About 1400 years ago, paper money was first used in China. Not until 400 years ago did many people in Europe start to use it. Digital cash transactions now outnumber traditional cash transactions around the world. When the government prints new notes, it doesn’t keep any money back. When there are too many bills in […]

It’s much easier to change paper bills than it is to change electronic money. Most business deals in the modern world involve a lot of money. Getting a lot of metal money from one place to another, especially over a long distance, is not easy. But none of these problems are necessary if you use

Although paper currencies are losing ground on the market, people will likely continue to use them for a while. Even if counting in dollars and cents becomes more cumbersome in the future, demand will likely remain stable because, as with many other obsolete technologies, there are still enough individuals who use them. This page discusses

The US Federal Reserve Bank keeps track of the total amount of money in circulation in a number of different ways (the “Fed”). M1 doesn’t count any assets other than cash. Larger numbers after “M” mean that the measure of money includes fewer liquid assets. Unless stated otherwise, we will use M1 to refer to