Subject The article describes the existing and new laws of money circulation and shows negative consequences of their violation. Objectives The purpose of the paper is to analyze and demonstrate the effect of the three laws of money circulation, i.e. applicability, control over circulation, and monetization, as historically emerged laws that continue their effect through time. Methods To provide a rationale for money circulation laws, I apply historical and abstract-logical methods. Testing the effect of the laws in practice draws on the systems approach. These methods and approach enabled to disclose and explain the variety of transformations of money circulation. Results The obtained results are significant as far as theory is concerned: the study justified two new laws of monetary circulation and refined the mechanism of action and practical application of the law of money supply. This will enable to create the necessary scientific foundation for further theoretical and practical work in this area of economics. Conclusions Disregarding the laws of monetary circulation leads to crises and shocks, and compliance with the laws allows pursuing an efficient monetary policy and building a completely different architecture of the monetary and banking system. The latter rests on centralization of all accounting and settlement operations exclusively within the treasury system, and specialization of private banks by bank savings and lending functions.
Keywords: monetary circulation, Treasury, essence of money, laws of economics
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