Introduction I have on my schedule the writing of an article about the creation of money. Before starting this note, I watched a couple of videos about money and bonds. These presentations contain numerous errors that call the validity of the entire presentation into question. I want to offer some new information that readers can … Continue reading Money Creation Explained No. 1

Introduction If you believe that all dollars “are” money, I have a whole bag of dollars (about $165) that I will exchange for one $5 bill. Bag of Money I have used the image of shredded dollars to demonstrate that use determines what people do or do not use as “money.” The definitions of many … Continue reading Distinguish Between Money & Reserves

Introduction Last week, I published on The Free Market Center Journal an article entitled “Price Determination and Interest Rates”. In addition, on May 6, 2024, I published “How to Calculate Interest Rates.” These two articles provide support and an introduction to this week’s article about “Why The Fed Cannot Change Interest Rates.” This article has … Continue reading Why The Fed Cannot Change Interest Rates

Introduction I hear a lot of talk about the impending "debt crisis." Commentators seem to have a fixation on the Federal Debt-to-GDP ratio, yet I have never heard why they place such significance on it. The Federal Debt to GDP ratio actually compares a stock—the accumulation of flows over a long period—with a flow—the measure … Continue reading Federal Deficit and Monetary Expansion

Summary::Money does not measure value; people do. A bad cold has made editing my next article ("Federal Deficit and Monetary Expansion") a little difficult. I have decided to republish an article that I published several months ago. Some people argue that money—or a monetary unit e.g. dollars, pounds, lira—acts as a measure of value. A … Continue reading Money Not a Measure of Value Revisited

This title represents a trick question. Nothing "is" money. Usage determines what we call "money." Before I continue any further, I will repeat the definition of "money" that I use: Money consists of any economic good, or any claim on such a good, that serves as a general medium of indirect exchange and that acts … Continue reading What is Money?

Introduction I have written before that the only source of generalized price inflation consists of monetary expansion. The old saying about “too many dollars chasing too few good” does contain an element of truth. It does not, however, seem to contribute to a deeper understanding. The same people who frequently quote the old bromide often … Continue reading Where does inflation start?

The Fed or Banks? by Jim Berger, 6/2008 Updated 10/2025 Update I posted this article on a different channel in 2008. I decided to update and republish the content today, October 10, 2025. This article runs quite a bit longer than most of my publications. In addition, I have placed some rather technical modeling at … Continue reading Who Expands The Money Supply?

Introduction One big difference makes money distinct from all other economic goods. The consumption of money contributes nothing to human well-being. Having more money by itself does not make one's life better. The holder of money values it only because he can trade it for something the consumption of which will improve his well-being. Indirect … Continue reading Money: Not for Consumption

Introduction It would prove difficult to count the number of commentaries online and in the media that refer to "money," yet seldom, if ever, do you see a definitive definition of "money." They proceed with the discussion as if everyone agrees on what "money" means. When people do define money, they frequently confuse "money" with … Continue reading An Annotated Definition of Money