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Showing posts with the label money buffers

The banking reserve and financial policy

https://gamesandtehories.blogspot.com/ Kimmo Huosionmaa When governments make their contracts of the structure like roads and buildings they act like other actors. Almost every budget in the building industry is calculated a little bit over the real costs, because of the unexpected catastrophes or disturbing the production. There is calculated the loss of building material, what can be replaced with new elements, and if the accident happens in the building site, would that replacement pay the contractor.  But if there are no accidents, the money what is reserved for those replacements would leave to the bank accounts. Also, another reserve is made for repairings, but if there is no need for that the money would not be used. This would grow the money in the accounts, what are called the overbudgeting.  The governments are working like big companies in this area, and one of the things, where that money is used is the financial buffer, what makes possible t...