Toribash
Original Post
Why don't countries fix depts by printing out more money?
In my idea i hear countries with no money and stuff but why doesn't the Goverment just print money? Is there a rule that stops countries from doing this?
blue
pink
Money = debt

You may have heard of something called prime rate.
It's an interest rate the central bank of a country puts on the creation of money. Banks of issue can order new money for said interest rates.
Without economic growth that system collapses because there'd be no way to counter the inflation. A small rate of inflation is also essential as without inflation there'd be no way to pay said prime rates.
Printing new money would actually increase the debt as well as lower the value of a currency. It'd only be a short term soluton to create artificial growth but it'll haunt you real quick.
nigerian PM
Originally Posted by Sacrafan View Post
Money = debt

You may have heard of something called prime rate.
It's an interest rate the central bank of a country puts on the creation of money. Banks of issue can order new money for said interest rates.
Without economic growth that system collapses because there'd be no way to counter the inflation. A small rate of inflation is also essential as without inflation there'd be no way to pay said prime rates.
Printing new money would actually increase the debt as well as lower the value of a currency. It'd only be a short term soluton to create artificial growth but it'll haunt you real quick.

k
[18:04:54] <aracoon> Eureka is a powerhungry fag
______________
[13:13] <Eureka> also dota is kinda for pigfuckers
[13:13] <jalis> ban eureka
[13:13] <jalis> thanks
Ask Zimbabwe.

Shamed, son. Do some research.
Last edited by Erth; Jun 9, 2013 at 08:48 AM.
She/They

Yeah, I only don't like erthtkv2 because of the mod's name. Make it "tkv2," and the mod will instantly become more popular. This is a valid reason as the name of the mod is still an important feature that no one seems to have yet discussed.