An Introduction in the Federal Reserve Money system

J.D. ALT, 2019
Level: beginner
Perspectives: Post-Keynesian Economics, Other
Topic: Emerging economies, history of economic thought, money & debt
Format: Blog

This Blog Post describes the U.S. federal reserve money system from the perspective of the Modern Monetary Theory (MMT). Therefore it presents a theory of money creation, gives simple examples how this influences the economy and the historical process of why the monetary system of the US has developed this way.

This Article divides the money in a country in Reserves created by the Central Bank, in Federal Reserve Notes as cash money and in bank-dollars which are created by the private Banks. Especially the dynamics between Reserves and bank-dollars are important to understand the functioning and issues of the US monetary system.

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