Two Kinds of Money tangible intangible a coin

Two Kinds of Money tangible intangible a coin or note a bank deposit a medium of exchange commodity money exchange value intrinsically worthless and inconvertible endow fiat money all government-issued tokens + No constraint value the central bank of a country legal tender

Fiat money monetary base private sector base money The Fed securities from the public for its own portfolio monetizing the debt. Bank Money deposits crediting the borrower’s account with a new deposit a bank issues a loan paid off 10% vault cash deposit at the Fed