Friday, January 20, 2012

What is stopping the Federal Reserve from just printing more and more money? (paper due!!)?

Hyper inflation is the biggest deterrent. Printing more money lowers the value of the dollar, raising commodity prices such as oil. Commodities such as oil are traded on the world market based on the value of the dollar. It would also create trade tensions with the rest of the countries in the world. A lower dollar value makes our products cheaper and theirs more expensive. The countries that have trade agreements with us expect us to play fair in the world sand box.

No comments:

Post a Comment