Can digital currency solve inflation
Publish: 2021-04-21 07:12:18
1. 1. Its quantity is too small compared with the currency in circulation; 2. digital currency is generally not used to buy goods. So digital money will not inflate.
2. No, it can be said that 100% is a fraud. In fact, even bitcoin countries are not allowed to trade at present. It's better to speculate in stocks than to have that money
3. Digital currency is to replace the real currency to complete commodity transactions. Digital currency is more convenient, faster and more healthy than cash. It can not appreciate itself
4. Inflation is the price rise that causes the devaluation of a country's currency. The essential difference between inflation and general price rise: general price rise refers to the temporary, partial and reversible price rise of a certain commodity e to the imbalance of supply and demand, which will not cause currency devaluation; Inflation is a sustained, universal and irreversible rise in the prices of major domestic commodities that can cause the devaluation of a country's currency. The direct cause of inflation is that the amount of money in circulation in a country is greater than its effective economic aggregate
deflation is deflation: when the amount of money in circulation in the market decreases, the people's money income decreases, and the purchasing power decreases, which affects the prices and causes deflation. The long-term monetary tightening will restrain investment and proction, lead to the rise of unemployment rate and economic recession
these two are inflation and deflation respectively.
deflation is deflation: when the amount of money in circulation in the market decreases, the people's money income decreases, and the purchasing power decreases, which affects the prices and causes deflation. The long-term monetary tightening will restrain investment and proction, lead to the rise of unemployment rate and economic recession
these two are inflation and deflation respectively.
5.
The role of digital currency:
1. First of all, the central bank's digital currency can provide a huge data base for monetary policy and macro Prudential policy, so that the regulatory authorities can collect real-time trading books of different frequency and different institutions according to their needs, and it is complete and real. This information advantage can help the central bank use policy tools more accurately and flexibly
Secondly, the central bank's digital currency technology can track the flow of funds and help the regulatory authorities to comprehensively monitor and assess financial risks. Finally, the central bank's digital money technology is concive to the transmission of interest rate of monetary policy. Digital currency technology supports "point-to-point" payment and settlement, which can improve the liquidity of market participants. Only the digital currency of the central bank, which is generally accepted by the whole society, can radiate this advantage to the participants of different financial markets, so as to improve the liquidity of financial markets. This will make the term structure of interest rate smoother and the transmission mechanism of interest rate smoother 
extended data:
digital currency can be considered as a virtual currency based on node network and digital encryption algorithm. The core characteristics of digital currency are mainly reflected in three aspects: because it comes from some open algorithms, digital currency has no issuing subject, so no one or institution can control its issuing; Because the number of algorithm solutions is fixed, the total amount of digital currency is fixed, which fundamentally eliminates the possibility of inflation caused by the overuse of virtual currency; Because the transaction process needs the approval of each node in the network, the transaction process of digital currency is safe enough
6. This statement is not entirely right, at least incomplete. There are many kinds of measures to rece money supply, which must be combined with other measures to effectively alleviate inflation. Moreover, tightening the money supply itself does not mean recing the amount of money issued, which is too mechanical. The most important thing is to tighten the money supply through the central bank's price mechanism (i.e. interest), that is to say, recing the circulation rate of the issued money and making the amount of money relatively "less", rather than the state saying: printing less money
to take measures, we must first know the root cause of the problem. We do not say that many foreign economists have different explanations and measures for inflation, but China's inflation has its own characteristics and roots
in the face of inflation, we should first grasp its essence and find its root. It's true that Chinese style inflation is essentially a monetary problem. Since it is a monetary problem, it must be solved through the monetary policy of the central bank, which is also true. But there are many ways to resolve the Chinese style inflation, the most important is to tighten the money supply through the central bank's price mechanism (that is, interest), rece bank credit, and prevent a large number of bank funds from entering the real estate market and stock market. This is the source of China's current inflation. If this is not the case, let a large number of money into the two asset markets, let a large number of money into the two asset markets to push up their prices, then it is impossible to curb inflation.
to take measures, we must first know the root cause of the problem. We do not say that many foreign economists have different explanations and measures for inflation, but China's inflation has its own characteristics and roots
in the face of inflation, we should first grasp its essence and find its root. It's true that Chinese style inflation is essentially a monetary problem. Since it is a monetary problem, it must be solved through the monetary policy of the central bank, which is also true. But there are many ways to resolve the Chinese style inflation, the most important is to tighten the money supply through the central bank's price mechanism (that is, interest), rece bank credit, and prevent a large number of bank funds from entering the real estate market and stock market. This is the source of China's current inflation. If this is not the case, let a large number of money into the two asset markets, let a large number of money into the two asset markets to push up their prices, then it is impossible to curb inflation.
7.
Inflation means that the supply of money is more than the demand. Increasing the demand for money or recing the demand for money can solve the problem of inflation
monetary policy: raising the rediscount rate, raising the legal reserve ratio, and the central bank selling government bonds are all monetary policies, which can absorb a large amount of money in the society, rece the circulation of money in the society, and solve inflation
Fiscal policy: increase or decrease taxes, rece or expand government purchase and investment, rece or increase transfer payments are fiscal policies. Recing taxes can rece the burden of enterprises, expand reproction and increase the demand for money. Increasing government investment can expand employment, activate market vitality and increase the demand for money8. Inflation refers to the situation of currency devaluation and price rise caused by the issue of paper money exceeding the amount of money needed in commodity circulation. Inflation is a unique social and economic phenomenon under the condition of paper currency circulation
the reason of inflation
paper money is a pure currency symbol, which has no value, and only performs the function of circulation means instead of metal money; The circulation of paper currency should be limited by the amount of metal currency needed in circulation. If the circulation of paper currency exceeds the amount of metal currency needed in circulation, the paper currency will depreciate and the price will rise. Therefore, the currency devaluation and price rise caused by excessive paper currency circulation are the direct causes of inflation
types of inflation
① demand driven inflation. The excessive growth of aggregate demand exceeds the total supply of goods under the current price level, which leads to the general rise of prices. The excessive growth of aggregate demand is characterized by the continuous increase of money supply over the supply of social goods e to the expansion of investment and consumption, which is also called excessive demand inflation< (2) cost driven inflation. The general rise in prices caused by rising costs. The factors that lead to the increase of cost are: firstly, the increase of material consumption; secondly, the increase of wages exceeds the increase of labor proctivity< (3) structural inflation. Because of the imbalance of social and economic sector structure, prices generally rise. This type of inflation is generally more prominent in developing countries. There are mainly three situations:
first, excessive demand and insufficient supply of some domestic sectors, even some key bulk procts, lead to a sharp rise in prices, and only rise but not fall, and then spread to the prices of procts in other sectors, so that the general price level continues to rise
Second, the uneven development of labor proctivity in various sectors of the country leads to the increase of monetary wages in the sectors where labor proctivity has increased rapidly, and then the monetary wages in other sectors will also increase, which will lead to the rise of prices and the general rise of prices
thirdly, when the proct prices of the open economic sectors tend to increase e to the influence of the international market price level, they will affect the non open economic sectors, resulting in the rise of the general price level< (4) imported inflation. Due to the rise in the prices of imported goods, domestic prices generally rise. This type generally appears in the case of global inflation, and spreads internationally through international trade, multinational companies, open economic sectors and other channels< (5) restraining inflation. When the total supply is less than the total demand or the structural imbalance between supply and demand exists in the market, the state compulsorily suppresses the stability of the total price level by controlling prices and commodity ration. This is a kind of inflation phenomenon that actually exists but does not occur
there are many reasons for the current price rise and inflation pressure increasing
1. The imbalance between supply and demand, such as the food instry, is demand driven inflation
2. Cost driven, such as the rise of international prices such as crude oil and iron ore, and the rise of domestic prices in these instries
3 Domestic investment is overheated, a large amount of liquidity flows to the real estate market, and excess liquidity leads to increased inflation pressure
4 The expectation of RMB appreciation makes a large amount of international capital flow into China.
RMB appreciation helps to ease the long-term huge surplus of China's international trade and relieve the pressure of excessive domestic liquidity, which can naturally ease inflation
the reason of inflation
paper money is a pure currency symbol, which has no value, and only performs the function of circulation means instead of metal money; The circulation of paper currency should be limited by the amount of metal currency needed in circulation. If the circulation of paper currency exceeds the amount of metal currency needed in circulation, the paper currency will depreciate and the price will rise. Therefore, the currency devaluation and price rise caused by excessive paper currency circulation are the direct causes of inflation
types of inflation
① demand driven inflation. The excessive growth of aggregate demand exceeds the total supply of goods under the current price level, which leads to the general rise of prices. The excessive growth of aggregate demand is characterized by the continuous increase of money supply over the supply of social goods e to the expansion of investment and consumption, which is also called excessive demand inflation< (2) cost driven inflation. The general rise in prices caused by rising costs. The factors that lead to the increase of cost are: firstly, the increase of material consumption; secondly, the increase of wages exceeds the increase of labor proctivity< (3) structural inflation. Because of the imbalance of social and economic sector structure, prices generally rise. This type of inflation is generally more prominent in developing countries. There are mainly three situations:
first, excessive demand and insufficient supply of some domestic sectors, even some key bulk procts, lead to a sharp rise in prices, and only rise but not fall, and then spread to the prices of procts in other sectors, so that the general price level continues to rise
Second, the uneven development of labor proctivity in various sectors of the country leads to the increase of monetary wages in the sectors where labor proctivity has increased rapidly, and then the monetary wages in other sectors will also increase, which will lead to the rise of prices and the general rise of prices
thirdly, when the proct prices of the open economic sectors tend to increase e to the influence of the international market price level, they will affect the non open economic sectors, resulting in the rise of the general price level< (4) imported inflation. Due to the rise in the prices of imported goods, domestic prices generally rise. This type generally appears in the case of global inflation, and spreads internationally through international trade, multinational companies, open economic sectors and other channels< (5) restraining inflation. When the total supply is less than the total demand or the structural imbalance between supply and demand exists in the market, the state compulsorily suppresses the stability of the total price level by controlling prices and commodity ration. This is a kind of inflation phenomenon that actually exists but does not occur
there are many reasons for the current price rise and inflation pressure increasing
1. The imbalance between supply and demand, such as the food instry, is demand driven inflation
2. Cost driven, such as the rise of international prices such as crude oil and iron ore, and the rise of domestic prices in these instries
3 Domestic investment is overheated, a large amount of liquidity flows to the real estate market, and excess liquidity leads to increased inflation pressure
4 The expectation of RMB appreciation makes a large amount of international capital flow into China.
RMB appreciation helps to ease the long-term huge surplus of China's international trade and relieve the pressure of excessive domestic liquidity, which can naturally ease inflation
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