Programming - NICE MONEY :) - Silent Version

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When gold and silver were used as money, the money supply could grow only if the supply of these metals was increased by mining. This rate of increase would accelerate during periods of gold rushes and discoveries, such as when Columbus traveled to the New World and brought back gold and silver to Spain, or when gold was discovered in California in 1848. This caused inflation, as the value of gold went down. However, if the rate of gold mining could not keep up with the growth of the economy, gold became relatively more valuable, and prices (denominated in gold) would drop, causing deflation. Deflation was the more typical situation for over a century when gold and paper money backed by gold were used as money in the 18th and 19th centuries.

Modern-day monetary systems are based on fiat money and are no longer tied to the value of gold. The amount of money in the economy is influenced by monetary policy, which is the process by which a central bank influences the economy to achieve specific goals. Often, the goal of monetary policy is to maintain low and stable inflation, directly via an inflation targeting strategy,[49] or indirectly via a fixed exchange rate system against a major currency with a stable inflation rate.[50] In some cases, the central bank may pursue various supplementary goals. 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."[51]

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.

Monetary policy strategies have changed over time.[52] Some of the tools used to conduct contemporary monetary policy include:[53]

changing the interest rate at which the central bank loans money to (or borrows money from) the commercial banks
open market operations including currency purchases or sales
forward guidance, i.e. publishing forecasts to communicate the likely future course of monetary policy
raising or lowering bank reserve requirements
In the U.S., the Federal Reserve is responsible for conducting monetary policy, while in the eurozone 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.

During the 1970s and 1980s monetary policy in several countries was influenced by an economic theory known as monetarism. Monetarism argued 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 1980s was a key finding of Milton Friedman and Anna Schwartz[54] supported by the work of David Laidler,[55] and many others. It turned out, however, that maintaining a monetary policy strategy of targeting the money supply did not work very well: The relation between money growth and inflation was not as tight as expected by monetarist theory, and the short-run relation between the money supply and the interest rate, which is the chief instrument through which the cental bank can influence output and inflation, was unreliable. Both problems were due to unpredictable shifts in the demand for money. Consequently, starting in the early 1990s a fundamental reorientation took place in most major central banks, starting to target inflation directly instead of the money supply and using the interest rate as their main instrument.

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MAYOR SLOGO Put Me To WORK... (Minecraft Squid Island)

Dinero es todo activo o bien generalmente aceptado como medio de pago por los agentes económicos para sus intercambios y que además cumple las funciones de ser unidad de cuenta y depósito de valor.1​ Algunos ejemplos de dinero son: las monedas, las divisas y los billetes, las tarjetas de débito y crédito, y las transferencias electrónicas, entre otros.2​

El dinero tal como lo conocemos hoy (billetes y monedas sin valor propio), debe estar avalado o certificado por la entidad emisora. Para su aceptación necesita de la construcción de mecanismos de legitimidad y de confianza3​. Actualmente son los gobiernos,4​ a través de las leyes, quienes determinan cuál es el tipo de dinero de curso legal. Pero son otras entidades, como los bancos centrales y las casas de la moneda (ceca), los que se encargan, primero, de regular y controlar la política monetaria de una economía, y segundo, de crear las monedas y billetes según la demanda y la necesidad de tener en circulación dinero físico.5​ Desde un punto de vista de las Ciencias Sociales entra en juego el factor social ya que la moneda al ser «un bien público», en tanto que presta servicios de tal naturaleza, debe ser regulada por las autoridades públicas (mediante los bancos centrales) en cuanto representantes del interés público, y no solamente a través de los mecanismos de mercado.

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