There are 119 Merit Sources that can generate up to 22045 sMerits every 30 days. These 119 Merit Sources obviously know they are Merit Sources, and were appointed to the task at some point by @theymos (be it because they volunteer for the task as reputable members, or thet @theymos thought they would deem fit). Each Merit Source has a different monthly allowance, some small (i.e. 50 sMerits per month), some large (i.e. 1000  sMerits per month). The allowance is decided by @theymos as per his criteria, and is refilled every 30 days (it’s a bit more complex really, but let’s not get into the details now).

The above are called Merit Sources, since they generate sMerit "out of thin air" every month. In addition, regular people (and Merit Sources themselves on top of the above) may have sMerit to award in their account if:

-   They had it airdropped on the 24th of January 2018, when the Merit System kicked off.
-   For every 2 (non-airdropped) Merits they have received, they have 1 sMerit to send.

Regular people with available sMerit are not called Merit Sources.

Now if you see a profile with say 100 Merits, that does not mean he has any sMerits available to give out, not that he ever had any. It depends on how and when he got those 100 Merits in the first place. You cannot see how much sMerit a user has available, although you can infer it to some extent.

For further details see: re: Who can award merits?.