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The main correlations between the monetary-banking indicators

Mădălina-Gabriela Anghel, Constantin Anghelache and Ana Carp ()
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Mădălina-Gabriela Anghel: „Artifex” University of Bucharest, Romania
Constantin Anghelache: The Bucharest University of Economic Studies, Romania „Artifex” University of Bucharest, Romania

Theoretical and Applied Economics, 2017, vol. XXIV, issue 2(611), Summer, 99-110

Abstract: At the level of national economy, the essential problem is that of the use of financial resources. Of course, every society has its own resources, but that they are not always sufficient. To operate in a free market economy appears very often need to turn to the Bank's resources in the form of loans. Credit implies the existence of credit resources on the part of the banking system but, at the same time, it raises the question of the relationship between monetary mass in circulation and monetary mass necessary to ensure market equilibrium required. The banking system is defined and represented in the two sub-sectors, namely: monetary authorities that it is a country's National Bank and the system of commercial banks. Great economists have noted that the imbalance between the monetary mass necessary and the monetary mass in circulation may be, at some point, a problematic leading to financial crisis and broader financial and economic crisis. In this article we try to make an analysis based on data sources that stand available to any researcher. Thus, as a first idea, we discuss about the Central Bank's balance sheet, one that offers the possibility of calculating the balance of equilibrium equation which shows a series of correlations are established on the market. The second source of analysis and interpretation of this market is the aggregate balance sheet of commercial banks. Based on this balance sheet is calculated the balance sheet equation which can give an accurate picture on the ratio between the requirements and possibilities. Also, in the article we referred to the monetary situation, especially consolidated monetary situation, one who has existing monetary mass market in passive, and international reserves and net domestic assets, in assets which are and must be in balance, i.e. the two indicators of assets must equal monetary mass so that no imbalances. In the article, we refer to the main correlations between monetary aggregates to embrace the situation at a given time and to be able to conclude that evolution can be perspective in this area.

Keywords: monetary mass; correlation; balance sheet; the monetary aggregate; the monetary balance. (search for similar items in EconPapers)
Date: 2017
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