China's currency is worth double that of USD. WTF? How is this possible?

[stallion]

A perfect analogy from amph:

' It's like the anecdote of what is the most widely spoken language, while Chinese is the language that is spoken the most, English is the language that is more widespread'.

You can't fuck with dollar right now, but things change. The only thing inevitable in this world is change.

[Erdogan]

It is the demand for money, from savers. They have a lot of savers.

[bryant.coleman]

They are inflating the money supply, by adding the M1 and M2 components. In mid-2015, the CNY money supply was as follows:

M0: ¥7.65 trillion ($1.22 trillion)
M1: ¥34.81 trillion ($5.57 trillion)
M2: ¥130.74 trillion ($20.9 trillion)

For the USD, the money supply is as follows:

M0: $3.95 trillion
M1: $3.0 trillion
M2: $11.937 trillion

So it is clear that the M0 money supply for CNY is much lower than that of the USD.

[HarHarHar9965]

China's economy is dependent on US and vice versa. China does have a large economy as it has a large market, but when calculated according to the market of america, its contributions aren't as much as US on a global scale. The size of economy won't make it as strong as USD but its acceptance will.

[BillyBones]

I do not understand how China's currency can be almost twice the value of USD? USD GDP is almost double that of China, PLUS USD is the global reserve currency, so there's even more of it out there than there otherwise would be.
Please, someone explain this to me!?

According to http://www.investopedia.com/articles/forex/09/chinas-peg-to-the-dollar.asp | Despite a slowing growth trajectory that saw the economy expand by “only” 7.7% in 2013, China appears to be on track to surpass the United States as the world’s largest economy sometime in the 2020s. In fact, based on purchasing power parity - which adjusts for differences in currency rates - China may pull ahead of the U.S. as early as 2016, according to a report on global long-term growth prospects released by the Organization for Economic Cooperation and Development in November 2012. (It should be noted that such bullish estimates about China’s long-term growth prospects are viewed with considerable skepticism by a growing number of economists and market watchers.)

Year 2015 is coming to an end, and have you seen any such results as mentioned above regards to china, there is long way to go and it is very hard to topple U.S Currencies.