Saving is always said to be a good thing. Not a week passes without a central bank governor or finance minister telling us we don’t save enough.

But they are talking about households and their spare cash. And cash accounts for only a small proportion of the savings held by most people.

These days our accumulated wealth is our savings – and far from being a way to protect us from financial shocks, they are toxic and slowly killing the world’s economies.

Firstly there is the sheer scale of savings held by individuals, companies and governments. Earlier this year the International Monetary Fund felt the need to add it all up and declared it a savings glut.

It says institutional investors such as pension funds, insurance companies and mutual funds, along with the sovereign wealth funds of oil-rich nations and central banks, hold around $100 trillion in assets under management.

This huge sum compares to US GDP of around $18 trillion and the total market value of US-listed companies in 2015 of $19 trillion (which today is more like $25 trillion).

Mostly it is invested in stock markets and property or lent to companies and governments in the form of bonds. The remainder is invested in commodities such as oil, or financial derivatives of various assets and insurance products that hedge any potential losses on those assets.

The unprecedented size of these savings might not matter if investors only wanted a modest return. Unfortunately investors are greedy and there are simply not enough things to invest in that can offer the high returns they demand.

So how do investors react? For decades, they have bullied governments to release assets for sale that can then be leased back at high returns. In the UK, this is why we have privatised utilities and a swath of other safe, previously state-owned, assets in private hands.

Then there is the way most people, businesses and governments have accumulated their savings. Just a quick look at the $100tn total and we can see that most of it is the result of tax avoidance.

The Japanese are famous for their savings and investments. But middle-income families can only save because they don’t pay enough tax for officials in Tokyo to provide basic services. Every year the Japanese government runs a 10% budget deficit, such that its accumulated debt is worth almost 250% of GDP.

The same tax shortfall plays havoc with the UK’s finances, though on a smaller scale. Voters who tend to be older, own a home and have a pension – many of whom are also investors – have voted to pay less and less tax since the 1980s.

Privatisations brought in cash to make up some of the gap, but that hasn’t been enough. Successive governments have funded capital projects off the balance sheet through vehicles like the private finance initiative, which were another way for investors to extract an income.

Why pay tax, voters asked themselves, when you can keep the money and earn a return by lending it to the government (or fleecing the government by investing in a private contractor with a state contract)?

The next thing that makes savings toxic is the way investors have bullied governments into making them safe.

It could have been argued 20 years ago that most of the funds in the IMF’s $100tn were in fact risky investments and totally different from bank savings. But in the last two decades, and especially since the 2008 crash, investments have been considered almost as safe as a regulated deposit.

Property is protected from any significant devaluation by ultra-low interest rates. Regulators might argue that mortgage lenders can fail under the new post-crash regime. But such is the importance of property wealth to consumer confidence that politicians have made it clear prices must be protected to prevent a more general economic meltdown.

The protection offered to the stock market is illustrated by Janet Yellen, the boss of the US Federal Reserve, who said last year that the threat of a stock market slump was a key factor in the central bank keeping interest rates at historical lows.

Now she is raising them, but only in tiny increments and only because the arrival of Donald Trump and his promise of a government-funded spending spree offers a bigger payday than ultra-cheap central bank money.

Pension funds are another element of the $100tn that see themselves as benign if not beneficial. Yet a large proportion of saving is only in the pension ledger after avoiding a 20% – or more likely 40% – tax rate.

If these savers had paid tax first and then saved from their net income, governments would have enough money to provide services without the need for extra borrowing.

The IMF says governments should work harder to attract investor funds to build vital infrastructure and close their budget deficits.

But when investment banks demand between 10% and 15% returns and pension funds think we should be grateful they only want 6% to 9%, the IMF is supporting a rip-off perpetrated by today’s savers on tomorrow’s taxpayers. Instead it should use its intellectual muscle to shift the debate and support higher taxes on wealth.