Credit resources and monetary aggregates

Credit resources and monetary aggregates

In modern economics, moneythe aggregate is considered as the amount of money, as well as other financial resources, identical to the money supply. It is generally accepted that monetary aggregates have a liquidity close to unity.

Throughout most of the time of using this economic category, it was considered that the main monetary aggregates act as the main objects of credit policy.

In economic science, such aggregates of the money supply as:

  • cash (M0);
  • financial assets: cash, credit and demand deposits (M1);
  • aggregates of the type M2 - are formed by the addition of M and various types of time deposits;
  • aggregates of the type M3 - are formed by the addition of M and a number of large time deposits (deposit certificates);
  • aggregates of the type L-the widest of the aggregates, which includes general financial assets, without exception.

In today's economy, credit resources are gaining in importance in the structure of monetary aggregates. And this is directly determined by the need to expand the functions of credit.

In the issues of the list of functions of credit and theircharacteristics economists did not come to a common opinion. Often, the same characteristics of a function refer to different function names or, conversely, different functions are identified.

For example, the substitution function is identifiedsigns of money and the credit function of circulation, since it is asserted that in both cases credit acts as a category of exchange. Nevertheless, it is necessary to separate these functions, since it is obvious that the issue of credit money (the fact of substitution with money signs) and circulation of credit money is far from identical and affect the monetary aggregates and their types in terms of their composition and structure.

When characterizing the distribution function inliterature emphasizes the productive nature of the redistribution of credit resources. However, the functioning of credit resources does not always have a productive character, that is, a reallocated, but not increased, credit value that can not be included in monetary aggregates. In this regard, in addition to the steam distribution function, the function of stimulating resource saving should be proposed, which is responsible for the productive nature of the movement of credit value, and the function of creating a new credit value as self-increasing.

In the economic literature, three maincredit functions - distribution, control and substitution, as well as a number of other functions that predetermine the active role of credit as part of money included in monetary aggregates. That is why, on the basis of known functions, a classification of functions that retain their relevance with the addition of a new loan function is formed: the transformation of inactive capital into a functioning one.

It provides:

  • link credit with the economy as a whole:
  • creation of a new credit value as a self-increasing value;
  • the creation of a credit of circulation of funds (credit and non-credit money);
  • credit servicing of money turnover (real and modern, so-called loan money);
  • replacement of cash money turnover (credit cash and credit non-cash money).

The role of the loan as a result of the implementation of its functions will ensure the acceleration of the circulation of monetary funds, which, in turn, will have a positive effect on monetary aggregates.

The principle of constructing such a model ishierarchy, determined by the purpose, direction, details of the functions. The classification of functions is based on the creation of a new credit value as self-increasing, and the end result involves the transformation of inactive capital into a functioning one.

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