ISSUES OF STABILIZATION THE MONEY SUPPLY IN THE ECONOMY

This paper aims to compose aggregate balance sheet, profits and losses of main sectors of economy like banking, households, companies and government. As the result of research it presents the aggregate formula for money and central bank policy interest rate. It concludes that money de-mand is a complex variable and cannot be determined. Accordingly it is proposed to stabilize money supply rather than to determine money demand using the idea of gold standard. Money supply might be stabilized based on energy production and consumption, it is called the “energy currency”.

ISSUES OF STABILIZATION THE MONEY SUPPLY IN THE ECONOMY

This paper aims to compose aggregate balance sheet, profits and losses of main sectors of economy like banking, households, companies and government. As the result of research it presents the aggregate formula for money and central bank policy interest rate. It concludes that money de-mand is a complex variable and cannot be determined. Accordingly it is proposed to stabilize money supply rather than to determine money demand using the idea of gold standard. Money supply might be stabilized based on energy production and consumption, it is called the “energy currency”.

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