When someone makes an electronic transaction, does that transaction result in the movement of physical money from one place to another?

Question

With so many transactions being electronic these days (I never carry more than $40 and might have the same $40 all month) how much are all these electronic transactions resulting in the actual physical movement of bills and coins from A to B? If I pay someone $100 who banks with a different bank is my bank actually sending their bank a $100 bill or is a lot of this just happening in a computer network without actual physical assets moving around?

In: Economics

Answer 1

Try looking Vsauce’s video “How Much Money Is There On Earth” up. At some point in the video, electronic transactions are explained in detail 🙂