Is there a standard or they just print money whenever they need more cash?
2007-05-23 06:19:55 · 7 answers · asked by jflsdkjflsad 2 in Social Science ➔ Economics
The fed is actully printing money constanly to repleish the supply. However the Federal Reserve use the amount of money in supply using a model to help and control the intrest rate. But like most other things in Economics the the amount of money demanded affects the intrest rate it is a very complicated process to determine how much they want to increase or decrease the money supply. But even then for the most part it is not done by just printing more money. So the Simple anwser is that they only print enough money to replinsh the money that is old or outdated.
2007-05-23 17:07:44 · answer #1 · answered by Michael N 2 · 1⤊ 0⤋
NO. You are oversimplifying. There is a very strict formula for determining which currencies are to be printed and in what amount... Just routinely printing money regardless of the needs is a fast way to have rampant inflation
Visit a Mint near you and take the tour and you will hear all about what goes into printing money.
2007-05-23 13:27:33 · answer #2 · answered by Anonymous · 0⤊ 0⤋
In short the answer's no. If they printed money whenever they felt like it or just printed more to pay off their debts, the increased amount of money devalues the money that is already in circulation. It's known as inflation (or nowadays monetary inflation). Print a lot of money in an attempt to make your country richer >> hyperinflation, whch lead to an unstable economy. The amount printed must be kept carefully in check.
2007-05-23 13:31:04 · answer #3 · answered by Anonymous · 0⤊ 0⤋
no, there's a formula for calculating how much cash is in circulation... I believe it's strictly watched but the national banks ... if you just start printing $ whenever you feel like it, you would ruin the country's economy....
2007-05-23 13:28:52 · answer #4 · answered by bustedsanta 6 · 1⤊ 0⤋
No, there is a spacific amount of money in spicific amount of currancy in circulation at any given time
2007-05-23 13:32:02 · answer #5 · answered by Anonymous · 0⤊ 0⤋
the currency is backed by a percentage of gold and silver. . .it used to be 100% but it is much lower now. In other words they used to only print a dollar for every dollar of silver or gold the gov't had reserved for it but now its say 33% so they print 3 dollars for every dollar they have in reserve.
2007-05-23 13:28:44 · answer #6 · answered by jason w 1 · 1⤊ 3⤋
http://www.treas.gov/education/fact-sheets/currency/distribution.shtml
2007-05-23 13:29:36 · answer #7 · answered by duker918 7 · 2⤊ 0⤋