Xinhua Shanghai8 8 Xinhua domestic construction steel distribution platform, "West with the new Link" to the latest Early Warning Report, after an apparent "spikes" big, and prices soaring beyond the downstream users anxious to push the psychological expected, also weighed on demand for speculation in the middle of enthusiasm, the market has "priced non-City" signs. The estimated construction steel market supply and demand will be further exacerbated game, steel mills, "tall" began to lose momentum, the market correction pressures will become increasingly clear. overview of the latest news here: China military facelift digital camouflage some of the world's leading technology has been (temporarily missing figure) on the 29th listed company at night announcement ten institutions: two types of shares into the main counter-attack into a new richest man, Huang Guangyu Wang Chuanfu Pioneer only before entering the United States 20 China PVC implementation of the five-year anti-dumping Wang Shi: the amount of decline in value of the property market will continue to rise after the National Unicom 3G10 on Telephone Number 1, the basic package in the first 9 files only refer to the base 1 trillion leveraged funds will be unfrozen

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The demand for money is the desired holding of money balances in the form of cash or bank deposits.

Money is dominated as store of value by interest-bearing assets. However, money is necessary to carry out transactions, or in other words, it provides liquidity. This creates a trade-off between holding money versus holding other assets. The demand for money is a result of this trade-off regarding the form in which a person's wealth should be held. In macroeconomics motivations for holding one's wealth in the form of money can roughly be divided into the transaction motive and the asset motive. These can be further subdivided into more micro economically founded motivations for holding money.

Generally, demand for money increases with the level of nominal output (price level times real output) and decreases with the nominal interest rate. The demand for real balances is defined as the amount of money demanded divided by the price level. For a given money supply the locus of income-interest rate pairs at which money demand equals money supply determines the LM curve.

The magnitude of volatility of money demand has crucial implications for the optimal way in which a Central Bank should carry out monetary policy and its choice of a nominal anchor.

Conditions under which the LM curve is flat, so that increases in the money supply have no stimulatory effect (a liquidity trap), play an important role in Keynesian theory.



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