The Continuous Printing of Money

[BitcoinGuruOne]

You have mentioned 2 countries where their economies are relatively small and " printing money " has immediate consequences. Also their product shortages are a big factor.

That being said consider US which indirectly is doing the same thing only with help of financial instruments, for example, fractional loans. Fractional loans means that bank CAN give out 10 times !! the money they have . This does not have  immediate consequences but shows how fu**ed up the financial system can and is.

[1714709601]

1714709601

[South Park]

A long history of fails. Free printing of paper or otherwise worthless money allows unprecedented growth at first, but then the currency inevitably declines to nothing, often causing chaos. Interesting article about China's first attempts at it: http://news.goldseek.com/GoldSeek/1216647867.php 

Even the Romans, though they had coins, would debase them through lowering the valuable content over time, or also by clipping the coins (I believe), which also proved economically detrimental, though temporarily advantageous for the Emperors.

Have a great day,
The Cyberius team.

That is why printing money without any restriction is so dangerous, at first it may give the impression of great prosperity and everyone is happy with the results but instead of accepting that temporal good fortune those that have the power to print money keep doing it, and then after some time they begin to see the consequences of what they are doing but by the time they do it is too late, now they are immersed in this new reality and if they stop printing money then the economy collapses, I would think that after so many historical examples of this happening people will avoid this path as much as they could but the temptation of free stuff seems to be too strong.

I think you hit the nail right on the head: the temptation of free stuff is too strong (as the Bible says, the love of money is the root of all evil). Then there's the fact that with the so-called "Federal Reserve" (which is neither), the whole system is based around monetizing debt, with the government ending up owing the FED (and as the Bible says again, the borrower is servant to the lender). There's a section in this article (subheading: "How the Fed Monetizes the Debt") that seems to explain it well: https://www.thebalance.com/how-is-the-fed-monetizing-debt-3306126

Have a good day,
The Cyberius team

By nature most people are lazy, after all working is hard and if possible we would like to avoid the toil, so we are always trying to find the way to do the less work and get the best results, this has a positive side in the form of the technologies humans have created to make their lives easier but it also has a negative side and printing money is one of them, many people think that the more money in circulation the richer is the economy but we know that is not true, the true value of an economy comes from the products and services it generates and a bigger money supply just generates inflation and more money available to chase for the same products and services.

[RivAngE]

Funny you mention Venezuela, did you read the news about its inflation? The government hasn't published any information related to it for 3 years and now claim its inflation is at 103,000%. IMF replied the percentage is a lot undervalued and the real rate is surely at 1,000,000% approximatively and will go up to 10 million. How crazy it is, see, printing more money and citizens now can't even buy a bread.

This is what happens when countries believe they can violate basic accounting principles, they believe that just because they are so big that they do not need to do it, but the truth is that they need to follow those principles like any other person would and the moment they begin to spend more money than what they get in taxes they get in trouble, while it is true that the low price of oil is a factor in the fall of Venezuela any economist knew it was just a matter of time before this happened.

Oh you mean this?


It's very likely that whoever was saving their monthly payment for the last years, this monthly payment is now worth about as much as a toilet paper.

I wonder if their banknotes are at least burning up well, they could use them to warm up on winters!
It's the common folks who pay for the stupidity or green of the few in the end.

[Mike Mayor]

All you need to do is look at what happened to Germany during WW2 and what happened to zimbabwe a few years ago. Maybe at first, it seems like a good idea until hyper inflation and then you trading a wheelbarrow full of money for some milk and bread.

I read the article and didn't see anyone compare this to cocaine or cannabis. Comparing printing money as being addictive as cocaine is ridiculous. Why listen to some fool who compares cannabis to cocaine in the first place.

[FanEagle]

The mathematics of constantly printing money is because the government usually has debts to pay and they fail to do so and there is literally no other way to pay the debt but print money. What you think as printing money is not depending on the amount or economics or that country but it is about the power of that country.

Just to give an example USA printed about 800 billion dollars just 10 years ago, literally 800 billion dollars which is more than most countries GDP but nothing major happened to them, hell most of the companies recovered thanks to it and now they are back to square one, the past decade helped them get better (nowadays they are getting worse because of trump but that is irrelevant).

So, you can print money as much as you want, you can print money at the height of 800 billion dollars and nothing would happen. Its not about printing money and nothing would come bad out of it if you are powerful enough, its about how weak your country is, when Venezuela does it then they get much worse but when USA does it everything is fine.

[SirLancelot]

When your economy is not doing well, the inflation is beyond control and the people are demanding for changes...what will you do? Of course, you will print billions and billions of paper money so you have the budget for anything you want and to solve many monetary problems your country is facing today and into the future. Now to make things spiced up and politically correct, you are going to call the printing of more money as "quantitative easing" a term pregnant with many possibilities, opportunities and threats depending on which of the equation you are located.

In an interesting article, the author likened this quantitative easing to an additive drug even more potent than the usual marijuana or cocaine you can buy on the street. And now, politicians and bureaucrat are getting addictive into it as their easy fix to solve myriad of problems.

Further Read: https://news.bitcoin.com/after-trillions-printed-under-qe-politicians-now-say-deficits-dont-matter/

We all know that eventually, printing of more money can result into disaster in the long-run. This is not like a chili pepper hot sauce that can immediately be felt but definitely this is like pawning the very future of the people.

I don't think any country in their right senses would be doing that kind of sh#tty stuffs, cause it's very bad is going to ruin their economy. What's the need of printing more money when you already know that it is going to cause the value of that currency to be dropping and all those money you have printed will just turn to become worthless and nothing else. Countries do print money and it can either be to renew the ones in circulation or for a good reasons. So don't think that anyone in their right mind would just be printing money anyhow.

[salty]

Disconnecting gold and paper money was the beginning of such practices so unless there is a real link to gold or any other real assets, we will see this problem but will vary from country to country.

Perhaps because of this problem, very smart people began to promote a new trend in the form of cryptocurrencies.Without gold peg, paper money simply does not cost anything. Cryptocurrency really can be an alternative to paper money.The current financial system requires an urgent change of the rules of the game.In addition to Venezuela, there are a number of countries with similar problems.

[desticy]

The more money is printed, the more they depreciate it called inflation. As a result, prices become higher, less money for something to buy due to higher prices, unemployment is rising, the government has to print more and more money to correct the situation. Vicious circle.

[Boh manok]

Indeed, printing money continuously can cause economic chaos in the country, by that government will never print money excessively because it can reduce the value of the money so that all food ingredients and so on will experience a massive increase, thus making  the community becomes troubled

[thehun]

Once an Argentinian friend told me: "if you want to be successful in Argentina, you save in USD and you take loans in Pesos". And he was doing quite well with this simple rule. Sure, he was relatively wealthy and in a position to apply this, but also some lower-middle class people took advantage of the rampant inflation by maxxing out their credit cards (in many places they were offering 0% loans if you purchased certain stuff) buying things with a value that doesn't depreciate, paying the instalments (the last ones were a lot easier to pay) and at the end reselling the item at its original value + inflation.

I have never seen so many highly creative people (financially speaking) as in Argentina. I guess they don't have a choice and grow up with these things.

[South Park]

snip

So, you can print money as much as you want, you can print money at the height of 800 billion dollars and nothing would happen. Its not about printing money and nothing would come bad out of it if you are powerful enough, its about how weak your country is, when Venezuela does it then they get much worse but when USA does it everything is fine.

Comparing the US against any country when it comes to printing money will always be unfair for one reason, the dollar is the reserve currency of the world so the US can get away with printing such huge amounts of money because of it, even if the economy of the US was as large but if the dollar did not had its reserve status then you could see the bad effects of printing money in a faster fashion, however that does not mean they can get away with it forever.

[TheUltraElite]

The more money is printed, the more they depreciate it called inflation. As a result, prices become higher, less money for something to buy due to higher prices, unemployment is rising, the government has to print more and more money to correct the situation. Vicious circle.

So what do you suggest should be done even though your opinion means nothing to your government? Ban all fiat money and issue some crypto that is deflationary?

Might seen pretty good to you but dont forget that not every person in the world is as wise as you are and you are literally going to be making it very risky for those who have little understanding of how to keep crypto safe. Moreover a crypto economy is not sustainable if there is no taxation system and if you ask crypto users to pay taxes then you are not going to get anything out of them because that was the only reason they moved to crypto.

[Argoo]

Paper money has existed for many centuries, and governments have long developed certain rules for their circulation in society, so that they benefit the state economy. They are generally very useful for any economy, however, as elsewhere, moderation is always needed. In terms of printing extra money, I do not see big problems. The government sometimes prints extra paper money, but it also knows that this can lead not only to big inflation, but also to the political death of this government.

[RivAngE]

Paper money has existed for many centuries, and governments have long developed certain rules for their circulation in society, so that they benefit the state economy. They are generally very useful for any economy, however, as elsewhere, moderation is always needed. In terms of printing extra money, I do not see big problems. The government sometimes prints extra paper money, but it also knows that this can lead not only to big inflation, but also to the political death of this government.

The thing is, that metals as a form of value for trading has existed for much longer than fiat paper.
Ofcourse we can't keep using physical metals in our age... I don't know how much gold one mobile case bought from ebay is but it'd probably cost more to transfer a tiny amount of gold to china than bringing in the case from there!

But Blockchain should be the next step that bridges the best of both worlds (the fairness of physical metals and the comfort of fiat transactions).
It doesn't have to be Bitcoin, just any well organized blockchain with fairness in mind would be great.