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Usually, the goal of monetary policy is to accommodate economic growth in an environment of stable prices. For example, it is clearly stated in the Federal Reserve Act that the Board of Governors and the Federal Open Market Committee should seek "to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.

A failed monetary policy can have significant detrimental effects on an economy and the society that depends on it. These include hyperinflation , stagflation , recession , high unemployment, shortages of imported goods, inability to export goods, and even total monetary collapse and the adoption of a much less efficient barter economy.

This happened in Russia, for instance, after the fall of the Soviet Union. Governments and central banks have taken both regulatory and free market approaches to monetary policy.

Some of the tools used to control the money supply include:. In the US, the Federal Reserve is responsible for controlling the money supply, while in the Euro area the respective institution is the European Central Bank.

Other central banks with a significant impact on global finances are the Bank of Japan , People's Bank of China and the Bank of England.

For many years much of monetary policy was influenced by an economic theory known as monetarism. Monetarism is an economic theory which argues that management of the money supply should be the primary means of regulating economic activity.

The stability of the demand for money prior to the s was a key finding of Milton Friedman and Anna Schwartz [48] supported by the work of David Laidler , [49] and many others.

The nature of the demand for money changed during the s owing to technical, institutional, and legal factors [ clarification needed ] and the influence of monetarism has since decreased.

Counterfeit money is imitation currency produced without the legal sanction of the state or government. Producing or using counterfeit money is a form of fraud or forgery.

Counterfeiting is almost as old as money itself. A form of counterfeiting is the production of documents by legitimate printers in response to fraudulent instructions.

During World War II , the Nazis forged British pounds and American dollars. Today some of the finest counterfeit banknotes are called Superdollars because of their high quality and likeness to the real U.

There has been significant counterfeiting of Euro banknotes and coins since the launch of the currency in , but considerably less than for the U.

Money laundering is the process in which the proceeds of crime are transformed into ostensibly legitimate money or other assets. However, in several legal and regulatory systems the term money laundering has become conflated with other forms of financial crime, and sometimes used more generally to include misuse of the financial system involving things such as securities, digital currencies , credit cards, and traditional currency , including terrorism financing , tax evasion , and evading of international sanctions.

From Wikipedia, the free encyclopedia. Object or record accepted as payment. For other uses, see Money disambiguation. Business Business cycle Businessperson Capital Capital accumulation Capital markets Capitalist mode of production Company Corporation Competitive markets Economic interventionism Economic liberalism Economic surplus Entrepreneurship Fictitious capital Financial market Free price system Free market Goods and services Investor Invisible hand Liberalization Marginalism Money Private property Privatization Profit Rent seeking Supply and demand Surplus value Value Wage labour.

Economic systems. Anglo-Saxon Authoritarian Corporate Dirigist Free-market Humanistic Laissez-faire Liberal Libertarian Market Mercantilist Mixed Monopoly National Neoliberal Nordic Private Raw Regulated market Regulatory Rhine Social State State-sponsored Welfare.

Economic theories. American Austrian Chartalism MMT Chicago Classical Institutional Keynesian Neo- New Post- Marxian Monetarist Neoclassical New institutional Supply-side.

Age of Enlightenment Capitalism and Islam Commercial Revolution Feudalism Industrial Revolution Mercantilism Primitive accumulation Physiocracy Simple commodity production.

Advanced Consumer Community Corporate Crony Finance Global Illiberal Late Marxist Merchant Progressive Rentier State monopoly Techno.

Adam Smith John Stuart Mill David Ricardo Thomas Robert Malthus Jean-Baptiste Say Karl Marx Milton Friedman Friedrich Hayek John Maynard Keynes Alfred Marshall Ludwig von Mises Ayn Rand Murray Rothbard Joseph Schumpeter Thorstein Veblen Max Weber Ronald Coase.

Related topics. Anti-capitalism Capitalist state Consumerism Crisis theory Criticism of capitalism Cronyism Culture of capitalism Evergreening Exploitation Globalization History History of theory Market economy Periodizations of capitalism Perspectives on capitalism Post-capitalism Speculation Spontaneous order Venture philanthropy Wage slavery.

Anarcho-capitalism Authoritarian capitalism Democratic capitalism Dirigism Eco-capitalism Humanistic capitalism Inclusive capitalism Liberal capitalism Liberalism Libertarian capitalism Neo-capitalism Neoliberalism Objectivism Ordoliberalism Right-libertarianism Third Way.

Main article: History of money. See also: Monetary economics. Basic concepts. Aggregate demand Aggregate supply Business cycle Deflation Demand shock Disinflation Effective demand Expectations Adaptive Rational Financial crisis Growth Inflation Demand-pull Cost-push Interest rate Investment Liquidity trap Measures of national income and output GDP GNI NNI Microfoundations Money Endogenous Money creation Demand for money Liquidity preference Money supply National accounts SNA Nominal rigidity Price level Recession Shrinkflation Stagflation Supply shock Saving Unemployment.

Fiscal Monetary Commercial Central bank. IS—LM AD—AS Keynesian cross Multiplier Accelerator Phillips curve Arrow—Debreu Harrod—Domar Solow—Swan Ramsey—Cass—Koopmans Overlapping generations General equilibrium DSGE Endogenous growth Matching theory Mundell—Fleming Overshooting NAIRU.

Related fields. Econometrics Economic statistics Monetary economics Development economics International economics.

Mainstream Keynesian Neo- New Monetarism New classical Real business-cycle theory Stockholm Supply-side New neoclassical synthesis Saltwater and freshwater Heterodox Austrian Chartalism Modern Monetary Theory Post-Keynesian Circuitism Disequilibrium Marxian Market monetarism.

Edward C. Prescott Peter Diamond William Nordhaus Joseph Stiglitz Thomas J. Sargent Paul Krugman N. Gregory Mankiw. See also. Macroeconomic model Publications in macroeconomics Economics Applied Microeconomics Political economy Mathematical economics.

Main article: Medium of exchange. Main article: Unit of account. Main article: Standard of deferred payment. Main article: Store of value. Main article: Money supply.

Main article: Market liquidity. Main article: Commodity money. Main article: Representative money. Main article: Fiat money.

Main article: Coin. Main article: Banknote. Main article: Demand deposit. Main article: Digital money. Main article: Monetary policy.

Main article: Counterfeit money. Main article: Money laundering. Money portal. Calculation in kind Coin of account Commons-based peer production Digital currency Foreign exchange market Gift economy Intelligent banknote neutralisation system Labour voucher Leprosy colony money Local exchange trading system Money bag Orders of magnitude currency Seigniorage Slang terms for money Social capital Velocity of Money World currency Counterfeit money.

Boston: Addison Wesley. By John N. Retrieved July The New Palgrave Dictionary of Economics. Retrieved 18 December Gregory New York: Worth Publishers.

Money: Understanding and Creating Alternatives to Legal Tender , White River Junction, Vt: Chelsea Green Publishing Archived from the original on 3 April Retrieved 24 February The Little Money Book.

The Disinformation Company. Archived from the original on February 24, What Are the Seven Wonders of the World?

First Anchor Books, p. Retrieved The Gift: The Form and Reason for Exchange in Archaic Societies.

Bella Caledonia. Naked Capitalism. Toward an anthropological theory of value: the false coin of our own dreams. Palgrave Macmillan. Retrieved 10 February History of the weksel: Bill of exchange and promissory note.

The Travels of Marco Polo, a Venetian, in the Thirteenth Century: Being a Description, by that Early Traveller, of Remarkable Places and Things, in the Eastern Parts of the World.

Retrieved 19 September Randall Modern money theory: a primer on macroeconomics for sovereign monetary systems. Houndmills, Basingstoke, Hampshire: Palgrave Macmillan.

The economic foundations of reconstruction. Macdonald and Evans. Macroeconomics: Theory and Policy.

Tata McGraw-Hill. Archived from the original on October 18, The Money Project. Retrieved 18 July The Theory of Money and Credit , Indianapolis, IN: Liberty Fund, Inc.

Money and the Mechanism of Exchange. Alan V. Department of Economics, University of Michigan. A Law Dictionary Containing Definitions Of The Terms And Phrases Of American And English Jurisprudence, Ancient And Modern , p.

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