What if we just printed more money?

You know the answer is inflation, so why does it happen?
Money's value derives from goods and services, not from the paper it's printed on. Simply printing more money won't spawn more goods and services. It just spreads the same value over more dollars, the phenomenon you called inflation. Double the money? Double the prices. If everything costs twice as much as before, we're not better off.
Remember, our wealth doesn't come from money itself, but from the goods and services money buys. So, printing more money? Not the solution you'd think it'd be.
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[@Skye-xl5lx]

I blame the Fed for global economic crisis, they can print credit as long as someone will borrow it into existence, but production cannot be printed. Right or wrong?

[@heatherholdings]

right! never can tell what the future holds, definitely a time to consider financial planning and not time for blames

[@valentinaarrelaro]

True, I'm quite lucky exposed to personal finance at an early age, started job 19, bought first home 28, got laid-off work 36 due to covid-outbreak, and immediately consulted a financial planner to handle growing my finance. Long story short, I'm only 25% short of my $1m goal after a couple 100s of thousands invested so far.

[@Castro-worldbravest]

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[@valentinaarrelaro]

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[@sergiopawson]

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[@jesserobinson20]

Quick, someone tell the government!

[@Ninjaturtle999]

😂😂😂 you’re an ediot

[@noobnooby2054]

Its a shame the federal government missed this lecture in economics 101 :(

[@darthhodges]

I imagine it as a balance that is locked in place. On one side is all the money (physical or digital) that exists. On the other is all the things that are for sale (goods or services). Both piles change in quantity continuously, but are always equal in value to each other. If the currency pile grows faster than the goods and services pile, that's inflation. People with lots of debt but also lots of assets can exploit inflation to get out of debt more quickly, but it hurts everyone else. Deflation is when the money pile grows more slowly than the goods and services pile. This is good for people who like to save money and spend carefully but bad for people with lots of debt and no assets.
That's why governments favor inflation. It makes sense to rich (read: all) politicians to have an inflationary norm they can use to get out of debt. But they don't use the opportunity to get the government out of debt, only themselves.

[@ryansears4387]

The mathematical principle known as the Pigeonhole Principle makes it clear that MATHEMATICALLY, prices *MUST* increase when you expand the money supply more/faster than the number of goods/services offered. Money is the "pigeons" and goods/services are the "holes".

[@chevyfeltz8788]

They could mass produce instead of inflating no?

[@ryansears4387]

@chevyfeltz8788 You can only mass produce so much. You'll always be in "catch-up" mode with production. Increasing production requires time and resources.

[@chevyfeltz8788]

@@ryansears4387 that’s true

[@madewhole-ev4uy]

But why is it a must it looks like an excuse to inflate prices 😅

[@ryansears4387]

@madewhole-ev4uy To illustrate the concept I'll use a small economy, let's say $100 and 50 goods/services. If we evenly distribute the $100 across the goods/services, we get each good/service at $2. Now, say we increase the currency supply from $100 to $200 without increasing the production/supply of goods/services. So, now we have $200 in our economy evenly distributed amongst 50 goods/services. Each good/service is now priced at $4. This is why, mathematically, the prices of goods/service WILL rise during inflation. The inflation happened when our economy went from $100 to $200. And that's what happens when governments print currency out of thin air. It's also why the purchasing power of the dollar drops because, in our example, what $4 bought after the inflation used to be bought at $2.
Now, let's say some really bad thing happened **wink wink** where the amount of currency in the economy increased, but the amount of goods/services decreased due to cuts in production/supply. For sake of our example, currency goes to $200 but goods/services offered goes to 25. NOW, each goods/service costs $8!
This is an extremely simplified example. But it illustrates how inflation works. The inflation wasn't the price increase. The inflation was the increase of the currency supply, and the price increases were a natural consequence of the inflation.

[@brandongovreau9218]

why not make it a law that you have to have goods and services to match the money supply at all times

[@LearnLiberty]

Regulations cause negative consequences. It’s more efficient to stop printing money and reduce government spending.

[@baha3alshamari152]

That was the case until president Nixon decided to print money with no regulations so he can finance Vietnam war

[@AlanSito-md2ji]

They do they print as much as they want AND distribute It between about 1k people still making It scarce for the rest of 400 million people

[@andrewjones2222]

Print money without raising prices. It’s all a social construct. The status quo needs to change.

[@gi169]

LL stick with this awesome content.

[@pinnacleroofing9841]

But when the prices double the gov't says "look how much richer you are, now you owe us more"

[@zekornizstudiosgh]

Still doesn't make sense to me at all. We can also keep prices where they already are and print more money to help those who don't have. The rich just want to stay rich, that's the simple truth.

[@reygarcia6398]

Spoken like a true zimbabwenomist .The money will be more worthless like in many hyperinflation cases

[@baha3alshamari152]

By giving more money to people you are just increasing the amount of money but the value is still the same so you get inflation

[@Alejuandro.6500.]

Then your just low-IQ'ed

[@weswatts531]

L take

[@Peacefulnessxxx]

Just when most of its digital not to mention the introduction of money via loans.

[@user-ol7tl1vf5m]

Imagine a dollar as an inch on a ruler. A foot of lumber cost 12 inches. Today that equates to $12 dollars.
We counterfeit a couple trillion dollars to add to existing supply. Now back to our lumber. A foot of lumber still costs 12 inches. However, the dollar no longer equates to an inch, but instead because of the added units, equates to 1/3rd of an inch. 12 inches now equates to $36 dollars.

[@redenjrpamaybay1253]

Double the printing of currency double the lost of purchasing power..prices never rise it contrast currency lost its value..

[@uristrauss6106]

Who proposes just printing more money? The proposal is for governments to print and *spend* the money in counterinflationary ways. It takes investment to create goods and services.

[@skeleskele]

Nobody proposes just printing money, but thats what happens when you spend money you do not have, the fed reserve prints it. Spending the money in "counterinflationary" ways doesnt really work, as you still printed the money, so inflation still occurs?
The issue isn't how government is spending it, its the fact government printed more money, spent/invested it and now more dollars are chasing the same amounts of goods and services therefore causing the prices of those goods and services to rise, since the value of those goods/services havent changed but the value of the dollar has decreased

[@uristrauss6106]

@@skeleskele if the money is spent in ways that increases the public welfare, like on health, education, housing, infrastructure, and does so wisely, then it increases the amount of goods and services. That’s what I mean by counterinflationary spending, and it can reduce inflation.

[@skeleskele]

But you just printed more money? And then spent it on services, which those companies will spend so it circulates, and then overall you get more $$ chasing the same amounts of goods and services. You may have temporarily created a new hospital or whatever but then that construction company will spend that profit $ to their employees and to other businesses, which doesn't magically create more goods and services. So you still get inflation regardless of however you invest it (which is still spending it)
You cant just print money and invest it "correctly", that just doesnt prevent inflation whatsoever, will worsen it bc you printed more money and are circulating such $

[@uristrauss6106]

@@skeleskele are you saying that it’s impossible that the increase in services negates the increase in money supply? If so, I don’t see how you can reach that conclusion.

[@skeleskele]

@@uristrauss6106 are you saying you can print more money and spend it yet call it "counterinflationary"? How would one ever come to such an absurd conclusion when thats the direct cause.
Its a very simple issue, with one solution, stop printing money (which means government cannot spend anymore bc it prints to borrow it)

[@user-mi6js5dw1w]

Don't tax people and see how inflation rises 😅😅😅

[@georgeemil3618]

No chance. The money eventually flows upward to the top superrich and out of the economy into secretive overseas accounts. So the superrich is part of the process that keeps money-supply and therefore inflation low.

[@hackerbrinelam5381]

Well I agree this applies to common currency/money but not the USD, acting as the world`s currency while still serving US interest has given it extra properties. On the micro level, yes money is money but on the Marco level, USD is powered by US military might, techlogical superiority and the transaction system SWIFT. As it says " the USD is not our problem, it's yours". Backed by being the world`s currency, inflation in local US is not really a big problem, as with the control of interest rates, nations all over the world have weakened economies and US Capitalists can acquire their assets plus other countries have to have USD as that's the only form of trust/value, further sucking the excess USD away from US currency pool. Tho as US continue to abuse this power, dedollarization will make this extra properties disappear n US locally will suffer.

[@baha3alshamari152]

Afghanistan is under embargo since 2021
They can't use USD , It was done because US government was salty about their failure there
The Afghans figured out that bartering despite its flaws is better and more reliable than USD
They have Lithium and fruits so they give certain amounts to China in exchange of goods like electronics and oil and....
Ghana buys goods with gold instead of USD and Russia exchange goods for gold and diamond and oil
While the need for currency is still there and can't be replaced with bartering bartering nevertheless minimize the USD amount needed for trade

[@TheInternetLove]

If you print money who will you give it to?

[@user-mi6js5dw1w]

Does not happen because taxes are increased so you paid that inflation

[@CVerse]

Ok then just stop printing money

[@baha3alshamari152]

But the government and the rich don't like that

[@chevyfeltz8788]

So it’s our own fault ? And yet we still could give a shit less..

[@user-do3hr9qy9w]

Not worth anything lost 98% of it’s value

[@BruceWayne-ne1ez]

I think if the rich get more rich
The more money must be printed to back up the Increasing number.