Wikipedia:Reference desk/Archives/Humanities/2013 December 14

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December 14

Who initially owns newly printed US money?

When new US money is printed, who is the initial owner of it? — Preceding unsigned comment added by 108.36.90.213 (talk) 07:58, 14 December 2013 (UTC)

The initial owner of the actual pieces of paper is the Bureau of Engraving and Printing. These are then transported to the various branches of the Federal Reserve Bank from where they're issued to the public. Tevildo (talk) 09:39, 14 December 2013 (UTC)

Just to add to Tevildo's accurate response above, money that is newly printed normally just replaces old notes that are withdrawn from circulation and destroyed, plus a small amount to replace notes that have been accidentally destroyed or are being retained and are not likely to go back into circulation (note collections, one-time foreign travellers etc). Where the amount of "new money" exceeds this, the OP might be interested in our article Quantitative easing#Printing money. Dbfirs 12:14, 14 December 2013 (UTC)

(After EC) The question is not about who owns the money as pieces of paper, but money as tokens with value. Say if a $100 bill is printed, who initially owns the $100 value and gets to spend it? When an ordinary bank lends out money deposited by its depositors, the money is still that of the depositors' in the sense that the banks owes them the amount. In the case of the Federal Reserve Bank, who, if any, is the equivalent of the depositors? --108.36.90.213 (talk) 12:25, 14 December 2013 (UTC)

Would the equivalent of the "depositor" be the Treasury Dept.? Blueboar (talk) 13:56, 14 December 2013 (UTC)

Yes. Federal Reserve System is our main article on how money works in the USA. See, in particular, Federal Reserve System#Central bank. Tevildo (talk) 14:09, 14 December 2013 (UTC)

That doesn't seem right. Wouldn't that mean the US government can increase its "net worth", at everybody else's expense (by diluting the value of the dollar), just by printing more money? --108.36.90.213 (talk) 15:43, 14 December 2013 (UTC)

Indeed it does mean that - see fiat currency, money creation and Nixon Shock. Whether it's "right" or not is a political question that has no correct answer. ;) Tevildo (talk) 15:48, 14 December 2013 (UTC)

Various foreign governments have done exactly that, and later discovered that all they really succeeded in doing was pouring millions of gallons/litres of petrol/gasoline onto the rampaging wildfire of inflation. -- Jack of Oz ^{[pleasantries]} 18:56, 14 December 2013 (UTC)

If you give me an old 100 bill and I give you a new one and then destroy the old one, then nothing has been spent (other than the cost of printing it). ←Baseball Bugs ^{What's up, Doc?} carrots→ 14:26, 14 December 2013 (UTC)

I'm not talking about replacing old, worn-out bills; I'm talking about creating new money that didn't exist before. --108.36.90.213 (talk) 15:43, 14 December 2013 (UTC)

In addition to the points above, I'm not totally sure you understand fractional reserve banking or the money multiplier either. I'm not an economist but I think this simplified explaination isn't that inaccurate. The money that is lent out isn't really the money that is deposited. It's effectively new money. In the case of a demand deposit, the depositor can at any stage take their money back. The bank can't tell them 'oops sorry I lent it out'. The amount of money that is in the system is therefore actually increased since there's the money that is lent out and the demand deposits that can be due at any time. This sorta works most of the time, the problem is when there's a bank run and there isn't actually enough reserves to pay back all those trying to withdraw their deposit. (But a bank run also illustrates the point about there being more money in the system than actually exists i.e. the money owned to the people wanting to withdraw their deposits and the money that was lent out. The people withdrawing their money want their money back from the bank who legally owe them. The people who borrowed the money have that money, perhaps spent including paid to the people who deposited their money and now want it back. And the borrowers only have to pay back their loans in accordance with the terms they agreed to which doesn't include paying it back right now because the depositors want their money back.) Edit: Notice Aspro said something similar below. Nil Einne (talk) 01:39, 15 December 2013 (UTC)

What I think the OP is referring to is: if a bank has a hundred million on deposit, it can request five times that amount in Dollar Bills from the reserve, on the assumption that their depositors will not all demand their many back at one. It is the old banking adage... Borrow long, lend short. In other words, long term investors provide the collateral that the bank can lend short term, in the hope that they will be able to make enough profit to pay off the initial investors and all the dollars they created out of thin air. This is why the US came off of the Gold Standard. It allowed the creation of money. So the US dollar to day is worth a fraction of its original value, when compared to its value under the original Dollar gold price.--Aspro (talk) 20:40, 14 December 2013 (UTC)

Travel Accounts to Tahiti or Society Islands in the 1880s or 1890s

Are there any travel accounts/public domain books written about travels to Tahiti or the Society Islands in the 1880s or 1890s? I need a primary source to relate to the events of the "Leewards War," a period of native resistance to French annexation in the Leeward Islands of the Society Islands. --KAVEBEAR (talk) 14:22, 14 December 2013 (UTC)

Noa Noa by Paul Gauguin chronicles his experiences on Tahiti in the early 1890s. I have no idea whether he mentions anything about those events though. --Saddhiyama (talk) 15:02, 14 December 2013 (UTC)

Tahiti, the Garden of the Pacific, etc. (1891) - 30mb PDF. Haven't checked the text, but it may be of use. Andrew Gray (talk) 18:28, 14 December 2013 (UTC)