ok, im a dunce when it comes to economics and i don't understand how a piece of paper with george washingtons face on it can rise and fall in value for no apparant reason.....but if the us mint makes all the money, why can't they just print up a million thousand dollar bills and take them up in a plane and drop them over impovrished neighborhoods..?
i mean, they got the printing presses that make the money...why can't they just make alot more money in bigger denominations and hand them out to poor people.....i mean if i had a money maker, thats what i'd do
2007-03-14 08:56:58 · 6 answers · asked by Scotty R 1 in Social Science ➔ Economics
Ok, when i was little i thought that too.
BUT if u print more money u would have this...a huge inflation, and whats that? a rise on level prices, why appear? because making more money makes people feel "richier" and buy more the demand would be expanded and the price would be higher. Also ur wage will be the same and the real value(what u can buy with that money) of the money would fall down.
Imagine that to buy a candy u have to pay $2 after printing money thinking that it would not have consecuences then the candy would cost $2000 and ur income is of $1000.
Other direct consecuences of printing money (that if ill explain everyone of it the answer would be too long): inestability on the labor market, higher costs of production, poverty, bank crisis, down level of investment, corruption, politic crisis, GDP falls...ECONOMIC CRISIS.
2007-03-14 09:29:04 · answer #1 · answered by dsro 3 · 0⤊ 0⤋
Money is not a just piece of paper, it's has real value - the value of stuff you can buy with it.
If you print more money, but you do not make any more stuff to buy, it will only raise prices and hurt those who have savings and flat-wage jobs.
You could impose price controls, but then there will be no stuff in the shops, and long queues whenever anything shows up - just the way Soviet Union was.
2007-03-14 16:14:50 · answer #2 · answered by Anonymous · 0⤊ 1⤋
Great idea -- but I think YOU should just print the money yourself with a good laser printer and give it to poor people. The government will really appreciate you saving them money. You'll probably get a medal.
2007-03-14 17:09:33 · answer #3 · answered by KevinStud99 6 · 0⤊ 0⤋
Because it is not as simjple as that.
Printing more money would simply raise the rate of inflation, thereby devaluing the dollar.
It would exacerbate the problem and increase the difference between the rich and the poor.
2007-03-14 16:10:05 · answer #4 · answered by Anonymous · 0⤊ 0⤋
You are correct, you don't know much about economics. Your propopsal would devalue the dollar so much that we would soon be like mexico (the mexican peso was actually worth something at one time until they did pretty much what you are describing of doing (just printing millions and milliions) only they used the money for a different purpose)
2007-03-14 16:06:19 · answer #5 · answered by kerfitz 6 · 1⤊ 1⤋
I don't know if that would solve the problem but I'm sure it wouldn't hurt.
2007-03-14 16:05:02 · answer #6 · answered by shorty 6 · 0⤊ 2⤋