Sunday, May 28, 2023

Mortgage Calculator

Understanding Mortgage Calculator: A Powerful Tool for Homebuyers

To calculate your mortgage payments, you'll need to know the following information: Loan amount: The total amount you're borrowing from the lender.
Interest rate: The annual interest rate on the loan.
Loan term: The number of years you'll take to repay the loan.
Payment frequency: How often you make mortgage payments (monthly, biweekly, etc.).
Once you provide me with this information, You can calculate your monthly mortgage payment.

Introduction:
 When it comes to purchasing a home, understanding the financial implications is crucial. A mortgage calculator is a powerful tool that can help prospective homebuyers gain clarity and make informed decisions. In this article, we will explore the significance of a mortgage calculator, how it works, and how it can assist in financial planning.

What is a Mortgage Calculator? 

A mortgage calculator is an online tool designed to estimate mortgage payments based on specific input parameters. It allows users to determine their monthly mortgage payments, total interest paid over the loan term, and the impact of different variables such as loan amount, interest rate, and loan term.

Friday, March 3, 2023

Your Money: Check out use based engine protection approaches

Check out using based engine protection approaches

Check out use based engine protection approaches
Check out using based engine protection approaches 

Representatives all through the nation are being urged to telecommute, the greater part of the shopping is going on the web, and numerous different things the manner in which we used to do before are evolving as well.

Since most organizations have embraced telecommute strategy because of the continuous Covid-19 pandemic, there has been an extreme across the country decrease in the number of kilometers we drive. From mid-March through June first week, the absolute number of kilometers driven is somewhere around practically half countrywide, as indicated by late media reports. These are some really bizarre occasions as unprecedented changes have gotten normal in practically all parts of our lives.

Representatives all through the nation are being urged to telecommute, the majority of the shopping is going on the web, and numerous different things the manner in which we used to do before are evolving as well.

Since most organizations have received work-from-home arrangements because of the continuous Covid-19 pandemic, there has been an intense across the country decrease in the number of kilometers we drive. From mid-March through June first week, the all-out number of kilometers driven is somewhere around practically half countrywide, as indicated by late media reports. These are some genuinely unusual occasions as exceptional changes have gotten normal in basically all parts of our lives.

Representatives all through the nation are being urged to telecommute, a large portion of the shopping is occurring on the web, and numerous different things the manner in which we used to do before are evolving as well. With development occurring all over, for what reason should protection be forgotten about?


On that note, we currently at long last have use-based engine protection strategies in India. The new sort of vehicle protection arrangements, propelled by various guarantors, permits vehicle proprietors to safeguard their vehicles for kilometers they will in general drive rather than the common entire year. For every one of those searching for a vehicle protection strategy that is estimated depending on the amount you really drive, pay-as-you-use protection might be the appropriate response.

Representatives all through the nation are being urged to telecommute, the vast majority of the shopping is occurring on the web, and numerous different things the manner in which we used to do before are evolving as well. With advancement occurring all over the place, for what reason should protection be forgotten about?

On that note, we currently at long last have utilization-based engine protection approaches in India. The new sort of vehicle protection arrangements, propelled by various safety net providers, permits vehicle proprietors to guarantee their vehicles for kilometers they will in general drive rather than the ordinary entire year. For each one of those searching for a vehicle protection strategy that is evaluated dependent on the amount you really drive, pay-as-you-use protection might be the appropriate response

In the course of recent weeks, a bunch of insurance agencies has begun offering pay-as-you-drive protection. For drivers who aren't continually out and about, these plans could offer a chance to decrease vehicle protection costs.


Edelweiss SWITCH


Edelweiss General Insurance's Edelweiss SWITCH is a driver-based engine protection strategy that not just permits vehicle proprietors to switch their engine protection 'on' and 'off' in light of use, yet in addition covers various vehicles under a solitary arrangement as it is a floater strategy. Not at all like a conventional engine's own harm strategy, protection premium for SWITCH will be determined based on the age and experience of the driver.

Bharti AXA Pay-as-you-drive

Bharti AXA General Insurance will presently offer utilization-based engine protection arrangements for private vehicle proprietors under IRDAI s Sandbox venture. The Pay-as-you-drive protection item will be a blend of both thorough own harm (OD) and outsider (TP) strategy wherein the TP premium will be chosen according to the IRDAI standards while the far-reaching OD premium will be determined premise what number of kilometers you mean to drive your vehicle in a given timespan. Right now, the guarantor has thought of three pieces—2,500 km, 5,000 km, and 7,500 km under the Pay-as-you drive engine protection strategy.

With the presentation of Pay-as-you-use, engine protection will advance to turn out to be significantly more receptive to the necessities of the clients. The move bodes well in unsure occasions when pointless excursions are disheartened by the legislature and associations and representatives the same are finding the advantages of telecommuting.

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Somebody who doesn't drive much may set aside cash by changing to Pay-as-you-use vehicle protection.

In any case, while thinking about the amount you drive, don't erroneously factor in the timeframe your drive takes, particularly in the event that you invest energy sitting in clogged rush hour gridlock. It isn't about to what extent you spend in your vehicle. It is the separation you are driving. The 'Pay-as-you-drive' model will without a doubt improve protection entrance in the general part by bringing an ever-increasing number of vehicles under the protection umbrella.

Representatives all through the nation are being urged to telecommute, the greater part of the shopping is going on the web, and numerous different things the manner in which we used to do before are evolving as well. Representatives all through the nation are being urged to telecommute, the majority of the shopping is going on the web, and numerous different things the manner in which we used to do before are evolving as well. Representatives all through the nation are being urged to telecommute, a large portion of the shopping is occurring on the web, and numerous different things the manner in which we used to do before are evolving as well. The new sort of vehicle protection arrangements, propelled by various guarantors, permits vehicle proprietors to safeguard their vehicles for kilometers they will in general drive rather than the common entire year. For every one of those searching for a vehicle protection strategy that is estimated depending on the amount you really drive, pay-as-you-use protection might be the appropriate response. Representatives all through the nation are being urged to telecommute, the vast majority of the shopping is occurring on the web, and numerous different things the manner in which we used to do before are evolving as well. For each one of those searching for a vehicle protection strategy that is evaluated dependent on the amount you really drive, pay-as-you-use protection might be the appropriate response In the course of recent weeks, a bunch of insurance agencies has begun offering pay-as-you-drive protection. The Pay-as-you-drive protection item will be a blend of both thorough own harm and outsider strategy wherein the TP premium will be chosen according to the IRDAI standards while the far-reaching OD premium will be determined premise what number of kilometers you mean to drive your vehicle in a given timespan. With the presentation of Pay-as-you-use, engine protection will advance to turn out to be significantly more receptive to the necessities of the clients. The 'Pay-as-you-drive' model will without a doubt improve protection entrance in the general part by bringing an ever-increasing number of vehicles under the protection umbrella.
The new sort of vehicle protection arrangements, propelled by various guarantors, permits vehicle proprietors to safeguard their vehicles for kilometers they will in general drive rather than the common entire year. For every one of those searching for a vehicle protection strategy that is estimated depending on the amount you really drive, pay-as-you-use protection might be the appropriate response. For each one of those searching for a vehicle protection strategy that is evaluated dependent on the amount you really drive, pay-as-you-use protection might be the appropriate response In the course of recent weeks, a bunch of insurance agencies has begun offering pay-as-you-drive protection.


LIC Pension Scheme: you can get pension with better returns.

 LIC Pension Scheme: In this scheme of LIC, you can get a pension with investment even at the age of 80, you get better returns.


LIC Jeevan Shanti yojana: 

If you are a job, small business, farmer, or unorganized sector worker, but plan to live life better after the age of retirement, then for such people in LIC A better plan is LIC Jeevan Shanti Plan. This plan gives better returns as well as income tax exemption. Come, know what is the benefit of this plan and how it can be achieved.
What is the plan?


LIC Jeevan Shanti Yojana

 Is a single premium plan with a dual option of return. Both these options can be immediate or future pension. This is a kind of pension scheme, from which many types of benefits can be availed. It is a completely non-linked and non-participating plan. With the help of this scheme, people can get benefits in many ways.

What are the two scheme options?


In this scheme, investors are given two options to get a pension or benefits. It has immediate and deferred plans. There are many options to choose from in both these schemes. Out of the nine immediate annual options, there are two plans in which there is also the option of life insurance. There are two options for purchasing a future pension plan. Both cover life risks. Return can be availed immediately in the immediate annuity plan, while in the deferred annuity plan, the time can be selected when you want to get the return.

These are the options of the Tatkal Pension Scheme


Option A: This is an immediate pension plan. In this, the policyholder gets immediate returns and can get lifetime returns. In this, returns can be found monthly, quarterly, yearly, or two years. The pension stops after the death of the policyholder.

Option B: According to this option of the plan, there is a guaranteed payment for a term of five years. Since it is an instant pension scheme, the payment starts immediately. If the policyholder dies during the prescribed five years, his family members get the guaranteed amount.

Option C: In this option of the plan the policyholder gets a guaranteed return for a period of 10 years. If there is an accident with the policyholder during this period, then their families get the pension amount.

Option D: This option is an immediate pension option with a guaranteed term of 15 years. Even after this period, if the policyholder remains alive, he still remains entitled to a pension throughout his life.


Option E: In this option, the policyholder gets a pension for a period of 20 years. During this time, if the policyholder dies, his nominee will continue to receive the pension amount for a fixed period.

Option F: This option is one of the immediate pension schemes and in this, the policyholder can get the benefit of his family after death. In such a situation, the nominee will also get the applicable return along with the sum assured.

Option G: In this option of the scheme, pension increases by 3% every year.

Option H: This is a joint pension scheme and at the time of the death of the policyholder, the other person gets 50 percent of the pension amount till he survives.

Option I: This is also a joint pension scheme. Under this option, if something happens to one policyholder, then the other person gets 100 percent benefit from this scheme.

Option J: This option is also a joint pension scheme and in the event of something happening to one policyholder, the other can get 100 percent benefit of the scheme on an annual basis. The policyholder gets cover even at the time of his death. The amount that he is entitled to receive is given as a return along with the sum assured.

Managerial Economics, 8ed, (An Indian Adaptation): Analysis, Problems, Cases Paperback – 1 


Deferred pension options


There are two options of the deferred pension scheme, in which benefits can be obtained after a certain period. Its first option involves the life of only one person. In this, the beneficiary gets a death benefit at the time of death of the policyholder before the stipulated period. In the other option, pension is calculated on the basis of annual return. In case of death of the policyholder, the beneficiary gets death benefit, but the pension is stopped immediately.

Who can buy the plan


Under this scheme, any citizen of India can buy the plan of LIC Jeevan Shanti Yojana. Under this scheme, a man of 30 years to 79 years can also buy a plan. However, for option F of this plan, a 100-year-old man can also buy its plan.

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What is the investment amount?


The minimum amount of investment under LIC Jeevan Shanti Yojana has been fixed at Rs 1.5 lakh and there is no upper limit for this. Premium amount can also be deposited in this lump sum.

These are the options of the Tatkal Pension Scheme Option A: This is an immediate pension plan. Option B: According to this option of the plan, there is a guaranteed payment for a term of five years. Option C: In this option of the plan the policyholder gets a guaranteed return for a period of 10 years. Option E: In this option, the policyholder gets a pension for a period of 20 years. Option F: This option is one of the immediate pension schemes and in this, the policyholder can get the benefit of his family after death. Option H: This is a joint pension scheme and at the time of the death of the policyholder, the other person gets 50 percent of the pension amount till he survives. Option J: This option is also a joint pension scheme and in the event of something happening to one policyholder, the other can get 100 percent benefit of the scheme on an annual basis. Deferred pension options There are two options of the deferred pension scheme, in which benefits can be obtained after a certain period. In this, the beneficiary gets a death benefit at the time of death of the policyholder before the stipulated period. In the other option, pension is calculated on the basis of annual return.
Option F: This option is one of the immediate pension schemes and in this, the policyholder can get the benefit of his family after death. Option J: This option is also a joint pension scheme and in the event of something happening to one policyholder, the other can get 100 percent benefit of the scheme on an annual basis. Deferred pension options There are two options of the deferred pension scheme, in which benefits can be obtained after a certain period.

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FAQ--

What is LIC Annual Pension Plan?

An annuity plan, as the name suggests, provides you with a regular income throughout your life after making a lump sum investment. What happens with an annuity plan is that your life insurance company invests your money and returns what it pays when you retire.

How can I get 50000 pension per month?

So, to get Rs 50,000 per month or around Rs 6 lakh annually, you need to invest around Rs 80 lakh. Senior Citizen Savings Scheme (SCSS) is a safer option with an annual interest rate of 7.4 per cent, but you can invest only up to Rs 15 lakh in each scheme.

LIC Pension Tax Free?

Any amount received through conversion of pension between Jeevan Suraksha and Jeevan Nidhi annuity plans is tax free.
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Wednesday, March 1, 2023

Have you examined the credit rating?

Fixed deposit, have you examined the credit rating?

The interest rate of fixed deposits has increased in the investment market. There are very few self-interested investors in our country. We are sure that a large section of savings banks will believe in term deposits. Oh man, oh man, and many others undoubtedly want to invest in deposits. Naturally, the average (or conservative) investor seeks higher interest rates. Due to the rush of banks, NBFCs, and corporate deposit schemes, investor enthusiasm is visible everywhere. Banking regulator Reserve Bank of India's change in repo rate will lead to a huge increase in interest rates. This change has been made in view of rising inflation.

It's a one-sided thing. Now read my words carefully. think about it. Today I highlight two things for you. One, the inflation you mentioned is one of the enemies of fixed depositors. Second, the interest earned on the deposit is taxed on you.

Let me clarify let's take the second issue first. Your overall income will be increased by the interest gained. Thus, remember to include interest income when calculating your earnings at the end of the year. The question now is how much is left in your hand after paying taxes? If you are happy to pay taxes, there is nothing to say. But remember this at all I remember this every time.

Now we come to the first topic. It goes without saying that inflation is a very destructive investment. So it is your responsibility to understand what "inflation-adjusted return" actually is. Generally, as a depositor, one should look for a realistic result after accounting for taxes and inflation. I would say that when the general public of our country invests in deposits, they should be aware of the soundness of the project (and the predictability of the promised returns). Read the ratings carefully, otherwise, you might be tempted by good prices. This situation is not desirable. If you get a reliable promoter (especially for corporate projects), you can move on.

So to get an idea about the deposit scheme at a glance, here are a few things you should look out for:

#Credit rating Dihal Gayle or

# Credibility of the promoter of the institution

# What is the interest rate?

# Impact of inflation and income tax


Before I conclude with words, let me highlight another important point. Check how much-fixed deposits make up your total benefits. If you feel that you are overinvested in deposits in the current scenario, and can spend more time in other types of assets depending on your risk profile, consider rebalancing. Maybe it will be fine in the end

Thursday, February 23, 2023

LIC Jeevan Labh Policy: become a millionaire

LIC Jeevan Labh Policy: By investing Rs 17 per day you will become a millionaire

LIC Jeevan Labh Policy: become a millionaire
 LIC Jeevan Labh Policy: become a millionaire

LIC Jeevan Labh Policy comes under Non-Linked Plan

Simple Reversionary Bonus and Final Edition Bonus are available in the plan

There are many ways at present to secure yourself financially for the future. As a current venture and investment people are going towards SIP investment and mutual funds. Both of them depend on the mood of the market. On the off chance that the market is progressing nicely, then there will be profit or loss. If you want to invest and you want that you do not suffer loss and get both profit and protection, then you should go towards such a policy of LIC which is not linked to the stock market i.e. LIC's Non-Linked Plan (LIC Non-Linked Plan). Today we will enlighten you regarding a particularly non-connected arrangement,  which can make you a millionaire soon with an investment of Rs 17 per day. The name of this policy is LIC Jeevan Labh Policy.

 ALSO READSEVEN BEST INVESTMENT OPTIONS

Here are some of the special features of

The policy - Only people between the age group of 8 to 59 years can take this policy.

The development age of this strategy is 75 years.  The strategy term can be taken from 16 to 25 years. At least two lakh rupees have to be taken sum assured. There is no boundary of the highest point.

Compensation for accidental death and disability has been included in this policy.

15 Practuce Sets Bhartiya Jeevan Bima Nigam (LIC) Prashikshu Vikas Adhikari (ADO) Bharti Pariksha 2015 

On the off chance that you spend a premium of Rs 1,55,328 for 25 years i.e. Rs 518 i.e. Rs 17 per month, then on

The maturity you will get is about Rs 4.04 lakh with a bonus.

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Know about the benefits of the policy

- There is also limited premium payment which means the premium paying term is less than the policy term or maturity period.

- At the same time security and assured returns facilities are also available.

Loan facility available after paying a premium for three years.

Add-on riders facility in the form of Accidental Death and Disability Benefit Rider.

Expense exception under segment 80C of Income Tax on premium. 

Expense exception on development sum under segment 10(10D) of Income Tax. 

ALSO VIEWLIC Pension Scheme: you can get a pension with better returns.

This is how the payout is

If the policyholder dies and he has paid all the premiums without any interruption till the death, then the nominee is paid in full by adding the Sum Assured, Reversionary Bonus, and Final Addition Bonus. The special thing is that the death benefit received here should not be less than 105 percent of the total premium paid till the death of the policyholder. Where the policyholder survives the entire term and has paid all the premiums till maturity, he/she is paid the Sum Assured along with the  Reversionary Bonus, and Final Addition Bonus.

LIC Jeevan Labh Policy comes under Non-Linked Plan Simple Reversionary Bonus and Final Edition Bonus are available in the plan There are many ways at present to secure yourself financially for the future. Both of them depend on the mood of the market. On the off chance that the market is progressing nicely, then there will be profit or loss. If you want to invest and you want that you do not suffer loss and get both profit and protection, then you should go towards such a policy of LIC which is not linked to the stock market i.e. The name of this policy is LIC Jeevan Labh Policy. Here are some of the special features of The policy - Only people between the age group of 8 to 59 years can take this policy. The development age of this strategy is 75 years. On the off chance that you spend a premium of Rs 1,55,328 for 25 years i.e. Know about the benefits of the policy - There is also limited premium payment which means the premium paying term is less than the policy term or maturity period.- At the same time security and assured returns facilities are also available. Add-on riders facility in the form of Accidental Death and Disability Benefit Rider.

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The name of this policy is LIC Jeevan Labh Policy.LIC LIC Jeevan Labh Policy comes under Non-Linked Plan Simple Reversionary Bonus and Final Edition Bonus are available in the plan There are many ways at present to secure yourself financially for the future. On the off chance that the market is progressing nicely, then there will be profit or loss. On the off chance that you spend a premium of Rs 1,55,328 for 25 years i.e. Here are some of the special features of The policy - Only people between the age group of 8 to 59 years can take this policy. Add-on riders facility in the form of Accidental Death and Disability Benefit Rider. Both of them depend on the mood of the market.

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FAQ

Is it worth investing in LIC Life Profit?

If you choose to invest in this policy, you can be rest assured that in the event of your unfortunate demise, your family's future is secured and their needs are taken care of. Moreover, LIC's Jeevan Benefits offer significant flexibility in terms of policy term, premium paying term, age etc.

How much money will I get from Life Benefit Policy?

Using the LIC Life Benefit Calculator, the annual premium comes to Rs 54,707. Higher of (7 x 54,707 = Rs. 3.82 lakh) or BSA (Rs. 10 lakh), which means the nominee will get the latter. For 10 years, the bonus will be Rs (44 x 10,00,000/1,000) x 10 = Rs. 4.4 lakhs.

How To Make Your Product Stand Out With WHAT IS THE RETURN PERCENTAGE OF LIC JEEVAN LABH?

10 times the annualized premium or maximum Sum Assured on death of the Basic Life Assured. The death benefit shall not be less than 105% of the total premium amount paid as on the date of death.

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Sunday, January 22, 2023

How To Deal With(A) Very Bad STOCK MARKET BASICS

How I Improved My STOCK MARKET BASICS

Financial markets provide its participants with the most favorable conditions for buying/selling financials. They have tools inside. Its main functions are: Guaranteed liquidity, built into asset prices. Establishment and reduction of supply and demand. Operating expenses by its market participants. There are different types of instruments in the financial market, so it is. The effectiveness depends entirely on the organized equipment. Usually it is. Can be classified according to financial type. Tools and equipment were paid for as per the terms. wear a variety of equipment

The market can be divided into promissory notes and A security (stock market). The first one is included. Promissory note with the rights of the holders. fixed amount in future and obliging the latter is called the promissory note market. Paying a fixed amount as per the issuer. Returns received after payment of all promissory notes. And this is called stock market. There are also types. Both categories refer to securities, such as preference shares and convertible bonds. They are also called fixed return instruments.

Another classification is due to loan repayment terms. The machines are: the highly liquid asset market (money market) and the capital market. The first refers to the short-term commitment of the market focus with the asset. up to 12 months of age. The second refers to the market. Long term promissory note with instruments 1 2 months before due. This classification can be referred to for bonds. As a sole market its instruments have a fixed expiry date, however there is no stock market.

As mentioned earlier, purchasers of common shares. Usually the company-issuer and invests its own funds. Receiving. Their weight in the process of formation. The decision depends on the number of shares in the company. He has financial experience. Company, its market share and potential future share. Can be divided into several groups.

1. Blue Chips

Stocks of large companies with long records of profits. Growth, annual revenue over $4 billion, large capital. And dividend payments are called sustainability blue chips.

2. Growth Stock

The shares of such a company grow rapidly; Its manager usually. Follows the principle of revenue reinvestment. Development and modernization of the company. these/. Companies rarely pay dividends if they do. Dividends are minimal as compared to other companies.

3. Income Stock

Income shares are high and. including company stock. Stable income that pays high dividends to shareholders. Shares of such companies are usually used in mutual funds. Schemes for middle aged and elderly people.

4. Protective Stock

It is a stock whose price remains stable. Markets can and do perform well during recessions. to reduce risk. When the market moves, they do the right thing. There is demand during sour and economic booms. These categories are widely spread across mutual funds. Useful to better understand the investment process

Keeping this division in mind.

Shares can be issued both domestically and abroad. If a company wants to issue its shares abroad, it can use it. American Depository Receipts (ADRs). ADRs are usually issued. The rights of American banks and shareholders are indicated. Holding shares in a foreign company under assets. Management of a bank. Each addition represents one or more stock holdings. When dealing with stocks other than the buy/sell ratio. On the plus side, you can also get quarterly dividends. They depend on: type of shares, financial condition of the company, division etc. Common shares do not guarantee the payment of dividends. A company's dividend depends on its profits and surplus cash. Dividends differ from each other as they should. With the possibility of payment in different periods. more below. When the time comes, companies don't pay dividends at all, mostly when a company has financial problems or executives make a decision. Reinvest income in business growth. Dividend is an important factor when calculating the authorized share price.

The price of a common share is determined by three main factors:

Annual dividend rate, dividend growth rate and discount. The latter rate is also called the required rate of return. A company with a high risk level is expected to be high. required rate of return. High cash flow high stock. This interdependence defines property versus value. Below we will talk about the breakdown of share prices. Estimate the dividend in three possible cases.

When buying shares other than risk and dividend. It is absolutely necessary to analyze, investigate the company. Calculate its profit/loss, balance, cash flow, distribution of profit among shareholders, salary of managers and officers etc. carefully when you are sure. You can easily buy or sell shares in all aspects of trading. if you don't know

Tuesday, January 3, 2023

HOW TO MAKE MORE MEANING REPRESENTED ABSTRACTLY: AN INTRODUCTION TO METAMONY

HOW TO MAKE MORE MEANING REPRESENTED ABSTRACTLY: AN INTRODUCTION TO METAMONY

Joe has an old leather wallet in his pocket. It has enough notes to buy a new wallet of a better model than the one I saw in a magazine. This purchasing power is specific to him, who alone can use those bills to buy something. Similarly, if he transfers them to someone else, only this other person will own their purchasing power instead.

However, although the person transferring his banknote can always transfer what is under their control, it may not be transferred with their entire property, which is not just his. The bill, as much as it is without their purchasing power, is not theirs alone. For example, they have no right to create or destroy: they are public. Either he or he who controls such notes has purchasing power, hence private ownership.

Indeed, having always only personally owned his banknotes, he could sell them independently of his purchasing power, which he could not represent. However, selling them this way will at least temporarily prevent them from using the same bill to buy anything. Then, recognizing their lost purchasing power as a monetary value for which they must represent it, one can conclude:

All financial values must be personal.

All representations of this must be public or non-public.

Yet, if not, who else can sell, buy, create or destroy its equivalent bank notes? This question should be insignificant if he has the bills instead of their monetary value. However, since the purchasing power of each bill may change when people sell, buy, create or destroy such bills, the same question becomes important. In fact, part of the answer is that commercial banks now sell most of what they create in the money supply, a process called fractional-reserve banking.

Commercial Commission

According to the Federal Reserve Bank of Chicago, [1] fractional-reserve banking originated from:

Then, bankers found that they could make loans to borrowers promising to pay them, or with bank notes. This is how banks start making money.

Bankers were also required, but - and still required - to have sufficient money to meet expected withdrawals, at any given time: "sufficient metallic money to be kept on hand, regardless of the amount of the ticket" paid to redeem it.

Hence the name "fractional-reserve banking": commercial banks must hold as a reserve a fraction of the deposited money - which legally (since 1971) is no longer "metallic money" but simply a public loan - to meet withdrawal requirements. "Under current regulations, the requirement for most business accounts is 10%."

In the fractional-reserve banking system on which much of today's international economy depends, commercial banks make money by lending it, so in the form of a personal loan.

Transaction deposits are the modern equivalent of bank notes. It was a short step from printing notes to creating book entries that accumulated borrowers' deposits, which borrowers could "spend" by writing checks, thereby "printing" their own money.

For example, when a commercial bank accepts a new deposit of $10,000.00, 10% of this new deposit becomes the bank's reserve to lend up to $9,000.00 (90% with savings) to the account, without taking back the money borrowed from the source, at interest. Similarly, if that maximum $9,000.00 loan occurs and the borrower deposits it into another account, either at the same bank or not, 10% of that is reserved for loans up to $8,100.00 at the next bank (now 90% in excess stock). As usual, even if the money is not withdrawn from the source account, the bank charges interest on the loan. This process can continue indefinitely, adding $90,000.00 to the money supply, valued only as loans received from their borrowers: after countless repeated loans of 90% fractions from the $10,000.00 original deposit, that same deposit will eventually return to itself. 10% becomes the reserve totaling $100,000.00. [2]

Thus in each phase of expansion, "money" can increase by a total of 10 times the amount of new reserves supplied to the banking system, as new deposits created by credit in each phase exceed and add to those created in all previous phases. For deposits provided. Creates an initial reserve.

Yet how can credit alone create new money? How can a loan reverse its outstanding balance? Something else has to happen here besides just debt. What else is going on in the entire commercial banking system? First, there is a deposit. Then, up to a fraction (90%) of this deposit is loaned on interest, which the bank never recovers from the source account. Finally, the borrower can transfer the loan to another account in the same or another bank. Suddenly, trillion-dollar

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