You mean to hide the fact that its new money? No, because money is distributed by banks and banks get (buy) the money from the Federal Reserve. That's where the supply and demand thing comes in. The money that the government gets in taxes is all electronic (checks that go into bank accounts) and they can no more add a zero to the end of their bank statement than you can.chound said:
That's true, but the same catch still applies: your money is worth whatever the currency market says it is worth based on the trust the market has in your country's ability to keep its financial promises. Until this century, that trust was backed by gold: the government would exchange your dollar for a set amount of gold. Today, that's unnecessary for large countries, but small ones still need something of value to back their currency. Most use the US dollar. But this still only works up to a point. If people stop trusting you, they may want to trade in all their McCurdyDollars for American dollars. If you can't pay, your economy collapses.Tom McCurdy said:
Yes, economics is largely based on the psychology of the mob. Vaguely unsatisfying/disturbing, isn't it?Tom McCurdy said:
It depends on how you measure it (absolute or per capita, large vs fast growing), but the US is largest in absolute terms and Luxemburg is largest per capita. (DATA)Tom McCurdy said:
One of the prime reasons not to tie your currency to a commodity is that commodities can be very unstable. Oil's gyrations in the past week are a great example and the price of gold is another: as it turns out, when we were on the gold standard, it wasn't gold keeping the value of the dollar constant, it was the dollar keeping the price of gold constant.Moses said:
russ_watters said:
gravenewworld said:
Government printing money can have both positive and negative effects on the economy of poor countries. On one hand, it can stimulate economic growth by increasing the money supply and making it easier for businesses and individuals to access credit. This can lead to increased spending and investment, creating jobs and boosting economic activity. However, if the money supply increases too quickly, it can lead to inflation and decrease the value of the currency. This can make it more difficult for people to afford basic goods and services, further exacerbating poverty in the country.
Increasing salaries in poor countries can have both positive and negative consequences. On one hand, it can help to reduce poverty and improve the standard of living for individuals and families. This can also lead to increased consumer spending, which can stimulate economic growth. However, if salaries are increased too quickly or without proper planning, it can lead to inflation and higher costs for businesses. This can also lead to job losses and make it more difficult for businesses to compete in the global market.
In order for printing money and increasing salaries to truly benefit the poor in poor countries, the government must have a comprehensive plan in place. This may include implementing policies and programs to address inflation and ensure that the increased money supply is properly managed. Additionally, the government may need to invest in infrastructure and job creation initiatives to support the increased spending and economic growth.
Yes, there is a limit to how much money a government can print and how high salaries can be increased without causing negative consequences. This limit is often determined by the country's economic stability and the strength of its currency. If the government prints too much money or increases salaries too quickly, it can lead to inflation and devalue the currency, ultimately harming the economy and the poor in the country.
Yes, there are alternative solutions that can be explored to improve the economy and reduce poverty in poor countries. These may include implementing policies to promote economic growth, such as investing in education and infrastructure, and increasing access to financial services for individuals and small businesses. Additionally, governments could focus on creating more job opportunities and providing support for small businesses in order to stimulate economic activity and improve the standard of living for the poor.