tight money


Also found in: Dictionary, Thesaurus, Legal, Idioms.

Tight money

When a restricted money supply makes credit difficult to secure. The antithesis of tight money is easy money.

Tight Money

A situation in which it is difficult to receive credit because of the monetary policy of the central bank. Tight money occurs when the central bank has enacted relatively high target interest rates. While this usually happens when the central bank is seeking to control or is concerned about inflation, tight money can negatively impact security prices and make it hard to receive a loan for a house or business.

tight money

A condition of the money supply in which credit is restricted and interest rates, consequently, are relatively high. Tight money generally has a negative effect on security prices, at least in the short run. Compare easy money.

tight money

or

dear money

a government policy whereby the CENTRAL BANK is authorized to sell government BONDS on the open market to facilitate a decrease in t he MONEY SUPPLY (see MONETARY POLICY).

The decrease in money supply serves to increase INTEREST RATES, which discourages INVESTMENT because previously profitable investments become unprofitable owing to the increased cost of borrowing (see MARGINAL EFFICIENCY OF CAPITAL

INVESTMENT).

Tight money policy, through MONEY SUPPLY/SPENDING LINKAGES, reduces AGGREGATE DEMAND. Contrast CHEAP MONEY.

References in periodicals archive ?
Deflation has the benefit, if it's good deflation rather than the tight money variety, that it eventually feeds through into big productivity gains.
That's not surprising, given tight money and an unsure future for print journalism.
The simple question, in this day and age of tight money, is why should the majority of Council Tax payers have to cover costs incurred by single interest groups, whatever the event in question?
Likewise, crediting Volcker as the primary slayer of inflation overlooks both the Fed's inconsistent performance as well as Reagan's political courage in fending off immense pressure from both sides of the aisle to undercut Volcker's tight money policies.
While on the one side the Eurozone crisis and significantly lower foreign capital inflows impacted the country's growth prospects, the RBI's tight money policy curtailed credit flow into the economy which reflected in sharp decline in industrial production.
As I've already said, agriculture is better placed than most to secure necessary funding and that is a definite plus in the face of tight money supplies.
In that kind of tight money environment an RC department's go-ahead for capital purchases may be infrequent.
Bev Thomas and Marcia Shakespeare, the mums of Charlene and Letisha, said: "We are well aware of just how tight money is at the moment.
A stronger dollar, as we saw in the mid 1990s (Clinton) and early 1980s (Reagan) spawns deflation in the Gulf as the regional central banks are forced to track the Fed's tight money with higher dirham, dinar and riyal rates, even though local economic distress argues exactly the opposite.
Tight money gave rise to calls for "value," which, in the parlance of the automobile industry, translates to cost cutting, or what some marketers call "de-contenting.
Among the fundamental questions many Catholics are asking today, in a time of demographic shifts, tight money, downsizing and mergers, are: What's a parish supposed to be?