Talk:Money creation
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There are only a few ways money is created (at least in the US, or any economy with a central bank). Discussion in this article should be focused on these topics:
- Counterfeiting
- Printing money
- The Federal Reserve and should be discussed in that article
- buying/selling t-bills and t-bonds
- changing the federal funds rate (discount rate)
- and changing the reserve ratio
Finally... if a history of money creation is desired, discussion over the history of 'fractional reserve banking' could be discussed here or in that article.C. Nelson 03:27, 20 March 2006 (UTC)
[edit] Added Discussions
We must add to the equation the currency drain ratio (the propensity of the public to hold cash rather than deposit it in the banking system),the clearing house drain (the loss of deposits from the system due to interactions between banks), and the safety reserve ratio (excess reserves beyond the legal requirement that commercial banks voluntarily hold - usually a very small amount). Also, most jurisdictions require different levels of reserves for different types of deposits. Foreign currency deposits, domestic time deposits, and government deposits often have different cash reserve ratios.
[edit] Disputed
See http://en.wikipedia.org/wiki/Talk:Fractional-reserve_banking
- I agree with the dispute tag. This article goes completely against modern (post 1920) economic theory. Money is more than coins and banknotes, it includes electronic money,
and bookkeeping entries - anything that represents a liability of the central bank. Not being allowed to talk about the Fed??!! Obviously something is wrong here Smallbones 15:01, 17 September 2006 (UTC)
