how can america be broke?

Question

how can we be broke when we make our own money?

Answer 1

Every country is in debt. We are the richest country in the World.

Answer 2

We're not broke. In truth, the national debt is completely overshadowed, tiny in comparision, to the national debts of others toward us.

The difficulty is that if we demanded payment, many of them would default, and projects around the world, projects we support and help other countries on, would collapse. We would have NO deficit, and and extremely large surpluss.

Interesting that the same people who complain about the deficit are the people who go right on spending money around the world to give loans to countries that have proven their lack of ethics or financial responsibility.

There's also a lot more to it, almost all of which makes us look good when you really consider the facts, like comparing us to ALL the other nations, not just a select few.

Notice I didn't mention which party... . Can't.

I know the question was said in fun, but it makes a great forum to reeducate people on the basics of economics, instead of insulting you (be sure to report the ones who actually call you names).

Will someone take over and describe what our paper and coin money is based on?

Answer 3

I don't know who told you Ameica was broke, but I'm guessing you're a middle school or elementary school kid? If not, god...I don't know what to say to you. I will help you though. Econ 101: Every country prints its own money. Back in the good old days, paper money was all backed up by gold. So, a country could only have as much paper money as it did gold, becasue in our weird and twisted little world, the yellow metal that's really shiny has more value than food and water or even tin, which is actually really useful. So, after WWII, Europe was pretty beaten up, and in order to help it, the only economy that was still standing decided to make its money worth gold, and everyone else's worth dollars. During the Vietnam War and the simultaneous War on Poverty, the president decided that he would pay for all of this without raising taxes. So, he decided to print more dollars. Now, this reduces the value of the dollar, becasue there is more paper in the system, but a fixed amount of gold. So where say there was 35:1 ratio of dollars to ounces of gold, now the ratio was 40-something:1. Other countries, having their money's worth be decided by the dollar's worth were not happy because thier currency lost value as well. So, France decided to get out of this system by threatening to clean out Fort Knox by trading all thier dollars for gold. The US got worried and decided to get rid of this system and go for one of floating exchange rates where your currency is valued according to how your economy is doing. Now, this system has required, over the years, the US to print more money. Other countries have done that as well. Over time, the value of the pape money became so tied with the economy and how its doing that the gold value grew less and less important. So, technically today all our money is backed up by gold, but in reality we don't have enough gold to back up our currency. No country does! So, money has instead become a faith based system where printing more money only reduces the value of your currency because it increases inflation of prices, not a disparity between real gold value and paper money in circulation. Now, the US is not broke. Printing your own money doesn't mean its worth anything unless you have an economy that actually does well. We are in debt, but not broke. Dumbass!

Answer 4

America does makes its own money that is true, but if they print tons and tons of money, the US dollar becomes more and more worthless (massive inflation) and this will be severly damaging to the US economy. If you want a similar historical case look into Germany following WWI, where the german government printed off tons of its own money to pay off massive war debts and caused inflation so high that the money nearly lost all of its value.

Answer 5

OK so in the 1970's our president decided to loan every country
that asked ,the money they needed for this that or the other to them ,then they decided screw America and didn't pay us back,
I'm not sure of the exact amount, but it's in the billions and that my dear is the history of our great nation

DON'T YOU GO TO SCHOOL?

in other words they took our money and now we are broke!!

Answer 6

Let us start with- the question was not a joke and the person asking did get a diploma from high school. In the south of Tennessee to be exact. I understand that some of us are here to inform and help the rest of the the human beings who honestly don't comprehend as much as others can and do in certain areas. The name calling and snide remarks was uncalled for. On the other hand some folks do this in order to build up their own self esteem. If you are so smart then why waste your time cutting other folks down and start spending your time helping to educate instead of trying to show how childish and ignorant you honestly are. Nobody forced you to answer this particular question and he is an adult with children of his own who one day may go to him and ask him this exact same question and I hope he doesn't turn to them and belittle them for asking such a very simple question which in fact has allot of history behind it. To those of you who took this question and answered it honestly my hat is off to you.
RESPECTFULLY YOUR FRIEND
MELODY T CROMER

Answer 7

Well it isn't broke yet. But as for printing money, yeah they are printing money right and left with nothing backing it up, except for the government's promises, which just about puts it as worthless.

Answer 8

Because the President spends $320 Billion on a war that's been prosecuted so poorly that we're likely going to have to withdrawl and pretend we won. Simultaneously, he works to cut taxes for the richest Americans while doing little to cut spending on pork projects like bridges in Alaska for his Republican cronies. If he does make cuts, it's in programs that assist the poor. So the poor people get to fight the war, while their families struggle and Dick Cheney gets to make money off of Haliburton's no-bid contracts in Iraq.

Do you remember when we actually had a budget surplus? Ah, those were the days.

Answer 9

.We use to have enough gold to match the amount of money we printed . The gold standard . But we now print more money then we can cover with gold .In other word we spend more then we take in , that's what 90 % of the people do in this country .What happens when you spend more then you earn and you borrow from every one you know . What will happen if the countries call in their loans , they will own us lock stock and barrel

Answer 10

America is B R O K E, and if you don't believe that...you need to do some searching around. If your putting your trust in money, I warn you...we could go down at any moment, be careful.

Answer 11

We may make our own, but we also borrow from the world bank. We spend a lot of money on military(ie. war) and other areas so we always find ourselves with a deficit.