The central bank issues the base currency almost every day and recycles it. If you look at the vaults of people's banks around the world, you will know that there is a lot of cash in them, but only a small part of it is put into the market (counters and vaults of residents, enterprises and commercial banks). At present, there may be billions of cash in the treasury of the People's Bank of China, but only two or three trillion yuan have been put on the market. What is the main purpose of printing cash there? Mainly to prevent depositors from suddenly withdrawing a large amount of cash. There are 20 trillion residents' savings in China, but only 2 trillion banknotes are circulating in the hands of commercial banks and residents. What if residents suddenly withdraw all their deposits in case of emergency? Won't commercial banks let them withdraw them? No, residents can take as much as they want. Commercial banks only transfer cash to PBOC. After the incident subsided, residents deposited cash in the bank, and the bank deposited cash in PBOC. In addition to the normal withdrawal of cash by residents, other depositors increase the bank's deposit reserve balance in the central bank, and depositors also have interest income. However, when the loan scale of a commercial bank expands, so does its reserve in the central bank. At this time, it may be that the cash of commercial banks can't meet the withdrawal needs of depositors, and it can't be deposited in the central bank's deposit reserve according to the prescribed proportion at maturity, forcing commercial banks to reduce the loan scale. It is through these methods that the central bank regulates the economy and stabilizes the currency. But when all residents' income and expenses are transferred electronically, there is no need to use cash. It seems that the deposit reserve system is going to fail. I don't know if this is the case. The landlord may want to know how the original cash was put on the market. I think there are many channels. For example, first, it is mandatory that nothing except government-printed paper money, including gold and silver, can be used as a medium of exchange, but initially, residents can exchange paper money with gold and silver from the central bank, so that paper money will be put on the market. With the development of economy, commercial banks have created money through the derivative mechanism of deposits, but it is certainly not the base currency. The scale of deposits and loans has become larger, the transaction volume has increased, and the paper money needed has also increased. The original amount of paper money can't meet the demand of residents to withdraw cash. At this time, commercial banks can discount commercial bills to the central bank, so that paper money will be put back on the market. Then there is the central bank's purchase of bonds issued by enterprises, which is also to put the base currency into the market. Of course, the central bank can use the reverse operation to recover the base currency, use the statutory deposit reserve to recover the currency, and issue government bonds to recover the base currency. It should be noted that the government buys goods and pays the salaries of civil servants with tax money instead of printing money. It's strange that paper money doesn't flood.