently US households have 42 percent of their non-retirement financial assets in publicly listed shares. Households in Hong Kong have similar shares of their wealth in equities. On average, Western European households placed 29 percent of their financial assets in equities in 2010, with 29 percent in the United Kingdom (down from 45 percent in 2000), 25 percent in France, and 19 percent in Germany.

Among developed nations, Japan stands out for its very low investment in equities. Despite a long tradition of equity investing by individual investors for most of the 20th century, Japanese households now hold less than 10 percent of their assets in equities, down from 30 percent before the 1989-90 crash. Because of low or negative returns over the past two decades, Japanese allocations have never exceeded 18 percent in this period.