The concept and essence of money circulation. Concept and structure of money circulation
Concept money circulation
Changing the form of value (product to money, money to product), money is in constant movement between three subjects: individuals, business entities and government bodies. The movement of money when they perform their functions in cash and non-cash forms is money turnover.
The social division of labor and the development of commodity production are the objective basis of money circulation. The formation of national and world markets under capitalism gave a new impetus to the further expansion of money circulation. Money serves the exchange of the total social product, including the circulation of capital, the circulation of goods and the provision of services, the movement of loan and fictitious capital and income of various social groups.
The beginning of the movement of money is preceded by its concentration among subjects. They are concentrated in the wallets of the population, in the cash registers of legal entities, in accounts in credit institutions, and in the state treasury. For the movement of money to arise, there must be a need for money on one of the two sides. The demand for money arises when carrying out transactions; money is needed for circulation, payments for goods and services. Their volume is determined by nominal gross domestic product. The greater the total monetary value of goods and services, the more money is required to complete transactions. The demand for money is also driven by accumulation, which acts as different forms ah: deposits in credit institutions, securities, official government reserves.
Money circulation is carried out in two forms: cash and non-cash.
Cash circulation -- the movement of cash in the sphere of circulation and the performance of two functions by it (a means of payment and a medium of circulation). Cash is used:
- a) for the circulation of goods and services;
- b) for settlements not directly related to the movement of goods and services, namely: settlements for payment wages, bonuses, benefits, pensions; for payment of insurance compensation under insurance contracts; when paying for securities and paying income on them; on payments from the population for public utilities and etc.
Cash turnover includes the movement of the entire cash supply over a certain period of time between the population and legal entities, between individuals, between legal entities, between the population and government agencies, between legal entities and government agencies.
Cash movement is carried out using various types money: banknotes, metal coins, other credit instruments (bills, bank bills, checks, credit cards). Cash issuance is carried out by a central (usually state) bank. He issues cash into circulation and withdraws it if it has become unusable, and also replaces the money with new types of bills and coins.
Non-cash circulation -- movement of value without the participation of cash: transfer Money on accounts of credit institutions, offset of mutual claims. The development of the credit system and the appearance of customer funds in accounts in banks and other credit institutions led to the emergence of such treatment. Non-cash transactions are carried out using checks, bills, credit cards and other credit instruments.
Non-cash money turnover covers settlements between:
- a) enterprises, institutions, organizations of various forms of ownership that have accounts in credit institutions;
- b) legal entities and credit institutions for obtaining and repaying loans;
- c) legal entities and the population for the payment of wages and income from securities;
- d) individuals and legal entities with the state treasury for paying taxes, fees and other obligatory payments, as well as receiving budget funds.
The size of non-cash turnover depends on the volume of goods in the country, the price level, the payment system, as well as the size of distribution and redistribution relations carried out through financial system. Cashless circulation is important economic importance in accelerating turnover working capital, reducing cash, reducing distribution costs.
Depending on the economic content, two groups of non-cash circulation are distinguished: by commodity transactions And financial obligations.
The first group includes non-cash payments for goods and services, the second includes payments to the budget (profit tax, value added tax and other mandatory payments) and extra-budgetary funds, repayment of bank loans, payment of interest on loans, and settlements with insurance companies.
There is a relationship and interdependence between cash and non-cash circulation: money constantly moves from one sphere of circulation to another, cash changes form to accounts in a credit institution and back. Non-cash turnover occurs when cash is deposited into an account at a credit institution; therefore, non-cash circulation is unthinkable in the absence of cash. At the same time, cash appears to the client when he withdraws it from his account at a credit institution.
Thus, cash and non-cash circulation forms the general monetary circulation of the country, in which there is a single money of the same name.
Law of money circulation. Exchange equation
Commodity-money relations require a certain amount of money for circulation. Law of money circulation, discovered by Karl Marx, establishes the amount of money needed to perform the functions of a medium of circulation and a means of payment. K. Marx defines this quantity as follows:
During metal circulation, the amount of money was spontaneously regulated by the function of the treasure, i.e. The money supply increased and decreased, freely adapting to the needs of commodity production, the amount of money was always maintained at the required level. This ensured the stability of money circulation.
Obviously, in economics, cash payments spent on goods and services during a given period of time must be equal to all cash receipts from sellers of these goods and services over the same period of time. This useful concept was formulated by the American economist I. Fisher in the following exchange equation:
Here M is the total money supply, V is the velocity of circulation of money income, P is the weighted average price of all goods and services sold, and Q is the physical quantity of these goods and services. Thus, MV is the total cash payments to suppliers of goods and services, PQ is the total cash receipts of these suppliers, and the equality of these amounts is obvious.
Changing the form of value (product to money, money to product), money is in constant movement between three subjects: individuals, business entities and government bodies. The movement of money when they perform their functions in cash and non-cash forms constitutes monetary circulation.
The social division of labor and the development of commodity production are the objective basis of money circulation. The formation of national and world markets under capitalism gave a new impetus to the further expansion of money circulation. Money serves the exchange of the total social product, including the circulation of capital, the circulation of goods and the provision of services, the movement of loan and fictitious capital and income of various social groups.
The beginning of the movement of money is preceded by its concentration among subjects. They are concentrated in the wallets of the population, in the cash registers of legal entities, in accounts in credit institutions, and in the state treasury. For the movement of money to arise, there must be a need for money on one of the two sides. The demand for money arises when carrying out transactions; money is needed for circulation, payments for goods and services. Their volume is determined by nominal gross domestic product. The greater the total monetary value of goods and services, the more money is required to complete transactions. There is also a demand for money for accumulation, which comes in various forms: deposits in credit institutions, securities, official government reserves.
Money circulation is carried out in two forms: cash and non-cash.
Cash circulation is the movement of cash in the sphere of circulation and the performance of two functions by it (a means of payment and a medium of exchange). Cash is used:
- for the circulation of goods and services;
- for settlements not directly related to the movement of goods and services, namely: settlements for the payment of wages, bonuses, benefits, pensions; for the payment of insurance compensation under insurance contracts; when paying for securities and paying income on them; on household payments for utilities, etc.
Cash flow is carried out using various types of money: banknotes, metal coins, other credit instruments (bills, bank bills, checks, credit cards). Cash issuance is carried out by a central (usually state) bank. He issues cash into circulation and withdraws it if it has become unusable, and also replaces the money with new types of bills and coins.
In Russia, due to the enormous expansion of cash turnover in the last few years, attempts have been made to limit this turnover for legal entities. There is a cash limit for business entities. Every day they count all the money received and issued and credit it to the working cash register. If the balance of money at the end exceeds the established limit, then the amount above the limit is credited to the reserve fund. However, in practice these and other restrictions are still weak.
Non-cash circulation – movement of value without the participation of cash: transfer of funds to the accounts of credit institutions, offset of mutual claims. The development of the credit system and the appearance of customer funds in accounts with banks and other credit institutions led to the emergence of such treatment.
Non-cash transactions are carried out using checks, bills, credit cards and other credit instruments. Non-cash money turnover covers settlements between:
- enterprises, institutions, organizations of various forms of ownership that have accounts in credit institutions;
- legal entities and credit institutions for obtaining and repaying loans;
- legal entities and the population for the payment of wages, income from securities;
- individuals and legal entities with the state treasury for paying taxes, fees and other obligatory payments, as well as receiving budget funds.
IN Russian Federation the form of non-cash payments is determined by the rules of the Bank of Russia, operating in accordance with the law. It has been determined that settlements of enterprises of all forms of ownership for their obligations with other enterprises, as well as between legal entities and individuals for inventory items, are carried out, as a rule, by bank transfer through bank institutions.
Depending on the economic content, two groups of non-cash circulation are distinguished: for commodity transactions and financial obligations.
The first group includes non-cash payments for goods and services, the second includes payments to the budget (profit tax, value added tax and other mandatory payments) and extra-budgetary funds, repayment of bank loans, payment of interest on loans, and settlements with insurance companies.
There is a relationship and interdependence between cash and non-cash circulation: money constantly moves from one sphere of circulation to another, cash changes form to accounts in a credit institution and back. Non-cash turnover occurs when cash is deposited into an account at a credit institution; therefore, non-cash circulation is unthinkable in the absence of cash. At the same time, cash appears to the client when he withdraws it from his account at a credit institution.
Thus, cash and non-cash circulation forms the general monetary circulation of the country, in which there is a single money of the same name.
Money circulation is the movement of money in the internal economic turnover of the country, in the system of foreign economic relations, in cash and non-cash form serving the sale of goods and services, as well as non-commodity payments in the economy. The objective basis of money circulation is commodity production, where the commodity world is divided into two types of goods: goods themselves and goods-money. With the help of money in cash and non-cash forms, the process of circulation of goods, as well as the movement of loan and fictitious capital, is carried out.
From the process of money circulation, it is thus possible to isolate the concept of money turnover.
Money turnover is a manifestation of the essence of money in its movement. Money circulation covers the processes of distribution and exchange. Its volume and structure are influenced by the stages of production and consumption. Long manufacturing process, requiring an increased volume of inventories, increases the cash flow associated with their acquisition. The production of labor-intensive products relatively increases the size of the monetary turnover for wages and, accordingly, the monetary income of the population aimed at consumption.
An integral part of money circulation is payment circulation, in which money functions as a means of payment and is used to pay off obligations. Payment turnover is carried out both in cash and in non-cash forms. Thus, changing the form of value, money is in constant movement between three main subjects: individuals, legal entities and government bodies. And the movement of money when they perform all the main functions in cash and non-cash forms constitutes money circulation.
Monetary circulation combines both the main essential characteristics of money and the mechanisms and ways of using money to promote economic and social development countries.
The role of money circulation and its proper organization are manifested in the following points:
Well-established economic turnover and payment and settlement system;
The ability to ensure a balance of supply and demand on the commodity market, to prevent shortages of goods;
The nature and degree of influence of the money supply on price increases and inflation;
Chronic lack of funds among market participants for timely payment of wages and financing of working capital.
Money circulation is divided into two areas: cash and non-cash.
Cash and non-cash money circulation
Cash circulation- this is the movement of cash in the sphere of circulation and its performance of the functions of a means of payment and a means of circulation. It is served by banknotes, small change and paper money (treasury notes).
Cash is used: to carry out the circulation of goods and services; for calculations of wages and equivalent payments; for payment of securities and payment of income on them; for household payments for utilities, etc.
Cash turnover includes the movement of the entire cash supply over a certain period of time between legal entities, individuals and government agencies.
The procedure for carrying out cash circulation on the territory of the Russian Federation is regulated by the Regulations “On the rules for organizing cash circulation on the territory of the Russian Federation”, approved by the Bank of Russia.
In accordance with the Regulations:
Cash circulation is carried out using various types of money: banknotes, metal coins, credit cards, etc. (Table 1, Fig. 1);
The Central Bank of the Russian Federation issues and withdraws money from circulation;
The Central Bank of the Russian Federation regulates cash circulation in the Russian Federation;
For legal entities, bank institutions in which a legal entity's account is opened set a limit on the cash balance in the cash registers of legal entities;
Legal entities are obliged to unconditionally hand over all funds in excess of the established limits daily to bank institutions through joint cash desks at enterprises or through collection services of institutions and banks and independent services licensed by the Bank of Russia to carry out such operations;
For violation established order Serious penalties have been established for legal entities and their personal managers.
However, in practice, such restrictions, unfortunately, are still clearly insufficient.
Table 1
Amount, quantity and specific gravity banknotes and coins in circulation as of October 1, 2007.
Figure 1 - Change in the amount of cash in circulation
The specificity of methods for organizing cash circulation as an instrument of monetary policy is primarily due to the fact that, in addition to the maximum amount of cash settlements between legal entities, they do not have standards. Methods as a tool are not effective enough, since their effect is difficult to evaluate (track); they are not a quick response tool and rarely change. [ 15. p. 2]
In Russia, attempts are being made to limit cash circulation, because it allows you to escape state control over the activities of legal entities and individuals.
There is a close relationship between cash and non-cash circulation: money constantly moves from one sphere of circulation to another, cash changes form to accounts in a credit institution and back. Thus, cash and non-cash circulation forms a general monetary circulation in which a single money operates.
Non-cash circulation is the movement of value without the participation of cash, the transfer of funds to the accounts of credit institutions, the offset of mutual claims, etc.
Non-cash cash circulation reflects the change in cash balances in bank accounts, which occurs as a result of the bank’s execution of the account owner’s orders in the form of checks, plastic cards, payment orders and other payment documents.
Non-cash transactions are carried out using checks, bills, credit cards and other credit instruments.
Non-cash money turnover covers settlements between:
Legal entities various forms property with accounts in credit institutions;
Legal entities and credit institutions regarding the receipt and return of deposits and loans, as well as the payment of interest;
Legal entities and individuals for the payment of wages, interest on deposits and income from securities;
Legal entities, individuals and the state for paying taxes, fees, as well as receiving budget funds.
In the Russian Federation, the procedure for carrying out non-cash payments is determined by the Civil Code of the Russian Federation (Article 861-885), which regulates the essence and procedure for carrying out the main forms of non-cash payments.
In practice, the following forms of non-cash payments are used: payments by payment orders; settlements with payment requests and orders; payments by checks; settlements under a letter of credit.
Settlements between legal entities are carried out by banks and other credit organizations, and between banks - by cash settlement centers of the Central Bank of the Russian Federation.
In 2008 The Bank of Russia intends to continue working to improve the methodological and information base in the field of payment systems, carrying out measures to expand non-cash payments, as well as measures to reduce cash payments, monitoring the state of retail payments in the economy, carried out both in cash and non-cash.
Money circulation is the movement of money in internal circulation in cash and non-cash forms, serving the sale of goods, as well as non-commodity payments and settlements in the economy. The objective basis of money circulation is commodity production, in which the commodity world is divided into goods and money, giving rise to contradictions between them. With the deepening of the social division of labor and the formation of national and world markets under capitalism, money circulation receives further development. It serves the circulation and turnover of capital, mediates the circulation and exchange of the entire total social product, including the income of various classes. With the help of money in cash and non-cash forms, the process of circulation of goods, as well as the movement of loan and fictitious capital, is carried out.
Money circulation is divided into two areas: cash and non-cash. Cash circulation is the movement of cash in the sphere of circulation. It is served by banknotes, small change and paper money (treasury notes). In developed capitalist countries, banknotes issued by the central bank make up the overwhelming majority of cash circulation. A small part of the issue of money (about 10%) is accounted for by treasuries, which issue mainly coins and small denomination paper notes - treasury notes.
Non-cash circulation is a change in cash balances in bank accounts, which occurs as a result of the bank’s execution of the account holder’s orders in the form of checks, plastic cards, orders of approval, payment orders, electronic means of payment, and other payment documents. In some countries, treasury bills, certificates, and other instruments are used in circulation.
There is a close and mutual dependence between cash and non-cash circulation: money constantly moves from one sphere of circulation to another, changing the form of cash banknotes to a deposit in a bank, and vice versa. Receipts of non-cash funds into bank accounts are an indispensable condition for the issuance of money. Therefore, non-cash circulation is inseparable from the circulation of cash and together with it forms a single monetary circulation of the country, in which a single money of the same name circulates.
With the improvement of payment and settlement relations, the relationship between cash and non-cash areas of money circulation also changed. Until the end of the 19th century. cash payments predominated. IN modern conditions The share of cash, especially in industrialized countries, is small; for example, in the USA it is about 8%.
Monetary system
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The monetary system is the structure of monetary circulation in the country, which has developed historically and is enshrined in national legislation. The monetary system determines the currency in circulation in a given state.
There are two types of monetary systems: systems of metal circulation and systems of circulation of banknotes, when gold and silver are forced out of circulation by credit and paper money that cannot be exchanged for them. Metallic monetary circulation systems, in turn, are divided into bimetallic and monometallic systems. Bimetallic are monetary systems in which the state legislates the role of the universal equivalent (that is, money) for two noble metals, gold and silver. At the same time, free minting of coins from these metals and their unlimited circulation are carried out. In monometallism, the universal equivalent is one monetary metal (gold or silver). At the same time, other banknotes function in monetary circulation: banknotes, treasury notes, and small change. These banknotes are freely exchanged for monetary metal (gold or silver).
Gold monometallism is most widespread in the world. There are three types of gold monometallism: gold coin, gold bullion and gold exchange standards.
Under gold coin monometallism (which existed in Russia until 1914-1918), the prices of goods are calculated in gold, full-fledged gold coins function in the country’s internal circulation, and gold performs all the functions of money. Free minting of gold coins is carried out; all banknotes (banknotes, small change coins) are freely exchanged for gold; free export and import of gold and the functioning of free gold markets are allowed. After the First World War, instead of gold coin monometallism, gold bullion and gold currency (gold coin) types of monometallism were established. Under the gold bullion standard, banknotes and other money are exchanged only for bars weighing 12.5 kg; under the gold coin exchange, the exchange of banknotes and other money began to be carried out for the currency of the countries where exchange for gold bars was allowed. After 1929-1933 all forms of gold monometallism were eliminated, and after the Second World War, at the conference in Bretton Woods (USA) in 1944, the so-called Bretton Woods monetary system was formalized, characterized by the following features: gold is forced out of free circulation and acts only as a means of final payment between countries; Along with gold, the dollar (USA) and pound sterling (Great Britain) are international means and reserve currencies; Only reserve currencies are exchanged for gold according to the established ratio, as well as on free gold markets; interstate regulation of currency relations is carried out by the IMF (International Monetary Fund). The Bretton Woods monetary system was a system of international gold exchange monometallism based on the dollar.
In the 70s XX century Due to the reduction in gold reserves in the United States, this system collapsed. In 1976, the Bretton Woods monetary system was replaced by the Jamaican monetary system, formalized by the Agreement of the IMF member countries (Jamaica Island) in 1976 and ratified by the IMF member countries in 1978.
Under the Jamaican Monetary System, the Special Drawing Right (SDR) was declared the world's money and became an international unit. At the same time, the dollar retained an important place in international payments and foreign exchange reserves of other countries. In addition, the demonetization of gold was legally completed, that is, the loss of monetary functions by gold. At the same time, gold remains a state reserve; it is necessary to purchase the currencies of other countries.
At present there is no metal circulation in any country; The main types of banknotes are credit bank notes (banknotes), government money (treasury notes) and small change.
The official currency of Russia is the ruble. The official exchange rate of the ruble to foreign monetary currencies is determined by the Central Bank and published in the press. On the territory of Russia there is cash (banknotes and coins) and non-cash money (in the form of funds in accounts with credit institutions). The Bank of Russia has the exclusive right to issue cash, organize its circulation and withdraw on the territory of Russia.
2. THE CONCEPT OF MONEY CIRCULATION, ITS TYPES. LAW OF MONEY CIRCULATION.
2.1. Money circulation and its types
The most important component of the economy of any state is money circulation. The complex interweaving of various production, investment and trade processes, the inextricably linked processes of accumulation and investment of capital, the formation and use of credit funds, are ensured through money circulation.
Money circulation is the movement of money in the internal economic turnover of the country, in the system of foreign economic relations, in cash and non-cash form serving the sale of goods and services and non-commodity payments in the economy.
Another definition of money circulation:
Money circulation is the movement of money while performing its functions.
Money circulation is the movement of money between three groups of economic agents: consumers, enterprises and government authorities.
Cash turnover, based on the last definition, can be calculated as the sum of all payments made by economic agents in cash and non-cash form.
The following factors influence money circulation:
1) the state of the country’s economy;
2) functioning of the payment and settlement system in the country;
3) balance of market demand and supply;
4) money supply, i.e. the amount of money in circulation;
5) demand for money and supply of money;
6) inflation.
Cash turnover consists of the turnover of cash and non-cash money. Cash is money in the form of paper money, banknotes, small change metal coins. Non-cash money is money presented in accounts at credit institutions. There are two types of money circulation: cash circulation and non-cash circulation.
Cash circulation is the movement of cash in the sphere of circulation when it performs two functions: a means of payment and a medium of exchange.
Cash circulation is serviced by banknotes, small change metal coins and paper money.
Cash circulation serves relations between individuals, between legal entities, between individuals and legal entities, between legal entities and the state, between individuals and the state.
And accordingly, cash circulation is used in the circulation of goods and payment for services, in the payment of wages, pensions, various benefits, in the payment of income on securities, and the like.
The size of cash turnover depends on the price level in the country, on the volume of goods and services, and on the number of links in the payment system.
Cash circulation occupies a smaller part of money circulation (according to some estimates, it is about 10%). Moreover, there are further trends in a decrease in the volume of cash circulation in connection with the development of the non-cash payment system.
The organization of cash circulation involves the establishment of a strict procedure for issuing banknotes. Issuing functions in most countries are assigned to central and state banks. In Russia, the organization of cash circulation and the issue of money is carried out by the Bank of Russia (Central Bank of the Russian Federation).
Banknotes and coins issued by the Central Bank of the Russian Federation are unconditional obligations of the state and are backed by state assets; they are accepted at face value for all types of payments and for payment for all goods in the country. The flow of cash into circulation occurs in accordance with the needs of the economy, therefore issuing banks are often entrusted with the function of assessing and forecasting the development of production and the need for cash. In addition, the Central Bank of the Russian Federation regulates cash circulation.
When organizing cash circulation, we proceed from the following principles:
1) Centralization of the organization and regulation of money circulation.
According to this principle, the Central Bank has the exclusive right to organize and regulate the movement of cash, which makes it possible to achieve stability, uninterrupted monetary circulation, and take into account the purchasing power of the national currency. This principle is achieved thanks to regulatory documents regulating cash transactions of all business entities and credit institutions.
2) Elasticity and economy of money circulation.
According to this principle, since cash and non-cash money are based on the same credit money (credit basis), they can easily transform into each other, which makes it possible to elastically (significantly) shift the boundaries between cash and non-cash money circulation depending on economic needs. Following this principle, the state changes expensive cash circulation to cheaper non-cash circulation.
3) Complexity of the organization of money circulation.
According to this principle, it is necessary to ensure an integrated approach when organizing money circulation, i.e. consider both cash circulation and the movement of non-cash funds as a single whole. To implement this principle, a unified procedure for settlements through commercial banks is established by law. This procedure also improves the quality of cash management services.
4) Regularity and uninterrupted supply of cash to the economy. According to this principle, the Central Bank carries out timely issuance of cash and regulates the activities of commercial banks and credit institutions in order to influence their ability to timely service payments between business entities. This principle is implemented through emission and with the help of various instruments government regulation economy (issuing licenses, imposing sanctions for violations of legislation regulating money circulation).
5) Regulation of the procedure for performing cash transactions. IN in this case the state establishes the procedure for the operation of banks and business entities with cash, the procedure for posting cash and issuing it through the cash desk of a bank or business entity, and the procedure for documenting cash transactions. This order is established and reinforced regulatory documents Central Bank.
The main laws regulating cash circulation in the Russian Federation are:
Central Bank Regulation No. 56 “On the procedure for conducting cash transactions in credit institutions on the territory of the Russian Federation.”
Instruction of the Central Bank No. 93-I “On the procedure for opening by authorized banks of non-resident bank accounts in the currency of the Russian Federation and conducting transactions on these accounts.”
Regulations of the Central Bank “On the rules for organizing cash circulation on the territory of the Russian Federation.”
This last document determines that cash payments between legal entities are carried out, as a rule, in non-cash form and, as an exception, cash payments are allowed within the legally established limit for one transaction (RUB 60,000). For legal entities, a limit is established on the balance of cash in the cash register. Legal entities are required to deposit all funds in excess of the limit to the bank on a daily basis into their current account.
Non-cash circulation is the movement of value without the participation of cash by transferring funds to the accounts of credit institutions.
As a result of non-cash circulation, the balances of funds in the accounts of bank clients change. Non-cash circulation of checks, bills, plastic cards and other credit instruments is carried out.
Serves non-cash transactions between legal entities, legal entities and credit institutions, legal entities and individuals, individuals and credit institutions, legal entities and the state.
Non-cash transactions can be used just like cash to pay for goods and services, if various calculations and payments.
The volume of non-cash circulation is many times greater than cash circulation (90%). And this is no coincidence. Cashless transactions have some advantages, in particular:
1) allows you to save cash
2) allows you to reduce distribution costs, since the costs of printing and sending money are reduced
3) contribute to an increase in the speed of money circulation
In the Russian Federation, the procedure for making non-cash payments is determined by the following regulatory documents:
Regulations of the Central Bank “On non-cash payments” No. 2-P;
Federal Law “On the Central Bank of the Russian Federation”;
Federal Law “On Banks and Banking Activities”;
Federal Law “On the Procedure for Issuing Credit Institutions bank cards and making settlements for transactions carried out using them" No. 23-P.
According to the Civil Code of the Russian Federation, the following forms of non-cash payments are used:
Settlements by payment orders;
Payments by checks;
Calculations of payment requests-orders;
Payments using letters of credit.
The development of market relations in the economy required a change in the foundations of the non-cash payment system, including the principles of their organization:
The first principle of non-cash payments in market conditions management consists in their implementation through bank accounts, which are opened for clients for storing and transferring funds. In market economic conditions, settlements through a bank should be subject to economic feasibility, combined with the economic independence of market entities and their financial responsibility for their actions. It is important to emphasize that the first principle of non-cash payments in market conditions applies to both legal entities and individuals.
The second principle of non-cash payments is that payments from accounts should be made by banks on the orders of their owners in the order of priority of payments established by them and within the limits of the account balance. This principle enshrines the right of market entities to determine the order of payments from their accounts. This represents a significant step towards establishing the true economic independence of business executives. Further in the wording this principle Noteworthy is the lack of indication of the source of payment, which is also important for establishing the economic independence of the account owner at the disposal of the funds available to him in circulation and the responsibility for ensuring payment
The third principle is the principle of freedom for market participants to choose forms of non-cash payments and secure them in business contracts, with banks not interfering in contractual relations. This principle is also aimed at establishing the economic independence of all market entities (regardless of forms of ownership) in the organization of contractual and settlement relations and at increasing their financial liability for the effectiveness of these relationships. The bank plays the role of intermediary in payments.
The principle of urgency of payment means making payments strictly based on the terms stipulated in business, credit, insurance agreements, instructions of the Ministry of Finance of the Russian Federation, collective agreements with workers and employees of enterprises, organizations for the payment of wages or in contracts, labor agreements, contract agreements, etc. The economic meaning of establishing this principle is due to the fact that the recipient of funds is not interested in crediting them to his account, but rather within a pre-agreed, firmly fixed period. The introduction of the principle of urgency of payment is important practical significance. An enterprise and other subjects of market relations, having information about the degree of urgency of payments, can more rationally build their cash flow, more accurately determine the need for borrowed funds and will be able to manage the liquidity of their balance sheet.
The principle of security of payment is closely related to the previous principle of urgency of payment, since security of payment presupposes, in order to comply with the urgency of payment, the presence of the payer or his guarantor of liquid funds that can be used to pay off obligations to the recipient of funds. Depending on the nature of liquid funds, one should distinguish between operational and long-term security of payment. Operational security is determined by the presence of the payer or his guarantor with a sufficient amount of first-class liquid funds for payment (cash of a long-term, medium-term and short-term nature, as well as a form of their organization that guarantees timely repayment of the obligation). Prompt payment support may have various forms(including in the form of depositing funds at the expense of the client or bank for their subsequent transfer to the recipient).
The principle of security of payments creates a guarantee of payment, strengthens payment discipline in the economy, and, consequently, the solvency and creditworthiness of all participants in settlements. All calculation principles are closely related and interdependent. Violation of one of them leads to violation of the others.
2.2. Law of money circulation
World commodity-money relations, as well as in an individual country, require a certain quality of money for circulation. The amount of money needed for circulation is determined by the law of monetary circulation.
Such a law was discovered by K. Marx, the essence of which is expressed in the fact that the amount of money necessary to perform the function of a medium of exchange must be equal to the sum of the prices of goods sold, divided by the number of turnovers (velocity of circulation) of units of the same name.
In accordance with this law, the amount of money needed at any given moment for circulation can be determined by the formula:
D - the number of monetary units needed in this period for circulation;
C - the sum of prices of goods to be sold;
B - the sum of the prices of goods for which payments extend beyond the scope of the given period;
P - the sum of the prices of goods sold in previous years, the payment terms for which have come;
VP - the amount of mutually extinguished payments;
S.o. - rate of turnover of a monetary unit.
The speed of circulation of money is determined by the number of revolutions of a monetary unit over a known period.
The amount of money required to fulfill the function of money as a medium of exchange depends on three factors:
Quantities of goods and services sold on the market (direct connection);
Level of prices of goods and tariffs (direct connection);
Velocity of money circulation (inverse relationship).
All factors are determined by production conditions. The more developed the social division of labor, the greater the volume of goods and services sold on the market; The higher the level of labor productivity, the lower the cost of goods and services and prices.
The above formula can be presented in a simplified form:
M is the mass of goods sold;
C - average price of goods;
S.o. - average turnover rate (how many times a ruble turns over a year).
Transforming this formula, we obtain the exchange equation:
Which means that the product of the quantity of money and the velocity of circulation is equal to the product of the price level and the commodity mass. When crisis phenomena arise in the economy, this equality is violated and money depreciates, which can be expressed in the formula:
In the absence of a gold standard, the law of paper money circulation began to operate, according to which the number of tokens of value was equated to the estimated amount of gold money required for circulation.
In the context of demonetization of gold, i.e. loss of its monetary functions, the law of monetary circulation underwent modification.
The measure of the value of goods and services has become money capital, which measures value not on the market during exchange by equating goods with money, but in the production process - goods with goods. The issue of credit money without taking into account the real value of goods produced and services provided in the country in the process of production, distribution and exchange will inevitably cause a surplus, and ultimately lead to the depreciation of the monetary unit. The main condition for the stability of the country's monetary unit is the correspondence of the economy's need for money to its actual receipt in cash and non-cash circulation. Thus, we can say that: the law of monetary circulation is an objective economic law that expresses the need for the systematic use of part of the national income to expand and qualitatively improve the production process and increase national wealth. The material basis of accumulation is the excess of production over consumption.
One of the most important quantitative indicators of money flow is the volume of money supply. The money supply is a set of purchasing, payment and accumulated funds serving economic ties between individuals and legal entities, as well as the state.
To analyze quantitative changes in money circulation on specific date and for a certain period, as well as to develop measures to regulate the growth rate and volume of the money supply, various indicators (monetary aggregates) are used.
The following monetary units are used in Russia:
Aggregate M0 represents cash;
Aggregate M1 consists of aggregate M0 and funds in settlement, current, special, letter of credit, check accounts and the like, plus deposits in commercial banks, plus demand deposits in the Savings Bank;
Aggregate M2 contains aggregate M1 plus time deposits in Sberbank;
Aggregate M3 contains aggregate M2 plus certificates of deposit and government bonds.
There must be balance between the units. Otherwise, a violation of monetary circulation occurs. Equilibrium occurs under the condition M2>M1 and strengthens under M2+M3>M1.
The most important quantitative indicator of money circulation is the money supply, which is the total volume of purchasing and payment means serving economic turnover and owned by individuals, enterprises and the state.
The money supply is influenced by two factors:
The amount of money is determined by the state based on the needs of commodity circulation and the state;
The speed of money turnover is the time it takes for money to move as it performs the functions of circulation and payment.
The speed of circulation of money is influenced by general economic factors, that is, the cyclical development of production, its growth rate, price movements, as well as monetary factors (monetary), that is, the structure of payment turnover (the ratio of cash and non-cash money). In addition to general factors, the speed of circulation of money depends on the frequency of income payments, the uniformity of the population's spending of their funds, the level of savings and accumulation.
To sum up what has been said, we can conclude that general condition fully realizing the economic impact of money on development market economy are the stability and elasticity of money circulation.