At least 15 sentense Question — Money “The United States can pay any debt is has

Question

At least 15 sentense

Question — Money

“The United States can pay any debt is has because we can always print money to do that.  So there is zero probability to default” (Greenspan)

“It’s not tax money.  The banks have accounts with the Fed much the same way that you have an account in a commercial bank.  So to lend to a bank we simply use the computer to mark up the size of the account that they have with the Fed” (Bernanke)

Explain in detail the two views towards money.  What does scarcity have to do with ideas of money if any?

When economists talk about the Money Supply, what exactly are they referring to?  That is, what components make up the Money Supply? Does an increase in reserves in the banking system lead to inflation? Explain why or why not.  Which institution creates the majority of the Money Supply, the government or the banks? In the balance sheets of the Federal Reserve, Commercial Banks & Thrifts and HHs & Firms whose assets are whose liabilities?  What does looking at a balance sheet tell us about the definition of money?  

If the federal government does not “need” your money to spend, why is it taxing you? What does this tell us about the reason why we accept U.S. currency as a means of exchange?

Because GDP = NI, we get the equation 0 = (I-S) + (G-T) + (X-M).  This equation is reflected in the graph below.  What do the equation and the graph tell us about the relationship between government deficit and private sector surplus?  Why is the graph a mirror image?  If you own government securities, is this a debt or a credit from your perspective?  

Why would Hamilton say, “anything that is technologically feasible is financially possible” (1987)?  What are society’s real constraints?  What solutions are available to us to remedy some of these problems?

Explanation / Answer

Scarcity is the marvel of inadequate liquidity in the economy to fund every single conceivable exchange. This outcome in (forever) discouraged economies. Scarcity dependably has been the key issue that Populist money related reformers needed to illuminate, following the time when the Civil War. They proposed to include Greenback-style obligation free United States notes to the cash supply. Be that as it may, the call to adapt Silver was considerably more regular.

The U.S. cash supply involves money—dollar notes and coins issued by the Federal Reserve System and the U.S. Treasury—and different sorts of stores held by people in general at business banks and other vault establishments, for example, thrifts and credit unions.

For example, many economists were worried that the development of reserves in the U.S. Banking money framework amid the financial crisis will turn out to be inflationary. On the other hand, the ascent in abundance saves as a major aspect of the Fed's quantitative facilitating is very different from the Fed's infusion of stores as a feature of the traditional arrangement.

Looking at balance sheets we come up with three meanings of cash that the Federal Reserve utilizes: M1, a slender measure of cash's capacity as a medium of trade; M2, a more extensive measure that likewise mirrors cash's capacity as a store of worth; and M3, a still more extensive measure that covers things that numerous view as close substitutes for cash.

At the end of the day, the private division's parity is equivalent to the general population segment's parity. Be that as it may, this perspective is sparing NET OF INVESTMENT. In the event that you see the world through this viewpoint then the private part can't NET recovery without government spending and NFA issuance. Be that as it may, is it best to net out venture when attempting to see how the fiscal framework functions? All things considered, the private area is based to a great extent on the back of private venture. Utilizing (S-I) to portray private sparing is deceiving as I would like to think, as well as significantly less fascinating than a few individuals may have you accept.

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