This may be a silly question but ....?

Question

Soo I know this is just a little weird but,

So the econemy is terrible right now why doesn't the goverment just make more money? Like literally make more dollars and just hand it out or give it to bussinesses really it's just paper and we can just make more.

Please no mean answers, seriously.

Answer 1

No. Products would rise. Its inflation. If we gave 100,000 dollars to each person simple products like milk and bread would go up to 5 or even ten dollars a gallon. That is why we make money and destroy old bills. American only makes about a couple billion dollars in new money a year.

Answer 2

More money simply increases the volume and velocity of money and that increases the purchasing power. Sounds like a good idea but when the money supply increase substantially in the absence of an increase in the production of goods and services bad things happen. Consumers bid-up the prices of existing good and services and having more capital they demand more quantity than before. That means that demand now exceeds supply which also forces up the costs of goods and services. The producers pass those costs along to their customers and the cycle continues unbreakable.

A stable economy seeks and finds the point of equilibrium. Government intrusion and private fraud, among other things, causes the factors which lead to equilibrium to become volatile and non-responsive to the point of breaking the system. This is when recession occur.

You don’t know how to breath but you do it because a series of actions take place which drives the function of your lungs. Interrupt just one of those and suddenly breathing which you do every day without bother suddenly becomes a labour intensive task; possibly even requiring artificial input. The economy works the same way.

Answer 3

I think it might cause higher inflation because if there were more money, business would charge more and our money would be more worthless. I think. (I've sometimes wondered about this myself. We're not on a gold standard anymore.)

Answer 4

The government making money is what got us to this point in the first place. Money has to be backed by something, currently it is backed my the word and faith of the fedral government.  The supply of money has been so loose that banks were lending to any one and everyone, no matter the fact that some could not pay the money back to the bank.

Over all a Bad idea.

Answer 5

Because then your money would be worthless and your economy would crumble, no-one would work etc. Money is a global issue not just about an individual country.

Answer 6

because if they do the USA money would lose value just like the USSR it lost so much value that one USA doller was Worth trillions of money

Answer 7

that would cause run-away inflation and totally ruin the economy (contrary to what libs will tell you, the economy is not already totally ruined).

Answer 8

I think it is a good question, and I see many have already correctly mentioned that it would cause hyper-inflation.  You need to think of the dollar as more like a check.  The check (and the dollar) is worthless in itself...it is just a piece of paper.  The promise is what is important...that there is value behind it.  The dollar is the U.S. governments promise that there is gold behind it.  If everyone in the world started cashing there dollars for gold we would be in serious trouble.  If we printed more there would be more dollars but not more actual worth behind it...driving down the value of every individual dollar.

Answer 9

Because if you print too much money the dollar becomes less valuable.

Answer 10

That would be a very, very bad idea.

If the government did just print more money you would end up with an economy very similar to Zimbabwe.

let me explain it like this:

if you had 2 dollars and the only thing you can be is an ice cream from a small shop then the ice cream will cost 2 dollars, if you then print out 10 dollars then the ice cream will cost 10 dollars and so on until you could ne printing yourself 1million dollars and the ice cream would cost 1 million dollars.

Its got to do with inflation. It would up by 300% a minute if that was what would happen plus it would make the dollar really weak...assuming you live in America...I live in Ireland.

hope this answered your question

Answer 11

No offense but that would be the worst idea.   By making more money, it decreases the worth of the American dollar.  Lets use this for example 1 US Dollar =  7.79843 Hong Kong Dollar (whatever they are called...think its yen).  For every US dollar 7 Hong Kong Dollars euqal it.  So the US dollar is 7x more valuable.  So say we doubled the cash in America ..

2 US Dollar =  7.79843 Hong Kong Dollar thus

1 US Dollar =  3.8992165 Hong Kong Dollar   Now are dollar is only 3x as good as theirs.

Answer 12

printing money like that would lead to run-a-way inflation

it just makes things (much) worse.

Answer 13

Doing this would have serious economical and societal consequences. All of which are extensively covered in this wikipedia article:

http://en.wikipedia.org/wiki/Monetary_Po...