Electronic Money and Its Impact on Central Banking and Monetary Policy
“The term [electronic] money refers to various proposed electronic payment mechanisms designed for use by consumers to make retail payments. Digital money products have the potential to replace central bank currency” (Berentsen 1). This quote indicates that the advent of electronic money will have an impact on the banking system and monetary policy. While this topic is controversial it seems obvious that some changes will result and that there is no prefect answer to predict this new instruments affect on monetary aggregates and the role of central banks. Its growth will be based on many things: future technology, increased security, regulation, and ease of conversion. It can impact such variables as monetary supply, exchange rates, the money multiplier, velocity of money and seignorage. Increased reliance on electronic money as a substitute for currency will directly affect the central bank and its control over monetary aggregates and policies.
Electronic money is the money balance recorded electronically on a “stored-value” card (Ely 1). These cards, “smart cards,” have a microprocessor embedded which can be loaded with a monetary value. Another form of electronic money is network money, “software that allows the transfer of value on computer networks, particularly the internet. Like a travelers check, a digital money balance is a floating claim on a private bank or other financial institution that is not linked to any particular account” (Berentsen 1-2). This money is issued by both public and private institutions worldwide and is raising concern about the future ability of central banks to set money supply targets. It is widely used in...
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Summary: We see that there are many different aspects and types of human trafficking that everyone should be made aware of. As a whole human trafficking is a lucrative industry raking in $150 BILLION globally. The impact that this industry has on its victims is
Author Unknown (1994). The Federal Reserve System: Purposes and Functions (5th ed.) Published by Library of Congress
Money has evolved with the times and is a reflection of the progress of man. Early money was a physical commodity, grain, gold or silver. During the vital stage, more symbolic forms of money such as certificates of deposit, bank notes, checks, letters of credit, bonds and other forms of negotiable securities came into prominence. Social development transformed money into a trust, “In God We Trust' it says on the back of the ten-dollar bill.” (The Ascent of Money, 27)
Michael Rodriguez James Maughn English 1A 20 May 2015 bitcoin fantasy. The Nation. The World. The World. ARE DIGITAL CURRENCIES THE FUTURE OF MONEY?
Over the last ten years people in the United State and around the world have heavily relied more on their debit or credit cards to process transactions of their purchases. In the old days it used to be when you would get your paycheck on Friday and rush to the bank during your break or lunch in order to cash withdraw your funds or deposit them into your account. It used to be where you carry cash to buy groceries, pay bills, and go shopping. Now some people don’t even set foot inside their bank branch because they are paid using direct deposit or the funds are loaded into a debit card provided by their employer. Many employers from around the globe don’t even issue paper check anymore.
receiving money by means of computers in an easy, secure and fast way using an account-based system. This can be
The invention of money is perhaps one of the greatest achievements of human civilization. From the very beginning of society, people have used money to circumvent the difficulties of bartering and to foster trade and commerce. Since then, money has come a long way. No longer do we need to rely on silver coins, cocoa beans, or even anything of intrinsic value to conduct our business; today, we use paper currency, which is convenient and easy to carry around. But slowly, we are moving into the digital age of money, an age in which less of our money is actually tangible and more of it is just data on a computer server. To some, this prospect may seem daunting. However, given the major advantages of electronic money over outmoded paper counterpart, society as a whole should embrace the upcoming era of digital money.
The use of credit and debit cards today are taking a tour in the sense that electronic cash is becoming more admissible as the world makes a switch towar...