Is there a set limit on making cash money? If so, how to they control it?

Question

I've been wondering for a while on how the government keeps track of how much cash money they make. Since people (everyone.) lose their money from time to time, how do they keep the useable cash balanced? Also, if our country needs more money, why not MAKE more?

Answer 1

The money used to be backed by Gold--it was the gold standard. That was a huge politacal debate at the turn of the century should it be gold or silver. William Jennings Bryant was the presidental candidate backing the silver standard...he lost so you can guess what happend.

But now there is nothing backing the money in that sense, it is dictated by the market value not any actual standard.

The government strictly controls how much money is out on the market, it will retire money and issue a strict number of bills.

If you put too much paper money on the market you will devalue it, that was a giant problem for Russia in the 90s.

Answer 2

I think you need to take a short course in economics. The money the government "makes" is theoretically backed by something of real value...like silver or gold kept in the government's treasury. It isn't worth anything if they just keep making more. Banks take bills out of circulation when they get too worn or dirty. They turn them in and the U. S. treasury destroys them and replaces them with new ones. The money ordinary people lose either gets picked up by someone else, or just disappears, but it doesn't amount to enough to worry the government.

Answer 3

IRS and the Federal Reserve Bank has your money. That's how they control it. Oh did I mention that BOTH are not federal nor government owed??? Did I mention that they are private businesses? Hmmmmm I wonder who owns those companies? WHo OWNS YOUR MONEY???

Answer 4

there are 1000's of people who work for cash and don't report any income, the IRS find it often from your bank records, interest paid ( they get a copy of that) and if you deposit large cash amounts, it gets reported to the government also.