What is Money?

Money is...
What money does.
Medium of Exchange.  Store of Value.  Standard of Value.
Throughout history, a wide variety of items have served as money.
These include gold, silver, large stone wheels, tobacco, beer, dog teeth,
porpoise teeth, cattle, metal coins, paper bills, and checks.
All of these types of money should be judged on how well they accomplish
the functions of money.

Money is what money does.

To be a good medium of exchange, money must be accepted by people when buying and selling their productive resources and when buying and selling goods and services. It should be portable or easily carried from place to place. It also must be divisible so that large and small transactions can be made.

To be a good store of value, money must be durable so it can be kept for future use. It also should have a stable value so people do not lose purchasing power if they use the money at a later time.

To be a good standard of value or unit of account, money must be useful for quoting prices. To accomplish this, money must be familiar, divisible, and acceptable.

Money doesn't grow on trees... or does it?
How is money created?
The United States Treasury Bureau of Engraving and Printing prints billions of dollars each year for delivery to the Federal Reserve System. U.S. currency is used as a medium of exchange and store of value around the world.  According to the Federal Reserve, there is approximately $1.4 trillion worth of Federal Reserve notes in circulation.


Fun Facts About U.S. Currency:

  • During Fiscal Year 2015, the BEP delivered approximately 7 billion notes to the Federal Reserve.

  • More than 90 percent of the notes that the BEP delivers each year are used to replace notes already in, or taken out of circulation.

  • The average cost of a note is 10 cents.

  • Between the Fort Worth and Washington, DC facilities, approximately 8.7 tons of ink was used each day in FY 2015.

  • Recent estimates show that between one-half and two-thirds of the value of U.S. currency in circulation is held abroad.
Money makes the world go around.
How does money get into circulation?
The Federal Reserve System was created by Congress in 1913. The responsibilities of the Federal Reserve include:

  • influencing the supply of money and credit;
  • regulating and supervising financial institutions;
  • serving as a banking and fiscal agent for the United States government; and
  • supplying payments services to the public through depository institutions like banks, credit unions, and savings and loans. Payments services include issuing, transferring and redeeming U.S. government securities, processing and clearing checks, and transferring funds.

The Federal Reserve’s structure comprises the Board of Governors in Washington, D.C., and 12 regional Reserve Banks through-out the Nation.

Getting to know all about you.
U.S. currency in circulation.

The Federal Reserve Board currently issues $1, $2, $5, $10, $20, $50, and $100 notes.


CLICK the buttons below to learn about the  denominations that are in circulation today.

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