"Mom, since the U.S. is in such bad shape and needs money so bad, why doesn't the government just make more? {insert MDJ chuckle here} Seriously Mom! What's the big deal? Why can't they just print up a big batch o' bills whenever they need more? Why NOT? It's ONLY paper!"
I dunno if I was so stunned that he actually THOUGHT about this dire economic issue of ours or if his question just threw me for a loop cuz it was so completely outta character of the kid (cuz he's NEVER been that deep before) but I just couldn't answer him. But quite honestly, when ya think about it on its most simplest level (in other words, in MDJ's simple-ass mind), he kinda hadda point. What IS the big deal about just firin' up the ol' machine 'n printin' out MO' MONEY? Let's just pay off our bazillion dollars of debt 'n begin anew, right?
I myself ain't feelin' so darn great today either. For the past 3 days I've been feelin' like a cut pig (altho I really outta look as darn good as THIS)
but to spare ya I ain't gonna go into any more detail.So folks, I'm countin' on ya to help me out here. Pwitty pweeze?...with bacon on top!
9 comments:
Hope your boy feels better soon Jean. Now I'm no economist but my thinking is that the more there is of something, the less it's worth. Think diamonds - expensive because they're reasonably rare and hard to obtain. Printing more money means the value of that money decreases: more money = higher inflation. This means that you can buy less with it so it doesn't solve the problem. I'm sure someone a lot smarter than me withy provide a better answer Jean so I'll pop back later and have a read too.
Hell, that’s what I thought we were doing. We’re just printing money right now; we’ve got nothing to back it up with :(
Part of it is based on gold. What a country owns and can put up agin the dollar. Also factored in is how much and who they owe money to. Like the national debt.I think thats how it works. It's not the paper. Mexico did that back in the 70's when they had it real bad. 10,000 paso's could not by shit. But your greety, lying ass banker could tell it better.
The way I understand it, it starts with the basics of Webster World's comment and creates a situation like the one Lou described. Look at it this way. You right checks against the amount of money you have in the bank, they print money based on the amount of gold there is in the treasury. Least...that's my understanding.
It's basically what has been said already. Jeff Foxworthy did a comic routine years ago about a repo man coming to his house and telling him if he didn't hand over 200 bucks he had to take his car.
He answered something like who's got that kind of money lying around the house? The repo guy says, "You can't write me a check?"
A check? Hell YES, I can write you a check. Shit, may as well pay the thing off right now!!!
Tell the kid it's not about how many actual BILLS are in circulation either...it's who ends up with them. Even if they did print up more money just for the hell of it, what do you think the chances are you or I would see any of it??
MDJ:
When our son was younger we used to go to comic and toy shops. I didn't carry a lot of money but whenever I needed some we would head to the bank machine.
One time he wanted a toy and I told him it was too expensive and he said, "can't you go to the Bank machine and get more?"
I think there is a ratio between gold holdings and the amount of bank notes that can be issued.
bob
bobskoot: wet coast scootin
Gold really has nothing to do with how much paper we can lay ink on anymore. Nixon did away with that in ’71.
Pink Floyd said it best, "Money, it's a crime
Share it fairly
But don't take a slice of my pie".
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