The vast wealth held in pension funds is probably the only real stability in the financial system as this money tends not to react to short term market cycles but asset bubbles are asset bubbles and once the fiat currency that values the assets is debased the wealth in these asset bubbles is only illusionary. Wealth over time is a relative concept. You can't measure wealth absolutely, it is measured against one base or another, be it the value of a currency, gold or something else.
You only have to compare the wealth of the world measured in USD against the value of stock and bond markets to get an idea of how out of kilter things have become. World stock markets are valued at roughly $100 trillion and world bond markets have a similar value when measured in USD which is about twice the value of the world's natural capital, about two thirds of the world's produced capital and a little less than a third of the world's human capital, which is a discounted measure of the lifetime earnings of every person on earth or in other words the value of world stock markets and bond markets is about equal to a third of the value of every person in the world's lifetime earnings. That doesn't sound right to me when you consider the risk that needs to be taken into account in the valuation of stock and bond markets.
Below is an interesting website that discusses and has collected data on the wealth of the world and nations over the last ~120 years.
If you take the same chart as below for the North America, human capital is valued at $270 trillion, produced capital is valued at $77 trillion and natural capital is valued at $9.4 trillion whilst US stock markets alone are valued at about $50 trillion, meaning US stock markets are valued at about 5x the value of all natural capital in North America, about the same as all produced capital and about 13 years of earnings of everyone living in North America (USA and Canada). If you take the earnings from the stock markets themselves out of the picture I'm sure this number would also rise considerably.
One thing is for sure, the banks aren't any source of wealth or any place you want to trust to store any sizeable wealth you might or might not have.Esh
