Bank note issue

The issue of banknotes in principle different from the issuance of debt obligations of the state only in that bill - promissory notes on demand - can be used as legal tender and it is not necessary to pay interest. Since modern money has leveraged nature, bank accounts, in fact not much different from the bill and are the main components of money supply in circulation. In the West, do not write on the bills that they are provided with gold, precious metals and other assets, but this is reflected in their published balance sheets. The collateral acts as an asset of the central bank, the main articles which are usually foreign exchange reserves portfolio of government and other securities, loans to banks against securities. In developed countries, the issue of banknote issue is solved in different ways, but he always has a legal basis, often legally defined character support, and hence, indirectly limits emissions of paper. Earlier in the administrative system of distribution quantity issue was an object of policy planning by the state and in no case could not be exceeded. In a market economy policy planning does not exist, but the central bank forecasts the size of the issue, it is estimated using forecast cash turnover of commercial banks and its own analysis. It is important not only to establish the optimal value of the emissions are projected, but also its distribution in certain regions of the country. Category: METHODOLOGICAL FOUNDATIONS OF MONEY EMIS