Lecture 11. LEGAL BASIS OF MONEY CIRCULATION
1. Concept, signs and functions of money.
2. The concept of the monetary system and its elements.
3. Legal regulation of cash money circulation.
4. Legal basis for non-cash payments.
Concept, signs and functions of money
Since monetary circulation is, first of all, the movement of money, it seems logical to consider the concept, essence and functions of money as an economic and legal category.
At a certain historical stage, the development of commodity exchange led to the emergence of a specific commodity from the entire mass of other goods, to which the social function of a universal equivalent was assigned.
The essence of money as a universal equivalent is manifested in the fact that with its help the value of any product is determined and the exchange of some goods for others is ensured. Possessing the property of universal direct exchangeability for all other goods, money becomes an independent economic category. It is the view of the essence of money as a universal equivalent that prevails in financial and economic literature. The essence of money is manifested in its functions, among which the following stand out.
1. Money as a measure of value - Money is used to estimate the value of all other goods and services through a price-setting mechanism. Price is the monetary expression of the cost (value) of a product, service, asset, as well as a factor of production (natural resources, resources, capital).
2. Money as a medium of exchange - money acts as an intermediary between the seller and the buyer, between the producer of works and services and their consumer. The exchange of goods using money is carried out according to the formula: T-D-T. Money is constantly in the process of exchange and continuously serves it.
3. Money as a means of payment - means that money is used to make settlements between business entities for obligations, contributions and other payments.
4. Money as a means of accumulation and savings - means that money turns into a special asset (property), which provides its owner with the opportunity to buy various goods in the future. The term “accumulation” applies to enterprises and the state, and “savings” to households.
5. The function of world money is means the functioning of money in international circulation and ensuring universal equivalence of exchange.
Money is also a legal category. In the legal sense, money acts as an object that is the object of civil legal relations and performs the function of general exchange. The following main public legal characteristics of money can be distinguished:
1) only what is recognized as money by the state is recognized as money;
2) money is produced only according to samples and descriptions strictly established by the state by specialized state enterprises (mints);
3) the nominal value of money is arbitrarily assigned by the state and expressed in national monetary units;
4) money is required to be accepted by all residents of the issuing country at nominal value;
5) violation of the state monopoly on the production of money for the purpose of releasing it into circulation entails the application of criminal and administrative measures.
The main legal characteristic of money is that the state grants it the special status of the only legal tender throughout the territory of a particular state.
Money is a specific product that is a universal equivalent to the cost of other goods or services. According to the most common version, the Russian word “money” comes from the Turkic “tenge”.
Before the advent of money, there was barter - a direct non-monetary exchange of goods. Money arose during the transition from subsistence farming to the production of goods. In different regions of the world, various things (commodity money) were used as money: livestock, furs, animal skins, pearls. Later, gold and silver were used as money, first in the form of bars and then in the form of coins.
Gradually, gold and silver coins displaced other goods from circulation as money. This is due to the convenience of their storage, crushing and joining, relative high cost with low weight and volume, which is very convenient for exchange.
Thanks to the use of money, it became possible to divide the one-time process of mutual exchange of goods into two processes carried out at different times: the first consists of selling one’s goods, and the second in acquiring the desired goods at another time and in another place.
The functioning of money acquires the features of an independent process. Commodity producers can keep the money received from the sale of their goods until they purchase the desired product. From here, monetary savings arose, which could be used both to purchase goods and to lend money and pay off debts.
As a result of such processes, the movement of money acquired independent significance and was separated from the movement of goods. The functioning of money gained even greater independence in connection with the replacement of full-fledged money, which has its own value, with banknotes, as well as with the subsequent abolition of the fixed gold content of the monetary unit. At the same time, money that did not have its own value began to function in circulation, which made it possible to issue banknotes in accordance with the need for circulation, regardless of the presence of gold backing.
TYPES OF MONEY
There are extremely many varieties of money. Each type of money has subtypes that combine their diverse forms. They differ in the type of monetary material, methods of circulation, use, accounting of the money supply, and the possibilities of converting one type into another. But historically there are four main types of money: commodity, secured, fiat and credit.
Commodity money(natural, material, real, real) are products that have independent value and utility. They include all types of goods that acted as equivalents in the initial stages of the development of commodity circulation (livestock, grain, furs, etc.), as well as metal money - copper, bronze, silver, gold full-weight coins.
Secured money(change, representative) can be exchanged at sight for a fixed amount of a certain product or commodity money, for example, gold or silver. In fact, secured money is a representative of commodity money.
Fiat money(symbolic, paper, decreed, unreal) do not have independent value or it is disproportionate to the face value. They have no value, but are capable of performing the functions of money, since the state accepts them as payment of taxes, and also declares them legal tender on its territory. Today, the main form of fiat money is banknotes and non-cash money held in a bank account.
Credit money- these are rights of claim in the future against individuals or legal entities, a specially designed debt, usually in the form of a transferable security, which can be used to purchase goods (services) or pay one’s own debts. Payment for such debts is usually made within a certain period.
There are also such types of money as full and defective; cash and non-cash.
Full money have a commodity value that allows them to form their purchasing power. Purchasing power, in turn, is adequate to the internal value of money, determined by the conditions of its reproduction. Full-fledged money is divided into commodity and metal.
Bad money have no commodity value and can be secured or unsecured; charter and money surrogates (depending on the legislative framework for the circulation of banknotes). Defective money, backed by goods or currency metals, are considered representatives of full-fledged money and, having no intrinsic value, have a representative value. Representative value is a measure of the purchasing value that defective secured money has as a result of exchange for full value. Since fiat money has no collateral, it is not exchangeable for gold or currency metals and is money due to the general recognition and trust of business entities in it.
Hartal - types of inferior money, the circulation of which has a legislative basis, is recognized and supported by the state.
Cash– these are those that are in the hands of the population and serve retail trade turnover, as well as personal payment and settlement transactions. Thus, cash is metal and paper money that is transferred from hand to hand in kind.
Non-cash money- This is the bulk of the funds in bank accounts. They are also called deposit or non-cash credit money.
The form of money is the external expression (embodiment) of a certain type of money, differentiated by the functions it performs. There are the following forms of money: metal, paper, credit, bills, banknotes, deposits, checks, non-cash, electronic.
METAL MONEY
From the many types of commodity money, precious metals emerged, which gradually became a universal form of money. They did not deteriorate over time and were easily divided into parts. These metals were both high in cost and relatively widespread (they are found in almost all regions of the planet, but in low concentrations).
Around the end of the 7th century BC. e. In Lydia (Asia Minor), coins were invented - round ingots of precious metals, whose standards were guaranteed by state coinage. Coins quickly became the universal means of exchange for most Old World civilizations. Since gold and silver coins had their own value, they could be used in all countries where metal money was in use. However, each state sought to mint its own coin, thereby demonstrating its sovereignty.
Metallic money is real money, i.e. their nominal value corresponds to the real value or value of the metal from which they are made.
PAPER MONEY
Historically, paper money appeared as a substitute for gold coins in circulation. At the initial stage, they were issued by the state along with gold coins and, with the aim of their introduction, were exchanged for them. Peculiarity paper money is that they, being deprived of independent value, are provided with a forced rate by the state. Paper money performs only two functions, being a means of circulation and a means of payment. The state, constantly experiencing a lack of financial resources, as a rule, increases the issue of paper money without taking into account commodity circulation and payment turnover. The absence of gold exchange makes them unsuitable for fulfilling the function of treasure and their surplus cannot leave circulation on its own.
CREDIT MONEY
Credit money arises with the development of commodity production, when purchases and sales are carried out in installments (on credit). Their appearance is associated with the function of money as a means of payment, where they act as an obligation that must be repaid on time.
A feature of credit money is that its release into circulation is linked to the actual needs of circulation. The loan is issued against collateral, which is certain types of inventory, and repayment of loans occurs when the balance of valuables decreases. Thanks to this, it is possible to link the volume of means of payment provided to borrowers with the actual need for money turnover.
Credit money does not have its own value; it is a symbolic expression of the value contained in an equivalent product. They are usually released into circulation by banks when performing credit operations. Credit money has gone through the following development path: bill of exchange, accepted bill of exchange, banknote, check, electronic money, credit cards.
Bill of exchange
A bill of exchange is the first type of credit money that arose as a result of trade with installment payments. A promissory note is a written unconditional obligation of the debtor to pay a certain amount at a predetermined time and place. A distinction is made between a promissory note issued by the debtor and a bill of exchange (draft), issued by the creditor and sent to the debtor for signature and returned to the creditor.
Currently, there are also treasury bills, which are issued by the state to cover the budget deficit and cash gap, friendly bills issued by one person to another for the purpose of accounting for them in the bank, bronze bills that do not have a commodity cover. The payment guarantee of the bill increases upon acceptance (consent) by the bank - this is an accepted bill.
The features of the bill are:
abstractness - the type of transaction is not indicated on the bill of exchange;
indisputability - mandatory payment of the debt up to the adoption of coercive measures after drawing up an act of protest;
negotiability - transfer of a bill of exchange as a means of payment to other persons with an endorsement on its back (giro or endorsement), which creates the possibility of mutual offset of bill obligations;
the bill serves only wholesale trade, in which the balance of mutual claims is repaid in cash;
A limited number of persons are involved in bill circulation.
Banknote
A banknote is credit money issued by the central (issuing) bank of the country. Initially, the banknote had double security: a commercial guarantee, since it was issued on the basis of commercial bills associated with trade turnover, and a gold guarantee, which ensured its exchange for gold. Such banknotes were called classic and had high stability and reliability.
A banknote differs from a bill of exchange:
1. By maturity - a bill is a short-term debt obligation (3-6 months), a banknote is a perpetual debt obligation.
2. By guarantee - a bill of exchange is issued by an individual entrepreneur and has an individual guarantee, a banknote is issued by the central bank and has a state guarantee.
A classic banknote (i.e., exchangeable for metal) differs from paper money:
1. By origin - paper money arose from the function of money as a means of circulation, a banknote - from the function of money as a means of payment.
2. According to the method of issue - paper money is issued into circulation by the Ministry of Finance, banknotes - by the central bank.
3. By repayment - classic banknotes, after the expiration of the term of the bill under which they were issued, are returned to the central bank, paper money is not returned.
4. By exchangeability - a classic banknote upon return to the bank was exchanged for gold or silver; paper money was always irredeemable.
Currently, banknotes come into circulation through bank lending to the state, bank lending to the economy through commercial banks, and the exchange of foreign currency for banknotes of a given country.
Modern banknotes are not redeemable for gold and are not always backed by goods. Currently, central banks of countries issue banknotes of strictly defined denominations. Essentially, they are national money throughout the state.
Deposit money
These are numerical entries in customers' bank accounts. They appear when the owner presents the vessel to his bank account. Instead of paying in banknotes for a bill, the bank opens an account from which payment is made by debiting them.
Deposit money can perform a cumulative function thanks to the interest received when transferring funds for temporary use to the bank. They serve as a measure of value, but cannot serve as means of circulation.
A deposit, like a bill of exchange, has a dual nature. On the one hand, it is money capital, and on the other hand, it is a means of payment. The resolution of the contradiction of the deposit between the function of capital (savings) and the payment function was carried out by dividing the deposit into a current account and a savings, time deposit.
Checks
Check - monetary document, containing an order from the account holder at a credit institution to pay the check holder the specified amount. The following types of checks exist;
1. Personalized - issued to a specific person without the right of transfer.
2. Warrants - drawn up for a specific person, but with the right to transfer to another person by endorsement.
3. Bearer - for which the indicated amount is paid to the bearer of the check.
4. Settlement - used only for non-cash payments.
5. Accepted - for which the bank gives acceptance, or consent to make payment of a certain amount.
The essence of a check is that it serves as a means of obtaining cash from a bank, acts as a means of circulation and payment, and is also an instrument of non-cash payments.
Non-cash money
IN developed countries In a market economy, most of the circulating medium is non-cash. Non-cash money - entries in accounts at the central bank and its branches, as well as deposits in commercial banks.
Non-cash money is essentially not a means of payment, but at any moment it can turn into cash guaranteed by credit institutions. In practice, they perform on a par with cash and even have some advantages over it.
Electronic money
The end of the 20th century was marked by the transition to a new type of money - “electronic”. This became possible thanks to the mass production of computers, which made it possible to switch to electronic payment transfers.
Electronic money is broadly defined as the electronic storage of monetary value using a technical device that can be widely used to make payments not only to the issuer, but also to other companies, which does not require the mandatory use of bank accounts for transactions, but acts as a prepaid instrument to bearer.
Electronic money is the monetary obligations of the issuer in electronic form, which are on an electronic medium at the user’s disposal.
At the core electronic money lies the usual deposit circulation, based on the initial deposit by the person making the payment of a certain amount of credit money.
One should also distinguish between electronic fiat money and electronic non-fiat money. Fiat currency is necessarily expressed in one of the state currencies and is a type of monetary unit of the payment system of one of the states. The state laws oblige all citizens to accept fiat money for payment. Non-fiat - are electronic units of value of non-state payment systems. Accordingly, the issue, circulation and redemption (exchange for fiat money) of electronic non-fiat money occur according to the rules of non-state payment systems.
Electronic money is gradually replacing checks and replacing them credit cards- a means of payment that replaces cash, as well as a means of obtaining short-term loans from banks.
FUNCTIONS OF MONEY
The essence of money as an economic category is manifested in its functions, which express the internal basis of the content of money. The unity of functions creates the idea of money as a special, specific product that participates as a necessary element in the reproduction process of society. Money can perform its functions only with the participation of people. It is people who, using the capabilities of money, can determine the prices of goods and use them as savings. In developed commercial farming money performs the following functions: measures of value, means of circulation, means of payment, means of storage and world money.
The function of a measure of value is to estimate the cost of goods and services. The cost of a product expressed in money is called its price. In the market, prices can deviate up or down from value (depending on the relationship between supply and demand). Money is also used when recording the value of an economic parameter or recording a liability.
The function of money as a medium of exchange is used as an intermediary in acts of purchase and sale of goods. For this function, the ease and speed with which money can be exchanged for any other product (liquidity indicator) is extremely important.
The function of money as a means of payment appeared in connection with the development of credit relations, that is, with the possibility of deferring payment. Money performs this function when providing and repaying cash loans, in monetary relations with financial authorities, also when repaying wage arrears, etc.
The function of a store of value is performed by money that is not directly involved in circulation. Money as a store of value allows you to transfer purchasing power from the present to the future. However, it must be taken into account that the purchasing power of money depends on inflation. To prevent money from depreciating, it is widely practiced to accumulate it in the form of gold, foreign currency, real estate, and securities.
The function of world money is manifested in the relationships between economic entities: states, legal entities and individuals located in different countries. Until the 20th century, the role of world money was played by precious metals (primarily gold in the form of coins or bars), and sometimes precious stones. Nowadays, this role is usually performed by some national currencies - the US dollar, pound sterling, euro and yen, although economic entities may use other currencies in international transactions.
In a modern market economy, the functions of money have undergone modifications. Commodity-money relations have acquired a universal and global character. Thus, without exception, all goods, services, natural and intellectual resources, as well as the labor and abilities of people are valued today in monetary terms.
Money has been known to mankind since ancient times., but the need for them in a subsistence economy was episodic in nature, since only the accidentally remaining surpluses were exchanged. The exchange of goods was carried out according to the formula: T-T. The development of productive forces and production relations entailed a social division of labor and created conditions for the emergence of a surplus product, and with it the need for exchange. All material assets produced in society took the form of goods, and this required measuring the labor costs embodied in them. This measurement was made by comparing the value of a certain commodity with the value of a special commodity used as a universal equivalent - money.
Money - product, being the universal equivalent of the value of other goods. With the advent of money, commodity exchange began to occur according to the formula: T-D-T, i.e. a product is exchanged for a certain amount of money, and then another product is purchased with the proceeds. The commodity world was divided into a commodity part and a special commodity, playing the role of a universal equivalent - money.
As money performed in different historical eras and in different countries miscellaneous goods, and then noble metals, which subsequently turned out to be most suitable for fulfilling this role. The involvement of precious metals in fulfilling the role of money is associated with such properties as divisibility, homogeneity, preservation.
The economic literature identifies the following stages in the evolution of money:
Stage 1 - the appearance of money with random goods performing its functions;
Stage 2 - assigning a universal equivalent to gold.
Stage 3 - transition to paper or credit money;
Stage 4 - gradual displacement of cash from circulation.
1st stage inherent subsistence farming, when products were produced for one's own consumption, and the surplus was used for exchange for the products of other producers, most often by accident. The development of the production of various goods required compliance with the equivalence of their value and contributed to the identification among the general diversity of a certain general equivalent in the form of goods that had a high liquidity and, accordingly, the ability to implement. Such goods included livestock, furs, precious stones and metals.
2nd stage - highlighting gold as a universal equivalent, which at that time had such qualities as rarity, uniformity, divisibility, shelf life, high cost and availability of sufficient quantity.
3rd stage - the transition to paper money, which was associated with the inability of money made from precious metals to respond to current economic conditions. For the convenience of paying for goods, it began to be used bill of exchange, which is an unconditional written obligation of the debtor to pay the amount indicated on it within a specified period. For the flexibility of bill circulation, banknotes were introduced, the issue of which was carried out by the Central Bank through the rediscounting of bills.
4th stage - continues to develop at the present time, aimed at gradually ousting cash from circulation. The movement of money in accounts occurs using checks, which are a type of bill of exchange containing an unconditional order from the drawer to a credit institution to pay the check holder the amount specified in it.
In the 60s of the XX century appears the new kind electronic check processing device - electronic money. This electronic system, operating through the transmission of electronic signals and allowing credit and payment transactions to be carried out without the use of paper media.
Reduced need in cash banknotes is associated with the emergence of special means of payment as plastic card with an applied magnetic stripe or a built-in chip containing information about the client’s bank account.
The essence of money is expressed in the unity of three properties:
In the form of general direct exchangeability - money can be exchanged for other goods;
In the form of independent exchange value, money can be exchanged for goods at a symbolically nominal value, which does not correspond to their real value;
In the form of materialization of socially necessary labor time, money measures labor costs embodied in goods.
2. Functions of money
The essence of money manifested in the functions they perform. The unity of functions creates the idea of money as a special, specific product that participates as a necessary element in the reproduction process of society.
Measure of value - in this function, money in circulation is called the weight quantity of money; it measures the value of all goods as quantities of the same name, qualitatively identical and quantitatively comparable, since all goods as values represent materialized labor and labor time costs. Value expressed in money is a price that is expressed in a certain quantity of a monetary commodity - gold.
Amount of gold is measured by its weight, and a certain weight amount of gold is taken as a unit of measurement of its mass, this unit is established by the state as a monetary unit and is called the price scale. Thus, all prices of goods are expressed in a certain number of monetary units or in a certain number of weight units of gold.
For price comparison goods of different prices must be reduced to the same scale. The scale of metal prices is accepted in a given country as a monetary unit and serves to measure the price of all other goods.
Between money There are significant differences between money as a measure of value and money as a price scale. Money as a measure of value relates to all other goods, arises spontaneously, and changes depending on the amount of social labor spent on the production of a money commodity. Money as a price scale is set by the state and acts as a fixed weight amount of metal that changes with the value of this product.
Functionfacilities payment manifests itself in servicing payments outside the scope of trade turnover, when providing and repaying cash loans, when paying off wage arrears, paying taxes, social benefits, and interest on loans.
Asfacilities appeals money serves the chain of continuous transformations of goods into money and money into goods (T-M-T), being an intermediary in purchase and sale, as well as a means of control on the part of the buyer over the production of goods, eliminating imbalances between supply and demand.
How store of value After the sale of goods and services, money is temporarily withdrawn from circulation and accumulated for future purchases. Savings for a short period are carried out in the form of opening deposit accounts in credit institutions. Long-term savings - in the form of investing in government securities, real estate, jewelry, precious metals.
World money- This is money in the system of international economic relations. Their emergence was facilitated by the deepening international division of labor and the creation of a global financial market. Gold acts as world money as the final means of payment in cases of the formation of a passive balance of the balance of payments, as well as the replenishment of currency reserves for current international payments. In addition to gold, freely convertible currency, the international unit of account SDR, is used as world money.
World money has three purposes: universal means of payment; universal means of purchasing and the materialization of social wealth. Money acts as an international means of payment in settlements on international balances (balance of payments). As an international means of purchase, money is used to directly purchase goods abroad and pay for them in cash. As a materialization of public wealth, they are a means of transferring national wealth from one country to another by collecting indemnities or providing loans.
3. Types of money.
Depending on whether money has real value, it is divided into:
· real money, having real value;
· signs of value that have no real value.
TO real money relate:
1) full-fledged coin - a silver or gold coin, the denomination of which corresponds to the value of the gold contained in it;
2) banknotes exchangeable for gold are bank notes that were issued by large commercial banks, subject to the availability of gold bullion. According to the 1st requirement, banknotes had to be exchanged for gold.
TO signs of value relate:
1) a small change coin is a small metal coin, the denomination of which does not correspond to the value of the metal contained in it.
2) paper money is money issued by the Treasury at the request of the Russian government to cover budget expenses. Their release is not determined by the needs of trade turnover and therefore leads to inflation. This money is not backed by anything and there is no mechanism for withdrawing it from circulation. Therefore, they are constantly depreciating, especially as confidence in the Government declines. Paper money takes the form of treasury notes.
3) credit money - issued into circulation by the Central Bank when lending to the Government and commercial banks. When the loan is repaid, the corresponding amount is withdrawn from circulation, i.e. There is a mechanism for withdrawing credit money. Loan money is secured because When issuing a loan, the Central Bank requires collateral. Credit money has the form of banknotes if they exist in cash. They can exist in non-cash form.
Depending on whether money has a visible form, it is divided into cash and non-cash money.
Cash is money that has a visible form.
Non-cash money- this is money that does not have a visible form and exists in the form of entries in bank accounts.
Non-cash money It is customary to classify according to the degree of their liquidity. Under liquidity refers to the ability of money to quickly make payments.
1) The most liquid is cash, but it is also the most unprofitable type of asset that does not generate income.
2) Deposits on demand - these are balances on current, current and other customer accounts that can be withdrawn upon request.
3) Deposits with a maturity of up to 1 year - time deposits with a period of 2, 5, 9 months.
4) Deposits for a period of more than 1 year - funds not intended for use in current trade turnover; they will be used in future trade turnover.
4. Forms of issuing money. The impact of money emission on price inflation
Inflation - translated from Latin, “inflation” means “inflation”, and is associated with the excessive release of unsecured paper money into circulation.
Inflation first appeared due to the abolition of the gold coin standard. During that period, conditions were created for a constant and sharp rise in prices, as well as an increase in budget expenditures due to deficit financing, which contributed to the depreciation of money.
Modern inflation associated not only with the depreciation of money as a result of rising prices, but also with the critical state of the economy as a whole. The main cause of inflation is a violation of the proportions between various spheres of the economy: accumulation and consumption, supply and demand, government income and expenditure, sources of loan capital and their use, the amount and money supply in circulation and the economy's needs for money.
Modern inflation is born in the reproductive process itself, but its concrete manifestation is found in the monetary sphere. In this case, inflation that arises due to monetary factors is called demand inflation, and not monetary inflation - cost inflation.
TO demand inflation may lead to an increase in military spending, a state budget deficit and an increase in domestic debt, the issue of national currency in excess of the needs of trade turnover. TO cost inflation- a decrease in labor productivity growth and a fall in production, an energy crisis associated with a sharp rise in oil prices, rising prices and wages with slow growth in labor productivity.
Main forms stabilization of monetary circulation associated with inflation processes are monetary reforms and anti-inflationary policies.
Currency reform- This a complete or partial transformation of the monetary system carried out by the state in order to stabilize monetary circulation.
As a tool monetary reforms, the state can use nullification, restoration, devaluation, denomination and shock therapy.
Nullification - declaration by the state of depreciated banknotes as invalid.
Denomination - enlargement of the scale of prices by “crossing out zeros” on banknotes.
Restoration - this is the restoration of the previous gold content of the monetary unit.
Shock therapy methods - were widely used in international practice during the transition from state to market economies. During “shock therapy,” such harsh measures as freezing wages, reducing production, increasing unemployment, etc. are used.
Anti-inflationary policy - This is a set of measures for state regulation of the economy aimed at combating inflation.
Deflationary policy- these are methods of limiting money demand through monetary and tax mechanisms by reducing government spending, increasing the interest rate on loans, and limiting the money supply. This policy causes a slowdown in economic growth and even crisis phenomena.
2. MONETARY CIRCULATION AND MONETARY SYSTEM
1. The concept of money circulation. Cash and non-cash circulation
Money turnover - this is the movement of money when they perform their functions in cash and non-cash forms, serving the sale of goods, as well as non-commodity payments and settlements in the household.
Cash turnover represents a set of payments for a certain period of time and reflects their movement as a medium of exchange and means of payment.
The scope of use of cash is mainly related to the income and expenses of the population:
· settlements between the population and enterprises retail And Catering;
· remuneration by enterprises;
· depositing money by the population into deposits and receiving them from deposits;
· payment of pensions, benefits, scholarships, insurance compensations;
· payment for securities and payment of income on them;
· payments for utilities and housing services;
· payment of taxes to the budget by the population.
Non-cash turnover serves settlements carried out between:
· legal entities of different forms of ownership;
· legal entities and individuals for the payment of wages, income from deposits, securities, and issuance of loans;
· legal entities and individuals and executive authorities of all levels for the payment of payments to the budget and extra-budgetary funds, as well as when receiving funds from the budget;
· banks and various financial institutions and the population.
That. money all the time move from one sphere to another: cash, when deposited into accounts at credit institutions, becomes non-cash, and when withdrawn from the account, it again becomes cash.
Forecasting cash turnover is carried out on the basis of forecasts of cash turnover, reflecting the volume and sources of receipts of all cash in the cash desks of banks and issuance to organizations, institutions and individuals, taking into account the emission result or withdrawal of money from circulation. The process takes place in stages:
Stage 1: includes the preparation by credit institutions of forecast calculations of expected receipts of cash at cash desks and their issuance based on time series and the “Report on Cash Turnovers of Bank of Russia Institutions” or on the basis of basic applications received from serviced enterprises. The forecast is compiled quarterly, distributed by month, and sent to a correspondent account with the Bank of Russia two weeks before the forecast quarter.
Stage 2: Having received the forecast, the Central Bank of the Russian Federation, quarterly with a distribution by month, prepares forecasts of cash turnover in terms of income, expenses and emission results for the credit institutions served based on an analysis of the turnover of cash passing through their cash desks, and a week before the start of the quarter sends to the territorial offices of the Bank of Russia, settlement the cash desks of which use them when drawing up applications to reinforce the working cash register.
Forecast emission calculations money are taken into account when developing measures to organize cash circulation in the country.
Table 2.1
Cash turnover forecast
Non-cash turnover makes up a significant part of the country's monetary turnover, which contributes to the concentration of monetary resources in banks.
The importance of non-cash payments is that when they expand, the amount of cash required for circulation is significantly reduced, and therefore, circulation costs in the form of costs for the production, transportation, storage and destruction of money are reduced.
Non-cash turnover is usually divided into two types:
Commodity turnover - payment for goods by individuals and legal entities;
Non-commodity turnover - payments in the process of formation and distribution of national income, lending, insurance, as well as in the form of other non-commodity payments.
Modern non-cash turnover in the Russian Federation is organized in accordance with several basic principles:
1. Enterprises of all forms of ownership are required to keep their funds in bank accounts. Business cash registers are only allowed to hold small amounts of cash within the limit.
2. The bulk of non-cash payments should be made through a bank.
3. Request for payment must be made either before or after shipment.
4. Payment by a bank client for goods and services received is carried out only with the consent of the legal entity or individual being served.
5. The forms of non-cash payments allowed by the regulations of the Central Bank of the Russian Federation are chosen by the enterprise at its own discretion.
Compliance with these principles allows you to maintain the legality of the monetary turnover.
Cashless payments are carried out on the basis of settlement documents established by the Central Bank of the Russian Federation and in compliance with the rules of the relevant document flow. The main types of payment documents in the Russian Federation when making non-cash payments are: payment orders, payment requests, checks, letters of credit, collection orders, plastic cards, etc.
Payment order - settlement document, containing the payer’s order to the bank serving him to transfer funds from his account to the account of the recipient of the funds. When making non-cash payment orders, the initiative for payment belongs to the payer.
Payment request - a settlement document that the recipient of funds submits to the bank serving him for collection, i.e. containing a requirement for the payer to pay a certain amount through the bank. When organizing settlements with payment requirements, the initiative for payment belongs to the recipient of funds, and not to the payer, as in the case of a payment order.
Collection order - a settlement document drawn up by a bank or enterprise when they are granted the right to indisputably write off funds.
Payment order, payment request and collection order are traditionally combined in financial theory with one term “orders of approval”. All these documents are not negotiable, i.e. their assignment to a third party is not intended.
Letter of Credit - a conditional monetary obligation of the bank, issued by it on behalf of the client (payer) in favor of its counterparty under the agreement (recipient).
Bank opening letter of credit(issuing bank), may make payment, pay, accept or honor a bill of exchange or delegate authority to another bank to carry out such transactions, subject to the provision of the documents provided for in the letter of credit and subject to the fulfillment of all its conditions.
One of the most dynamic tools for non-cash payments is a plastic card.
2. The law of monetary circulation. Money supply and velocity of money
Law of money circulation establishes the amount of money needed to perform the functions of a medium of circulation and a means of payment. The amount of money required to perform the functions of money as a means of circulation depends on three factors determined by the conditions of production:
1) the number of goods and services sold on the market (direct connection);
2) the level of prices of goods and tariffs (direct connection);
3) speed of money circulation (inverse relationship).
This relationship was first established by K. Marx.
Amount of money to perform the function of a medium of exchange is defined as the ratio of the sum of commodity prices to the average number of turnovers of the same monetary units (money circulation velocity):
where K is the amount of money needed as a medium of exchange;
S is the sum of prices of goods and services sold;
C is the average number of turnovers of money as a medium of exchange (money circulation velocity).
Velocity of money is determined by the number of revolutions of a monetary unit over a certain period of time, since the same money constantly changes hands over a certain period, serving the sale of goods and the provision of services.
An increased money supply with the same volume of goods on the market leads to the depreciation of money, i.e., ultimately, it is one of the factors in the inflationary process.
Thus, the amount of money needed for circulation and payment is determined by the following conditions:
a) the total volume of goods and services in circulation (direct relationship);
b) the level of commodity prices and tariffs for services (the relationship is direct: the higher the prices, the more money is required);
c) the degree of development of non-cash payments (feedback);
d) the speed of circulation of money, including credit (inverse relationship).
With the emergence of functions money as a means of payment, formula (2.1) becomes somewhat more complicated, and the law determining the amount of money in circulation takes on the following form:
K=(S 1 -S 2 +S 3 -P) / C, (2.2)
where S 1 is the sum of prices of goods and services;
S 2 - the sum of prices of goods sold on credit;
S 3 - amount of payments on obligations;
P - mutually extinguishing payments.
When handling metal the amount of money in circulation was regulated automatically, using the functions of money as a treasure, i.e. if the need for money decreased, then the excess money went into treasures; if it increased, there was a reverse influx of money.
Based on this observation, K. Marx formulated the law of paper money circulation: paper money should be put into circulation in the same quantity as the gold it replaces would circulate. The issue of paper money in large quantities leads to a disorder in monetary circulation and to inflation. The law had no practical application in capitalist economic conditions, but the monetary system of the Soviet Union was built on this principle.
Money supply is the most important quantitative indicator of money circulation and represents the total volume of purchasing and payment instruments serving economic turnover. The amount of fiat credit money should be determined by the value of all valuables in the country through money capital.
To analyze quantitative changes monetary circulation uses special groupings of assets - monetary aggregates, distributing the money supply according to the degree of liquidity. Each subsequent mass indicator includes the previous one, plus a new amount of financial assets according to the degree of liquidity (Table 2.2).
Table 2.2
Structure of monetary aggregates in the Russian Federation
Analysis of the structure and dynamics of the money supply is of great importance when the Central Bank of the Russian Federation develops monetary policy guidelines.
Statistic indicator The money supply is the monetary base, which includes the MO aggregate, cash in banks' cash desks, as well as banks' required reserves with the Central Bank of the Russian Federation and their funds in correspondent accounts.
Change the volume of money supply can be the result of both a change in the mass of money in circulation and an acceleration of its turnover.
Velocity of money - this is an indicator of the intensification of their movement when functioning as a means of circulation and a means of payment. It is difficult to quantify, so indirect methods are used to calculate it, including:
· the speed of movement of money in the circulation of the value of a social product or the circulation of income as the ratio of the gross national product, or national income to the money supply (aggregates Ml or M2). This indicator indicates the connection between money circulation and processes economic development;
· money turnover in payment circulation is determined by the ratio of the amount of money in bank accounts to the average annual value of the money supply in circulation. This indicator indicates the speed of non-cash payments.
Other indicators of the speed of money turnover are also used. In Russian practice, depending on the completeness of coverage of cash turnover, the following are distinguished:
· the rate of return of money to the cash desks of institutions of the Central Bank of the Russian Federation as the ratio of the amount of money received to the bank's cash desks to the average annual mass of money in circulation;
· the speed of circulation of money in cash circulation, calculated by dividing the amount of receipts and issues of cash (including post offices and Sberbank branches) by the average annual mass of money in circulation.
On the speed of money circulation influenced by general economic factors, such as the cyclical development of production, its growth rate, price movements, as well as monetary factors. Monetary factors include the structure of payment turnover (the ratio of cash and non-cash money), the development of credit operations and mutual settlements, the level interest rates for loans on the money market, as well as the introduction of computers for transactions in credit institutions and the use of electronic money in settlements. It also depends on the frequency of payment of income, the extent to which the population spends its funds, and the level of savings and accumulation.
3. The country's monetary system
Monetary system - the historically established structure of monetary circulation in the country, enshrined in national legislation. There are two types of monetary systems:
1) a system of metal circulation, which is based on real money (silver, gold), performing all five functions, and circulating banknotes are freely exchanged for real money.
2) a system of paper-credit circulation, in which real money is replaced by signs of value, and paper (treasury bills) or credit money are in circulation.
With metal In monetary circulation, two types of monetary systems are distinguished: bimetallism and monometallism, depending on how much metal is accepted as the universal equivalent and the base of monetary circulation.
Bimetallism - a monetary system in which the role of universal equivalent is assigned to two metals (silver and gold). Free coinage and unlimited circulation are provided for. There were two price scales for goods on the market. This system does not ensure the stability of monetary circulation, since a change in the value of one of the monetary metals leads to fluctuations in the prices of goods.
The need for stability of the monetary system, a single universal equivalent, led to the transition to monometallism.
Monometalism - a monetary system in which one metal (silver or gold) serves as a universal equivalent. Under this system, there are coins made of one precious metal and tokens of value exchanged for coins.
In most developed countries, already at the end of the 19th century, bimetallism and silver monometallism were replaced by gold monometallism (in particular, in Russia since 1897).
There are three types of gold monometallism:
Gold coin;
Gold bullion;
Gold exchange standards.
Gold coin standard(corresponding to the period of free competition and development of production, credit system and trade) was characterized by gold circulation, free coinage, unhindered exchange of banknotes for gold, and not prohibited movement of gold between countries. However, this standard required the availability of sufficient gold reserves in issuing centers. First World War, which required large military expenditures, caused an increase in the budget deficit of the warring states and led to the abolition of the gold coin standard in most countries.
After the end of the First World War reduced forms of gold monometallism are introduced: the gold bullion standard (Great Britain, France), under which banknotes were exchanged for gold bullions, and the gold exchange standard (Germany, Austria, Denmark, Norway, etc.), under which banknotes were exchanged for mottos (means of payment in foreign currency) , exchanged for gold. As a result of the global economic crisis (1929-1933), all forms of gold monometallism were eliminated and a system of paper-credit money, not exchangeable for real money, was established. The paper-credit money system provided for the dominant position of banknotes issued by the country's issuing center.
Modern monetary systems developed countries, despite their characteristics, have many common features. They include the following elements: the monetary unit, the scale of prices, the types of money that are legal tender, the emission system and the state apparatus for regulating monetary circulation.
Currency unit- This a monetary sign established by law that serves to measure and express the prices of all goods and services. It is usually divided into small proportional parts. Most countries use a decimal system (1 US dollar equals 100 cents).
Price scale - the choice of the country's monetary unit and a means of expressing the value of a product through the weight content of the monetary metal in this selected unit.
Emission - release of funds and securities into circulation. The issue of funds is regulated by law and carried out by the state, which distributes this function between the central bank and the treasury. The Central Bank issues credit money - bank notes (banknotes). The Treasury issues treasury notes and change coins.
Depending on who issues money, there are two forms of issue:
· budget- is the issue of paper money carried out by the Treasury at the request of the country's government to cover budget expenses. The issue of money is not determined by the needs of trade turnover and therefore leads to inflation. This money is not backed by anything and there is no mechanism for withdrawing it from circulation. Therefore, they are constantly depreciating, especially as confidence in the Government declines. Paper money takes the form of treasury notes.
· credit- is the issue of money carried out by the Central Bank when lending to the Government and commercial banks. When the loan is repaid, the corresponding amount is withdrawn from circulation, i.e. There is a mechanism for withdrawing credit money. Loan money is secured because When issuing a loan, the Central Bank requires collateral. Credit money has the form of banknotes if they exist in cash. They can exist in non-cash form.
Types of money, which are legal tender, are credit money and, first of all, banknotes, small change, as well as paper money (treasury bills). Thus, in the USA, bank notes in circulation are 100, 50, 20, 10, 2 and 1 dollar; Treasury notes issued by the U.S. Treasury in $100 units, as well as silver-copper and cupro-nickel coins in the $1, 50, 25, 10, and 1 cent coins.
In economically developed countries, as a rule, government paper money (treasury notes) are not issued or are issued in limited quantities. In underdeveloped countries they have fairly wide circulation.
Emission system- legislatively established order issue and circulation of credit and paper banknotes. Issuance operations (issue and withdrawal of money from circulation) in states are carried out by:
The central bank issues banknotes in three ways:
· providing loans to credit institutions in the form of rediscounting bills of exchange;
· lending to the treasury secured by government securities;
· issuing banknotes by exchanging them for foreign currency.
In many industrialized countries under the influence of increasing inflation and the growing crisis in the economy, targeting has become widespread - the establishment of targets in order to regulate the increase in the money supply in circulation and credit, which should guide central banks. Central Bank in agreement with government agencies determines the amount of increase in the money supply, limiting it to growth in real terms.
This measure is being considered as an important form of combating inflation and ensuring economic stability. In the USA, all four monetary aggregates (Ml, M2, M3, M4) are targeted, but in France only M2. However, this form of regulation has shown poor effectiveness and a number of countries have abandoned targeting (Canada, Japan).
Monetary system Russian Federation operates in accordance with Federal law on the Central Bank of the Russian Federation (Bank of Russia) dated April 12, 1995, which determined its legal basis.
Official currency(currency) in our country is the ruble. The introduction of other monetary units on the territory of the Russian Federation is prohibited. The relationship between the ruble and gold or other precious metals is not established by law. The official exchange rate of the ruble to foreign monetary units is established as a result of trading on the Moscow Interbank Currency Exchange (MICEX) and is published in the press.
Exclusive right The Central Bank of the Russian Federation is responsible for issuing cash, organizing its circulation and withdrawal on the territory of the Russian Federation. He is responsible for the state of monetary circulation in order to maintain normal economic activity in the country.
Types of money Banknotes and metal coins that have payment power are banknotes and metal coins. Samples of banknotes and coins are approved by the Central Bank of the Russian Federation, a message about the release of their new samples and their descriptions are published in the media mass media. They are mandatory for use at their face value throughout the country and for all types of payments, as well as for crediting to accounts and deposits for transfer. The period for withdrawal of old banknotes should not be one year, but not more than five years. When exchanging, any restrictions on the amounts and subjects of exchange are not allowed. Banknotes and coins may be declared invalid (no longer valid as legal tender) by law. Counterfeiting and illegal production of money are punishable by law.
In order to organize money circulation, the Central Bank of the Russian Federation is entrusted with the following obligations:
Forecasting and organizing the production, transportation and storage of banknotes and coins, as well as the creation of their reserve funds;
Establishment of rules for storage, transportation and collection of cash for banks;
Determination of signs of solvency of banknotes and the procedure for replacing damaged banknotes and coins, as well as their destruction;
Development of a procedure for conducting cash transactions for credit institutions;
Organization and regulation of non-cash payments;
Licensing of settlement systems of credit institutions.
Cash are issued into circulation on the basis of an emission permit - a document issued by the Board of the Central Bank of the Russian Federation within the limits of the amount of money issued into circulation established by the Government of the Russian Federation.
The Central Bank of the Russian Federation and the Government of the Russian Federation are developing and implementing a unified state monetary policy aimed at protecting and ensuring the stability of the ruble.
3. FINANCE AND FINANCIAL SYSTEM
1. The essence and functions of finance
The term "finance"(from Latin Financia - income, cash) first began to be used in the 13th - 15th centuries in the trading cities of Italy. Subsequently, the term “finance” gained international distribution and began to be used as a concept associated with the system of monetary relations between the population and the state regarding the formation of funds of funds.
The emergence of finance is due to the emergence of the state and is due to the fact that the state performed a number of socio-political and economic functions, such as protecting borders and public order, constructing public buildings, waging wars, etc. Consequently, certain resources were needed to perform these functions.
With the development of society The influence of the state on the economy is increasing, which is accompanied by the development of the public finance system. At the same time, various kinds of financial intermediaries appear that accumulate and redistribute free funds from businesses and savings of the population. The scope of finance is expanding, the term “finance” goes beyond public finance and covers new areas (enterprise finance and household finance).
Finance - This system of economic relations regarding education , distribution and use of cash income in the form of cash funds from the state, business entities and the population.
The essence of finance as an economic category is that finance always has a monetary form of expression. Required condition the existence of finance is the real movement of funds, and the reason is the need of all entities for funds for their functioning. But finance differs from money, both in content and in the functions it performs. Money is the universal equivalent by which labor costs are measured. Finance is economic instrument distribution of redistribution of national income, a means of controlling the formation and use of funds.
The main task of finance is to provide financial and credit resources to the real sector of the economy.
Financial resources - this is the totality of funds at the disposal of business entities, the state or the population, i.e. money servicing financial relations.
Financial resources accumulated by the state are called centralized and are formed from tax revenues and non-tax revenues, as well as payments from the population. The resources remaining at the disposal of enterprises are called decentralized and are formed from the cash income and savings of the enterprises themselves.
The essence of finance as an economic category is manifested in the functions it performs.
Distribution function is the main one. The subjects of distribution are legal entities and individuals at whose disposal funds for special purposes are formed. The objects of the distribution function are the value of the gross domestic product and part of the national wealth. Finance serves different stages of GDP distribution, participating in both its primary distribution and redistribution.
Financial method distribution covers different levels of economic management: federal, regional and local. It is characterized by a multi-stage nature, giving rise to different types of distribution - intra-farm, intra-industry, inter-industry, inter-territorial, interstate. Through finance, the state influences not only the redistribution of national income between the production and non-production spheres and within these spheres, but also on production, capital accumulation, and the sphere of consumption.
In general, the distribution function of finance allows:
· create trust funds of funds at the level of business entities, the state, the population, and local governments;
· strengthen the state;
· develop the productive forces of society;
· create reserves at the level of an economic entity, the state, as well as carry out savings by citizens.
Control function finance is determined by their property of serving as a means of controlling the process of cost distribution and redistribution of the social product. The content of the function is to ensure control over the movement and formation of material assets in society, as well as the distribution and use of funds. Financial control operates during the movement of money and capital through systems and forms of payment, credit, taxation, collateral, etc.
One of the tasks of financial control- checking compliance and legislation on financial matters, timeliness and completeness of fulfillment of financial obligations to the budget system, tax service, banks, as well as mutual obligations of business entities for settlements and payments.
Regulatory function finance. This function is associated with government intervention through finance (public spending, taxes, public credit) in the reproduction process.
All functions finances operate simultaneously. In their unity and interaction, finance can manifest itself as a category of value distribution.
2. Financial system and its links
Financial system - is a collection various fields financial relations, characterized by the peculiarities of the formation and use of funds of funds and a different role in other reproduction.
Financial system is a unified system because it is based on a single source of resources - national income. The division of the financial system into separate links is due to the peculiarities of the functioning of economic entities of society, differences in the methods of distribution and use of funds.
The functioning of all links is subordinated to a common goals - mobilization of financial resources and their further distribution and redistribution.
Rice. 3.1. Links of the financial system of the Russian Federation
The financial system of the Russian Federation includes the following links financial relations:
· state budget system;
· off-budget special funds;
· state loan;
· insurance funds;
· finance of enterprises of various forms of ownership.
Therefore, financial The Russian system consists of three large areas: national finance, finance of business entities and insurance finance (Fig. 3.1).
National finance - these are centralized funds of funds that are created through the distribution and redistribution of national income created in the sphere of material production. The main purpose of this area is the centralization of funds to regulate the economy and solve social problems at the level of the national economy.
Finance of business entities - these are decentralized funds of funds that are formed from the cash income and savings of the enterprises themselves. The predominant share of the state's financial resources is formed here. Part of these resources is redistributed to budget revenues at all levels and to extra-budgetary funds. A key place among them belongs to the finance of commercial enterprises.
Insurance highlighted into a separate group due to the specifics of insurance relations, including the mechanism for the formation of funds of insurance organizations, their use by methods different from those used in other areas of financial relations.
Accumulation process and placement of financial resources carried out in the financial management system of the country and business entities is directly related to the functioning of financial markets and institutions.
If the task financial institutions is to ensure the most efficient movement of funds from owners to borrowers, the task of financial markets is to organize trade in financial assets and liabilities between buyers and sellers of financial resources. Solving this problem is complicated by a number of objective reasons, since it is necessary to take into account the different interests of market participants, risks of fulfilling obligations, etc.
Buyers and sellers in financial markets are households, enterprises, and the state.
4. PUBLIC FINANCE
1. State budget and taxes
The state budget - the largest link in state finance, which is a form of formation and expenditure of funds that ensure the functioning of state power. The objective nature of budgetary relations is due to the fact that a certain part of the national income necessary to solve the tasks assigned to the state should be concentrated in the hands of the state.
Economic essence The budget is expressed in the system of financial relations between the state, self-government bodies, economic entities and the population on issues of life support for the activities of the state as a whole.
Social essence The budget is determined, on the one hand, by the level of the tax burden for certain groups of the population and economic entities, and on the other hand, by the direction of use of budget funds.
From a legal point of view budget- this is a document that takes the form of a law, a legal act, on the basis of which funds of funds are formed and spent to perform national functions, the functions of constituent entities of the Russian Federation and local governments.
The state budget is a special form of redistribution relations associated with the separation of part of the national income in the hands of the state in order to use it to meet the needs of the entire society. With the help of the state budget, national income (sometimes national wealth) is redistributed between sectors of the economy, spheres social activities, territories of the country. In addition, through the state budget, measures are taken for state financial regulation of the economy.
The state budget performs the following functions:
· Redistribution of national income;
· State regulation and stimulation of the economy;
· Financial support for social policy;
· Control over the formation and use of a centralized fund of funds.
In the relationship between the budget and the economy and society, two main problems are traditionally solved.
The first is so that when a significant part of the added value and property of economic entities is withdrawn, it does not deprive them of opportunities for entrepreneurship, simple and expanded reproduction. Manufacturers must have all the necessary conditions for effective business activities.
Second problem comes down to ensuring sufficient social protection of the disabled population.
Budget system - This a set of all types of country budgets based on economic relations and legal norms.
According to the Budget Code of the Russian Federation, the budget system consists of three levels:
I federal budget and state budgets off-budget funds;
II budgets of the constituent entities of the Russian Federation and budgets of territorial state extra-budgetary funds;
III - local budgets.
Budget process - these are the procedures for developing and executing budgets.
The budget process covers four stages of budgetary activity: drafting budgets; review and approval of budgets; execution of budgets; drawing up a report on the execution of budgets and their approval. All stages of the budget process are interconnected and are a direct reflection of the economic life of society.
Participants in the budget process are: President of the Russian Federation; bodies of legislative (representative) and executive power; monetary authorities; bodies of state and municipal financial control, as well as the main managers of budget funds.
Each participant The budget process has its own tasks and its own budgetary powers. Control over the execution of budgets is entrusted to the treasury authorities.
Budget formation is based on government revenues.
State revenues - This a system of monetary relations that is associated with the formation of financial resources at the disposal of the state and state-owned enterprises. Revenues serve as the financial base of the state.
Composition of government revenues largely determined by the methods by which the state accumulates the funds it needs. In conditions market economy the main methods of mobilization are taxes, loans and emissions.
Central location occupy in the state revenue system taxes, acting as the main instrument for the redistribution of national income and ensuring the mobilization of a significant part of financial resources (from 80 to 90%).
Taxes represent mandatory and gratuitous payments established by law and made by the payer in a certain amount and within a certain period. The essence and role of taxes are manifested in their functions: fiscal, regulatory and control.
Ratio of financial resources budgets depend on financial policy at each historical stage of the state’s development and are approved annually when the budget law is adopted. A large share federal budget characterized by the functions and purpose of this budget, which solves problems in the country as a whole (army, science, culture, space achievements and production). The federal budget accounts for 50% to 70% of financial resources. Territorial budget forms the resources of the region and solves territorial problems of the budgetary sector and municipal enterprises. It accounts for 20% to 50% of financial resources.
Local budgets They form the resources of a specific place of residence of the population (city, village), finance housing and communal services, preschool education, and municipal enterprises. It accounts for from 5% to 20% of financial resources.
All budgets operate autonomously: local budgets with their income and expenses are not included in the territorial budgets, and the latter are not included in the federal budget.
Second in financial terms important method of mobilizing government revenues are loans. This is due to the presence of a gap between tax revenues and budget expenditures. The issuance of loans forms public debt. Taxes serve as the financial basis for loan repayment.
Third method mobilization of government revenues serves paper money and credit emission. This is the most unpopular method, as it leads to an increase in the excess money supply and increased inflation.
Government spending- This monetary relations arising at the final stage of the distribution process in connection with the use of centralized and decentralized state revenues. The content and nature of government spending are directly related to the state’s economic, social, managerial, and military (defense) functions.
Government spending are being implemented different ways: financing and by providing loans and credits. The main method is financing, i.e. free and irrevocable provision of funds to different forms to carry out relevant activities.
Using public expenditures from any sources must comply with financial discipline, the principles of legality, efficiency and expediency.
The main areas of government spending include:
Social expenses - one of the most important species expenses, including expenses for health care, education, social security, social insurance. Approximately 3/4 of their total volume is financed from budgetary and extra-budgetary funds. IN last years The role of local finances in covering the costs of expanding social infrastructure and maintaining educational and health care institutions is significantly increasing. Expenses tend to increase due to the development of scientific and technological progress. State social spending finances activities that ensure the reproduction of the labor force, the qualifications of workers, pays unemployment benefits, etc.
Foreign economic expenses are related to the fact that the state in one way or another helps the manufacturer to break into the market. These are direct subsidies to companies from the budget, tax exemptions for exporters, provision of credit to an exporter or importer on preferential terms, export insurance, etc. This group also includes government costs for the implementation of various international treaties, cultural, scientific and other ties.
Economic costs are of great national economic importance. They contribute to the structural restructuring of social production, building up scientific and technical potential, modernizing enterprises and technical re-equipment of all sectors of the national economy. Investments play an important role. They are spent on financing infrastructure sectors (transport, communications, roads, land reclamation), which require huge capital investments. Economic expenses include
· financing of new progressive industries, such as nuclear energy and the space industry;
· financing of unprofitable industries (coal mining, agriculture);
· financing of research work, especially fundamental ones, which require a large concentration of financial resources.
National defense spending (military expenditures) are among the most important government expenditures. They include the costs of maintaining personnel; weapons; material and technical equipment; construction of military facilities; for military research and development; pension provision for military personnel and members of their families; personnel training; creation of reserves and reserves in case of war, etc. These are direct military expenses.
There are also indirect military costs, i.e. expenses associated with eliminating the consequences of the war. When forming a military budget, one should take into account its irrevocable and unproductive nature. Only spending on military research and development can indirectly bring economic benefits.
Management costs - includes expenses for the maintenance of legislative and executive bodies of state power, for the maintenance of the judiciary, law enforcement agencies and the prosecutor's office. Management costs are dominated by salaries, travel expenses, transportation and utilities, etc.
Costs of current servicing of internal and external debt - arise when a government loan is used to cover a budget deficit.
2. State extra-budgetary funds
Reforming the system public finance in the 90s of the 20th century in Russia was associated with the emergence of a system of extra-budgetary funds. Their creation was dictated by the need to urgently solve certain social and economic problems that are vital for society.
Off-budget funds- one of the methods of redistributing the national income of the state in favor of certain social groups population. They are created on the basis of relevant acts of federal authorities, which regulate their activities, sources of income, procedures and areas of use.
Directions for spending funds, received by extra-budgetary funds, are determined by the purpose of the funds, specific economic conditions and the content of the developed and implemented programs.
With the help of state extra-budgetary funds, a number of problems can be solved:
Providing social assistance and services to the population;
Ensuring the restoration and preservation of a person’s ability to work;
Impact on the production process;
Providing environmental protection measures.
Pension Fund of the Russian Federation(PFR) formed as an independent financial and credit institution for the purpose of managing pension provision. The main purpose is to preserve family income. The Pension Fund and its funds are state property of the Russian Federation, are not included in budgets or other funds and are not subject to withdrawal.
Pension Fund funds are generated according to the Regulations on the Pension Fund of the Russian Federation at the expense of insurance contributions from employers; insurance premiums for workers; allocations from the federal budget; part of the funds received as a result of capitalization (investment in securities) of temporarily available funds; voluntary contributions from legal entities and bank loans. Employers' insurance contributions to the Pension Fund are included in the cost of production (work, services).
Social Insurance Fund of the Russian Federation(FSS) was created with the aim of providing state guarantees in the social insurance system and increasing control over the correct and efficient spending of social insurance funds and is an independent state financial and credit institution. The main purpose is to ensure family prosperity in case of temporary disability, restoration of health (vouchers) or social benefits. The FSS is managed by the Government of the Russian Federation with the participation of all-Russian trade union associations.
The funds of the fund are generated from employers' insurance contributions; insurance premiums of citizens engaged in individual labor activity and those entitled to security under state social insurance; income from investing part of the temporary free funds of the Social Insurance Fund in liquid securities and bank deposits within the limits of funds provided for by the budget for the corresponding period; voluntary contributions from individuals and legal entities; allocations from the republican budget of the Russian Federation; other income.
Compulsory Health Insurance Fund(MHIF) designed to accumulate funds for compulsory health insurance. Compulsory health insurance provides all citizens of the Russian Federation with equal opportunities to receive medical and pharmaceutical care at the expense of the Compulsory Medical Insurance Fund. To implement the health insurance policy with
Money is a very interesting phenomenon in our society. For some people there are never enough of them, for others there is nowhere to put them. For some, they are a means of survival, and for others, they are a source of the most unimaginable entertainment, such as a dish of oysters encrusted with gold. Who invented them and when? What are the functions of money and its characteristics?
What is money?
Money is the universal equivalent of all benefits, goods and services. Or rather, the equivalent of their cost. The history of the origin of money in humanity goes back to ancient times.
If earlier precious metals acted as money, now, in modern conditions, banknotes express the obligations of the state or central state bank in the form of banknotes or coins. In itself, such money is worth nothing. It is the obligations of the state that give them value.
Functions of money
It is the purpose of money, its functions, that reveal the very essence of money. Standard classification identifies the following functions of money:
Measure of value. This is the ability of money to be the standard for all types of goods and services. The product may have different weight, texture, size, etc. physical characteristics and properties. Money is a universal meter, a measure of value, thanks to which you can compare two types of value and make a fair exchange.
Means of circulation. Money has such properties as speed and ease of exchange for any goods and services. They, acting as an intermediary, allow the manufacturer to sell goods at one point in time, and buy raw materials a day or week later in a completely different place. Money removes restrictions on exchange in time and space.
Instrument of payment. With money you can establish a debt and pay it off. If a product was borrowed, and subsequently the prices for it changed greatly, the amount of the debt will remain unchanged - after all, it is expressed in monetary units.
A means of storage. With the help of money it is possible to transfer your purchasing power into the future. This happens when we save money but do not spend it right away. This function is performed when money is not involved in circulation.
World money. World money appeared with the development of a system of international loans and foreign trade relations. Such funds act as a universal means of payment or a universal materialization of the wealth of world society.
Characteristics of money
If the functions of money reflect their essence, then their characteristics allow us to more accurately define the legal concept. There are the following public legal characteristics of money:
1. only coins and banknotes recognized by the state are considered money;
2. the production of money takes place in strict accordance with state standards and directly specialized institutions - mints;
3. The state sets the denomination of money arbitrarily, but it is expressed in national monetary units;
4. money is accepted throughout the territory of the country that issued it at face value;
5. Illegal production of money and its release into circulation is counterfeiting and entails criminal and administrative liability.
The national currency of the Russian Federation is the ruble. The issue of money, control over its circulation and withdrawal are carried out exclusively by the Central Bank of the Russian Federation.
Mezentseva Vasilisa
The essence of money as an economic category in evolutionary theory lies in resolving the contradictions between use value and value. At natural production the product satisfied the needs of the manufacturer, i.e. mattered as use value(the ability of a product to satisfy some needs). When producing a product for exchange, the commodity producer is interested primarily in its value and only secondarily in its use value, since if a product does not have a use value, then no one needs it and it cannot be exchanged. When exchanged, a product must have value for the producer and use value for the buyer. These properties of a product act as a unity of opposites: unity, since they are inherent in one product, and opposition, since the same product for one person cannot be both use value and value. In the monetary form of value, one commodity monopolizes for a long time the role of the universal equivalent. The use value of a commodity is externally hidden, but its general form of value remains.
- this is the ability of money to be exchanged for any goods and services.
Here the material essence and social significance of money is taken into account:
- the social abstract labor embedded in them, representing the basis of equivalence when measuring newly created value;
- as universal wealth, money represents the equivalent of real wealth in the exchange of goods and money.
The universal equivalent reflects the relationship of a commodity to money as a measure of value. Certain costs of social labor are, as it were, fixed in the form of a unit expressing the value of the goods in prices.
Thus, the essence of money lies in the fact that it serves as a universal equivalent in commodity circulation and an integral part of the economic activity of the state, relations between various subjects and authorities.
The essence of money lies in the fact that they represent a specific product in the function of a general equivalent. The essence of money is expressed in universal exchangeability, exchange value, materialization of labor time. As a result, money reflects social relations.
Money - it is a special commodity that expresses the value of all other goods and is exchanged for any of them. With the development of commodity production, the role of universal equivalent was assigned to noble metals (gold and silver), which served as money. Later they were replaced by modern money, which, acting in the form of a materialized type of universal equivalent of exchange value, ensures the stability of the circulation of goods. The existence of the law of social division of labor and the law of saving time influenced the evolution of the forms of money. The formative features were both the natural properties of a monetary commodity and the unformed commodity money that existed in the distant past (tools, livestock, slaves, jewelry). Money, like everything around us, is in constant change. Due to the determining importance of production (compared to circulation), changes in the sphere of material production are reflected in the conditions of exchange of goods, which, in turn, places new demands on money. The old type of money, which does not correspond to the new conditions of exchange, gives way to a more progressive type.
For many eras, the role of money as a universal equivalent in commodity circulation was played by a wide variety of objects and goods. Each exchangeable commodity was used equally for direct consumption and as an instrument for measuring value and circulation.
Different forms of money have several common properties:
- universal direct exchangeability for goods and services;
- measurement of value;
- maintaining value.
The problem of trust in money
Originally on role of universal equivalent in the process of exchange, a wide variety of goods were put forward: livestock, furs, valuable shells, natural metal ingots.
Fulfillment of the role of a universal equivalent by one or another product, i.e. recognition by all participants in the exchange of the value of a particular thing depended on the natural, historical, social, economic, and national characteristics of the region in which the exchange took place. But the main thing was different: all these features, traditions and habits collectively serve to create the prerequisites for sustainable trust to money. Trust in the money of all participants in commodity-money relations seems to be the most important condition for the progressive development of all economic relations in society. The problem of trust in money arose at the moment of their appearance, accompanied all stages and is still relevant in our time.
Forms of universal equivalents
In the process of development of commodity-money relations, forms of value emerged that express the value of goods. Long time(at the early stage of exchange) there was a simple, random form of value, when the equivalent was one random commodity. With intensive commodity exchange, several goods appeared as equivalents. As exchange goes beyond the local market, the universal equivalent is gold, which turns into money (the monetary form of value). The functions of money in the process of commodity exchange are based on the general law of economic development, which can be formulated as the law of the general division of labor and cooperation of its results.
Highlight five types of universal equivalent:
Commodity estimate type, in which livestock and slaves act as “money” as objects according to a simple counting principle. Among the Slavs, the role of money in ancient times was played by linen (or in ancient Slavic “platno”), from which scientists determine the origin of the words “pay”, “payment”;
Commodity-weight type. Initially, the role of money was played by perishable products of plant origin, then by metals. The appearance of this type is associated with the development of agriculture, since the principle of equal exchange requires not only simple counting, but also weighing. It is believed that the word “ruble” arose from the word “to chop” and appeared as a result of the division of silver payment bars;
Hammered type. First, metallic money appeared in the form of coins: gold, silver, and later billon coins, which were later replaced by paper and credit money. Coins turned out to be far from ideal money, because, firstly, exchange with the help of such money begins to slow down at some stage in the development of society, since an increase in the scale of production requires a constant increase in the amount of metal money, and this runs into the limitations and rarity of precious metals in nature; secondly, trade relations are constantly expanding, national and world markets are developing, the number and speed of trade transactions are increasing, and coins are bulky and subject to abrasion; thirdly, the use of precious metals for minting coins reduces the economic potential of the country, since they can find more rational use in sectors of the economy;
Emission type. It is associated with all types of signs of value, presented on special paper with certain attributes; The earliest banknote issues in Europe were carried out in Stockholm in 1661.
Deposit-electronic type. Signs of value embodied in bank deposits, credit cards and electronic money are expressed in correspondent banking relationships.
Piece money
Piece money is a stage in the development of commodity-money relations, when exchange did not go beyond the boundaries of specific geographic regions.
Ways to achieve trust in money were different at different stages. Initially, when the role of universal equivalent was played by piece money(furs, livestock, slaves, natural metal ingots, valuable shells), confidence access to such money was ensured by the fact that these goods - universal equivalents - had an unconditional value for the economy of a particular region. However, as they reached regional borders, the question arose about an equivalent product that would be trusted not only within a specific economic region as piece money, but across large economic-geographical territories and subsequently within. At the stage of economic relations going beyond the boundaries of individual geographic regions and territories, a universal product is gradually allocated to fulfill the role of a universal equivalent: . Mostly it was about valuable metals ( silver and gold), which historically sequentially or simultaneously played the role of money (in bullion and then in coins) within geographical regions (Europe, Northern and South America, Asia), states and national territories.
Metal money, having a high value in a small volume, created an incentive to accumulation money.
Basic properties of the product money
Money plays a role in commodity-money relations universal equivalent.
At the early stages of the development of commodity-money relations, the intermediary product does not yet have universal versatility.
The versatility of an intermediary product is the main accelerator of the development of commodity-money relations.
First historical property of money- to be a measure of the value of all other goods, and the first historical form of money- This is one of the goods for which the owners of all other goods are willing to exchange.
In order to become a universal intermediary commodity, money must have a number of special properties.
Product- the universal equivalent (money) must satisfy the following requirements: persistence, homogeneity, divisibility, high value in a small exchange. An additional requirement for the metal money that evolved into coins is malleability.
Evolution of money from piece k was associated with the special characteristics of the intermediary product. If a product was distinguished from the world of other goods to fulfill the role of a universal equivalent, then special requirements were imposed on it. Firstly, it had to be stored for a long time without changing other properties. Therefore, such piece goods as livestock, skins, food, slaves (people), although at some points they became money, did not maintain this status for long, since they did not have storability. The commodity “money” must also have homogeneity or the same value of its various parts. However, any form of piece money did not have uniformity, since it was difficult to objectively determine which part of the cattle, for example, was more valuable: the front or the back, or perhaps, on the contrary, they did not differ at all in their value. Determination of equal or unequal value of valuation various parts piece money is essential to fulfill the following requirement for a product - a universal equivalent - divisibility. The fact is that in the process of commodity exchange situations constantly arise when it is necessary to exchange not X goods A on Y goods IN, A 1/3X goods A on 1/3Y goods IN or 5X goods A on 5Y goods IN etc. In this case, how to divide or multiply the intermediary product (money) if it is heterogeneous? Therefore, divisibility is the property that is organically necessary for an equivalent product in order for it to become universal money. And finally, commodity exchange relations in their development involve the movement of large masses of goods, and, consequently, the money servicing them between regions and countries. Such movements of money are possible only if they have the property of portability, i.e. high value in small quantities. This property is inherent in metal money made from precious metals: gold and silver. Therefore, it was gold and silver bars that became historically the first form of universal money (Fig. 4).
As can be seen from Fig. 4, in the commodity world there are not many products that meet all five properties. More precisely, there is only one such product - metal money made from precious metals (gold and silver). The fact that they alone possessed all the properties necessary for goods to become money led to the fact that gradually the economies of all regions and states, regardless of their national-historical characteristics, began to be serviced by gold and/or silver bars.