Why some countries don't fabricate more money in order to buy more goods and services?

Question

why they dont fabricate more to distribute and stop being poor?

Answer 1

It would be pointless, their money would just be worth less.

Answer 2

Money, is a good like any other good. So, people are in demand for it. Let's say you have some (let's say 10) apples and I have some shirts (let's say 10). You want the apples and I want the shirts and we trade, one apple for one shirt.

Now, let's say you have the same amount of apples and I have 10 times the amount of shirts as I did previously. I only actually need 1 shirt, so I am willing to trade away all other shirts. You only need 1 apple. People don't have much use for shirts after a while and so, for the first you may be willing to trade 1-1, but for the second trade you probably won't be willing to trade at 1-1, since your apples are now getting scarce and you have a shirt. Though, you are still willing to trade, but at a higher rate. So, the price is now 2-1. This continues to happen until one of us is no longer willing to trade apples for shirts.

Now, consider instead money, in this case we are talking about fiat money, or money which has no backing like our Federal Reserve Notes. If I have a large supply of it, your apples are still scarce. You will demand a higher quantity of money, assuming other people will in turn value this money at the same rate. If I am unsure about the prospects of being able to sell this money for some other good or service at a similar rate, I may discount it into the future (meaning I will charge even more - this is sometimes called "built in inflation"), or I may not be willing to trade for money at all, which is what happens in countries where their supply of money is severely devalued. In these cases, Turkey most recently, the barter system takes over.

Answer 3

MOney is worthless unless it has something of actual value to back it up... inflation becomes problematic when you just print a bunch of money... its been tried, by the Nazis in WWII and by the Confederates during the latter part of the Civil War. People aren't stupid... if you just print tons of paper money it soon costs $30,000 for a loaf of bread.

Answer 4

AFAIK it creates inflation due to the money losing its purchasing power, as the nation wouldn't have the resources to support the money (i.e. Gold). Further, considering that their is an international monetary exchange, currency competes with other currencies & value fluctuates.