- July 26, 2011 at 11:53 pm #44011
If we are in debt to the treasury or the treasury is broke, why cant they just print more money to get us out of debt. I have never followed politics, so I probably sound really stupid, but I would like someone to explain it to me. (As broken down as possible please. )July 27, 2011 at 12:38 am #190781
Because that causes inflation and devalues dolar.
Money is nothing but a representation of the economic power of a country, if you print more money you don’t change your economic value.July 27, 2011 at 12:53 am #190782
you need to do some research on inflationJuly 27, 2011 at 1:10 am #190783
That is slightly illegal, so no.July 27, 2011 at 2:03 am #190784
Okay so basically we did the dollar value will go down. So pretend there is one gold nugget in the world right. So that makes I really valuable, yet if there was hundreds of them than the value will go down since here are a lot of them. So if we print to much money our dollar will hardly be worth anythingJuly 27, 2011 at 2:20 am #190785
The reason they cannot print more money is because everytime more money is printed off the value of the dollar goes down so say in the United States the dollar is worth a little more than a canadian so if they print more the value would decrease to the point where we would have to pay more for everything without increase of pay.July 27, 2011 at 2:26 am #190786
Simple answer without going into major detail is the more they print the more worthless it becomes,
If you had 1,000,000 collector items they would be worth so much, but if there were only 50 they would be worth more because there are not that many out there.July 27, 2011 at 3:09 am #190787
basically they already do that and the only reason they can is because the dollar has reserve status.. pretty soon there will be nobody left that will buy t bills though if i understand it correctly, the fed is already about the only buyer, buying t-bills with printed dollars .. it has to stop somewhere .. the money gets dispursed into the system and devalues the currency.July 27, 2011 at 3:32 am #190788
First of all, the U.S. Treasury has illegally ceded that responsibility to the privately owned Federal Reserve.
Secondly, if money were printed wooly-nilly, the value of that money would fall sharply. Which is actually happening!:July 27, 2011 at 3:43 am #190789
Ever since we dropped the gold standard there is nothing to back our moneys value, so yes its worth only what we say it is. However the more money in circulation the less valuable it is. We cannot pay our national dept this way because we owe other countries money for material goods and such. For example. You make koolaid, but as you drink it you add more water after a time the koolaid is no longer sweet or flavorful but there is still the same amountJuly 27, 2011 at 3:46 am #190790
a question allot of people ask. but if we just printed mass paper money it wouldn’t have a value would it? i mean a 5 pound note is only worth what we say it is. so if we pumped loads of money into the economy then we would start thinking whats the point in this paper? because the same situation happened in Zimbabwe the government just printed more money and now everyone had wheelbarrows of million (whatever there currency is) notes. which was worth nothing due to bread and tax’s had risen. you cant just “print money” because that money has to go some were. and who are we in debt to? if printing money was as easy as you think it is. it wouldn’t work would it? because money enters the public no matter what e.g paying builders for road works.
Money-creation and growth in money supply is not bad in and of itself, but it must be based on economic fundamentals. If there is not a corresponding increase in the production of goods and services, then inflation will erupt, as too much money chases the same amount of goods and services and prices are bid up.
The point is that it is good and normal to create new money, but that is limited by what the real economy can absorb, otherwise inflation breaks out.
The Tech GuyJuly 27, 2011 at 4:17 am #190791
Because that would lead to inflation, which would only worsen the current economic situation. Inflation is the increase in price and decrease of the monetary value of money. In other words, printing more money would only decrease its value. This means that more money would be required to be something at a certain price. For example, let’s say that the price of a water bottle was $ 1 before inflation. Now let’s imagine that after inflation you now need $ 10 to purchase that same water bottle.July 27, 2011 at 4:24 am #190792
The government borrows by selling Treasury securities to investors
The value of the Dollar is is determined by how many bonds private investors are willing to hold If the government were to “print” the debt, (which would actually involve the Federal Reserve buying more bonds), investors would sell off their bonds, the value of the Dollar collapse, and you would pay $ 1000 for a loaf of bread very shortlyJuly 27, 2011 at 5:09 am #190793
Not really a dumb question. I hope people are being nice to you about it. Simple explanation is picture you and five other people are playing poker. You each have exchanged 100 dollars in cash for 100 dollars in chips (one dollar per chip). At the end of the game, you will exchange your chips for cash.
But what happens if one of the players has a little machine, and as he runs out of chips, he just makes some more? It devalues the worth of all the chips. At the end of the game, there should be (regardless of who has them) 600 chips, and 600 dollars in cash. But because of the dude with the chip machine, there is 600 dollars in cash, and 2400 chips. So instead of each chip being worth a dollar, each chip is now only worth 25 cents.
So if the government just prints more money, the money looses value. It is already happening. Prices are not really going up, the value of our money is going down.
Lets say during your poker game, you go to the bar, and buy a soda for one chip. Soda cost a dollar, the chip is worth a dollar. Later, after the chip machine dude has made a ton of extra chips, you go to the bar, and a soda now cost 4 chips. The value of the soda did not change, it still cost a dollar. It is that your chips are worth less then a dollar now.
Hope this make sense. Hope you didn’t think I was talking down to you.
Have a great day.July 27, 2011 at 5:29 am #190794
Because money IS debt. We can NEVER get out of debt with the current system. Period. Since the *private corporation* the “Federal Reserve” (nicely given name- makes you think it is a US government entity, doesn’t it?) was given over control of the money supply, we must “buy” money with interest-bearing government bonds. The bonds need to be paid back with interest. Where does the money for the interest come from? By selling more government bonds for more money, which is also charged interest.
In other words, “Printing” your way out of debt is akin to digging yourself out of a hole or standing in a bucket with both feet and trying to lift yourself off the ground. It can’t happen. The system is designed as a giant ponzi scheme to enrich the few at the expense of the many- you and me.
There is a way out, which is issuing our own debt-free currency and raising the reserve on the money changers (the banks) to 100%, meaning they could NOT loan out more money than they actually had. In less than 5 years all of our debt could be repaid.
President Andrew Jackson did this, printing greenbacks (backed by “the full faith and credit of the USA”). He was immediately attempted to be assassinated. Luckily, both guns misfired and the President lived. It took 70 years for the banks to regain control.
Another famous President tried the same maneuver. He signed an executive order to print, essentially, “greenbacks”. You may run into one occassionally. It is noticeable by the date 1963 and the red ink on the front of the bill. That president was promptly assassinated a week later. His name was John F. Kennedy. His replacement, President Johnson’s first act was to undo this act and set the banks back on course.
When you know the truth, it is not only not stupid, it is absolutely terrifying.
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