Economists use this measurement when they are trying to quantify the amount of money in circulation.
Inflation ate away at the value of money in circulation, while wear and tear reduced the amount.
When the Treasury spends, it adds to the supply of money in circulation.
The Fed can double the price of everything in the economy by simply doubling the amount of printed money in circulation.
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More money in circulation means more inflation down the road, potentially a lot more than the 2% the Fed is planning on.
Economists use this category when looking to quantify the amount of money in circulation and trying to explain different economic monetary conditions.
They want more money in circulation, because their Keynesian models tell them that easy money is the answer to our economic stagnation.
One says that, over the long run, the price of gold approximates the total amount of money in circulation divided by the size of the gold stock.
While not exactly robust, early in a recovery cycle it is positive to see at least small growth in this figure based on the logic that, with more money in circulation more money gets spent by consumers.
The Bank of England is continuing to buy up billions of government bonds as part of its policy of helping the commercial lenders through increasing the amount of money in circulation, a policy known as quantitative easing.
Many of the worst problems will hit retailers, who in some countries will be in the thick of the January sales, the period when shops are busiest and the amount of money in circulation is largest (see article).
Rejecting pressure from the U.S. Fed to cut interest rates, one ECB official said there is too much money in circulation, another sign that Europe is seeking its own way out of what it sees as a crisis born in the U.S.A. Sylvia Poggioli, NPR News, Brussels.
His policy of expanding "power money"--cash in circulation plus bank reserves--will feed inflation, which is currently at 5.2%.
Japan came to the meetings fearful that it would be criticised for doubling the money it plans to have in circulation, a move that has sent the yen tumbling, but its action brought few brickbats.
Even allowing for the time delays and the slower circulation of money in a more slowly moving economy, it seems as though monetary shenanigans which started in 2007 should have been felt by the summer of 2012.
The money is pulled out of active circulation in the economy, which has the same effect as an official decrease in the money supply.
To sum up John Maynard Keynes, it can even make sense to bury money in bottles, so that miners, and the suppliers of their pickaxes and overalls, and those who sell food and materials to those suppliers can, in turn, benefit from the circulation of money that they dig up.
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Our earlier use of this policy approach had little effect on the amount of currency in circulation or on other broad measures of the money supply, such as bank deposits.
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