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The Indian money market consists of diverse sub-markets, each dealing in a particular type of short-term credit. The money market fulfills the borrowing and investment requirements of providers and users of short-term funds, and balances the demand for and supply of short-term funds by providing an equilibrium mechanism.
With no capital control, market players will do this en masse. The trade will involve selling the borrowed currency on the foreign exchange market in order to acquire foreign currency to invest abroad – and this tends to cause the price of the nation's currency to drop due to the sudden extra supply.
The money market is a component of the economy that provides short-term funds. The money market deals in short-term loans, generally for a period of a year or less. As short-term securities became a commodity, the money market became a component of the financial market for assets involved in short-term borrowing, lending, buying and selling with original maturities of one year or less.
Creating money activates idle resources, mainly labor. Not doing so is immoral. Demand can be insensitive to interest rate changes, so a key mainstream assumption, that lower interest rates lead to higher demand, is questionable. There is a "free lunch" in creating money to fund government expenditure to achieve full employment.
The debate concerned the nature and role of capital goods and a critique of the neoclassical vision of aggregate production and distribution. The question of whether the natural growth rate is exogenous, or endogenous to demand (and whether it is input growth that causes output growth, or vice versa), lies at the heart of the debate.
Alternatives to a money market account. A money market account is a secure, low-risk way to plan for a family holiday, save toward retirement or build an emergency fund, but it isn’t the only ...
Economic collapse – Severe and prolonged economic problems; Exorbitant privilege – Economic gain by reserve currency nation; Financial crisis – Situation in which financial assets suddenly lose a large part of their nominal value; Financial market – Generic term for all markets in which trading takes place with capital
The Triffin dilemma is usually cited to articulate the problems with the role of the U.S. dollar as the reserve currency under the worldwide Bretton Woods system established in 1944. John Maynard Keynes had anticipated this difficulty and had advocated the use of a global reserve currency called 'Bancor'.