How can there not be not enough money in the world, if they can make it on machines?

Answer 1

It's a bit of a non-question really.

Who says there's not enough money in the world?

Money has value because people believe it does. These days it has practically nothing to do with gold reserves. It is simply that we agree to use it as a form of payment.

If one increases the supply too fast then the relative value goes down, prices/inflation go up.

What you might be getting at, at a deeper level (though I have my doubts about that!) is that people cannot meet their needs because they don't have enough income...this is a genuine problem resolvable by having economies open to free trade, without excessive government regulation/bureaucracy (everywhere) and subsidies benefitting richer people, that prevent the poor(est) from investing and trading in the goods and services that will help them provide for themselves.

Answer 2

The value of money has to do with how much confidence people have in the money now, and how much they think they need to keep for future expenses compared to what is available. There is therefore a supply-side (which you mention) and a supply side.

If all of a sudden money started to fly (increase in supply) out of the printing presses, then definitely the real value of the money (that is what you can buy with it) will fall.
Prices will rise.

All in all if you double the number of notes printed, chances are prices will at least double, so it's self defeating.

Actually, some people believe that the real reason that the US invaded Iraq was precisely that Saddam Hussein was asking for Euros for Iraqi oil, rather than US$. What that would have meant is that countries buying Iraqi oil would prefer to keep Euros rather than US$ since that would be the currency they'd spend. (Decrease in demand for US$) The value of the US$ would fall.

This could have started a domino process whereby more and more countries would stop keeping US$, preferring the Euro, and given that the US has chronic deficits it finances by selling bonds, as the US$ loses value, nobody would want to buy the bonds, and the US would be in severe financial situation of a borrower to whom nobody wants to lend money anymore.

Answer 3

It's a good question, so ignore those people who call you an idiot.

I've heard that it has something to do with how much gold etc etc is in the treasury i.e. fort knox for the US. I don't remember ever studying this in school, but I do remember watching something about it on like Seseme Street or Reading Rainbow yeeeeeears ago lol.

But wouldn't being able to just print up more money solve A LOT of the worlds problems? Unfortunately, it just doesn't work that way.

Answer 4

Yes! You can print and made lots of money. But they got no value all. it will be just like a piece of art. In order to make a cent you make value at 1 cent. It must had some amount of gold deposited in he the central treasury fund. Let say you got 10g of gold value for 10 cent.And I have 5g of gold value for 10 cent. there I need two cent of mine to exchange one cent of your, and so the more you print the less it value, OKAY. This is how money go round.

Answer 5

Paper money represents the gold reserves that a country owns and therefore money cant just be printed. A Bank not is worth nothing but its what it represents which is off value. If you look on an english bank noe read the words "I promise the bearer the value of five pounds" or something!

Answer 6

because the more money you print the lower the value of each note. Abank note literally represents a share of the preciousl metal supply owned by a central bank and so, if there are more shares each share is worth less.

This is a huge simplification but i think it is enough to answer your question.

Answer 7

That's exactly what Mobutu thought when leading Zaire (now dem rep. of Congo) So he had the bank print out a 5 million zaire note. The value of money sank so much you couldn't even buy a loaf of bread with it. You need something to back your money with otherwise it's worthless paper.

Answer 8

when you make more money, the value of the money gets less and less. for example the discovery of america and its gold led to inflation.

henry 8th, king of england, said that he'd save money if he puts less silver in the coins. the result was - again - inflation.

so, yeah you'll be a multimillionaire but you won't be able to do much with it.

Answer 9

long long ago in a place not far away... Each bill or coin printed was supposed to represent a piece of gold or silver that was held in the national treasury.

Now i think the do just print it as they need it.

Answer 10

printed money has no value. If it did, all countries would just run their printing presses 24/7. So money needs to be backed by something. Like? GOLD!