If the govt prints the money, then why are we in debt?
Answer:
because the money that they print is worthless. they are supposed to have an equivilant value of gold or precious metal to
equal the ammount of money that they print. however they print more money that they have the gold to back it up.
and this decreased the value of the printed note.
then thay give money away to other countries in the form of loans that they never collect on and go into debt with people that they have borrowed from.
Printing money has nothing to do with why a gov't is in debt.
Debt results from spending more than you make. If you spend more than you have, you have to borrow the difference.
They spend it as fast as they make it, so we never catch up
If the gov prints too much money, then there would be massive inflation, and money would be worthless. Look at the German mark during wwii era, where the covered the cost by printing more money, and eventaully a loaf of bread costed 200 million marks
cause they have to keep a certain amount in circulation in order to keep the economy going.
we are in debt because the govt has sold bonds to other countries.
Simply stated;
Money is only representative of the assets owned by the country. It does not, in & of itself have value. The government can't just print more (legally) without having the assets to back it up.
Thus, we borrow from other nations and because we borrow, we are in debt. Much like the what happens when you or I take out a loan or charge something on our credit cards.
We can't just print any kind of money that we want whenever we want. That will lead to inflation, becuase then there won't be suffient gold/silver in the treasury to back up the money that is being passed around, and that means a decrease in the worth of the dollar and an increase in cost of everything. Inflation has already increased prices drastically over time (for example, gas was 50 cents only about 30 years ago, etc.), and on average, inflation is not good. Since all world curreny is linked to the dollar now, it wouldn't be good to decrease its value.
It's not as simple as just printing more money! Jeez...
That would only make inflation worse. What good is having truckloads of $100 bills if they aren't worth jack??
printing money causes inflation, devalues your savings and wages, so it is better to borrow money.
There is a limited amount of money the government can print duringa period of time. If it prints too much then this will simply cause inflation (the value of a $1 will go down) so printing more "paper" does not result in more "money"
they can't solve their debt problem just by printing more money. the problem is, the more dollars you print, the more there are of them, and the more people have a lot of them. that makes each individual dollar worth less. foreign governments don't just want our government handing them a bunch of dollar bills, they want to think we can actually back up our money. and we can't, yet. that's why we're in debt.
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