Money supply - is the blood of the economy

Money supply - the means used for the purchase or sale of goods or services.They are owned by institutional owners, individuals and countries.Structure of the money supply is:

1) active agents to be used in the back;

2) passive - accumulation, account balances, and so on. They have the potential to go in the first group, and vice versa.

money supply - a set of tools that define the economy of a State.It includes, inter alia, deposits, savings certificates, and so on. In general, this is all that can be classified as finance, in circulation in a particular country or locality.These include all the means of payment.

into a modern, developed economy the money supply - it's mostly non-cash means.These include checks, money orders, vouchers and so on. D. Non-cash money supply exists in the form of entries in the accounts of the branches of the central or commercial banks.This kind of finance is not a means of payment.However, it can be cashed at any time.This process guarantees a certain credit insti

tutions.

general, non-cash money have several advantages.Transporting large amounts of bills - it is expensive and unsafe.A clearing can be translated much more simple way.In addition, the notes and coins can be faked.And just fake up an average of 15 to 25% of the total turnover.Leading financial experts are predicting that in the future the cash disappears, it will replace the electronic money.So it will be more comfortable and safer.Already, the cash gradually fade into the background.The vast majority of transactions are concluded with the use of bank accounts.Even retail is not an exception to this rule.

cash money supply - a tool that has the right to exclusively produce the state.However, not every country can afford to print their own banknotes and coins stamped.Therefore, some states passed the order on creation of currency to other countries.In addition, every five years, the bill should be changed.

money supply - is the financial flows that are constantly in motion.The rate of circulation is influenced by many factors.In particular, the gradual replacement of metal and paper money credit cards, the use of electronic systems, the introduction of modern technologies in banking and so forth. The acceleration of treatment resources provokes a rise in money supply, which is one of the reasons for the increase in inflation.Scaling lending also results in the additional issue.Inflation is constrained by the definition of reserve requirements and interest rates, the imposition of the economic framework for banks.With the increase in the volume of lending and the money supply is growing.And vice versa - when the loan back, the emission decreases.

If the money supply is growing - it is not always a negative thing for the economy.For example, a constant and reasonable emissions, combined with increased production contributes to price stability.By itself, the money supply is not the decisive factor in the economy.