00:01
Here we're looking at some concepts of the money market, specifically here, the demand for money.
00:05
Let's go ahead and really define this real quick.
00:08
And demand for money is exactly what it sounds like.
00:10
It is essentially what consumers or individuals or firms, how much money we would like to hold.
00:17
So our demand for money is oftentimes relative to other assets.
00:21
So it might be relative to our demand for any sort of alternative assets.
00:26
I'm going to do that by aa.
00:27
Okay, this means our alternative assets.
00:31
So that means that we could choose to put our money into bonds or stocks or real estate, right? we could choose to dump that money into all of these other assets instead, but we may instead choose to hold onto our cash instead of doing that, which that is what defines our demand for money, is our relative willingness or want to hold on to it.
00:54
Now, the advantages of holding onto money, it could be made up of security, right? if i have a bunch of cash, i know that i have.
01:00
Have it.
01:01
I don't have to worry about losing it anywhere.
01:03
It's definitely going to lose its value over time as the price levels and inflation rates increase, but that might take a little while.
01:10
And if inflation rates, interest rates and all of that are pretty low, i should be pretty secure in holding onto my money...