If money can be printed why do our government borrows money from other country?

[Synchronice]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

Is that right or they are trying to maintain economic value?
What do you think?

It's crazy how some people think that printing money actually does something. Who wants your paper if it doesn't hold a value? Any country can print unlimited amount of money but that will only lower the purchasing power of the country's currency. When you borrow money from another country, like from the USA for example, you are getting actual economic value that already exists and it doesn't devalue your currency, instead, it increases the purchasing power, depends on the amount of the money that you borrowed. Currencies aren't equal. USD is superior compared to many currencies in the world. Printing USD is very different compared to printing Ruble. USD is the global currency and when printed excessively, it not only affects the USA but the whole world while Ruble's excessive printing will only affect Russia and maybe some of its allies.

[Call_Me_Guru]

Is that right or they are trying to maintain economic value?
What do you think?

You got it all wrong from the start, which could cause you to think like this. Money owned is different from Power and Accessibility. Countries may have the Power but lack the Accessibility. Take banks for instance, they might have access to a rich man's money, but without his permission in terms of loan or other investments, they do not have the authority to use it. That is how the economics and finances of nations also work. You might believe they can print money as they like, but there are procedures, the money must first be theirs and the policies on ground must be able to accommodate it before they print it. If not, they will also print the country into troubles of inflation, unemployment and other economic uncertainties.

If you take note, two key points are there: The country's asset and Policy. These two shapes the landscape in this discussion and no country can behave irrationally with them. You can't use the money you don't have as individual, the same is applicable to countries. That is why they borrow, they don't have it, or have enough. Even if they have the collateral, countries commitments sometimes make them overwhelmed and need to borrow.

[colinistheman]

Who told you that countries can print Money uncontrollably, that is not true, currency is bond and for anyone that is ever printed there must corresponding bond that is tied to, governments can't go about just printing unlimited money, it doesn't work that way, if not there will definitely be high uncontrollable inflation where money won't have any value, just like it did in Egypt of the olden day's.

It is incorrect to say that the government can print money without control. But it is also incorrect to say that every time a unit of money is printed, there must be a corresponding bond tied to it. A practical example is that in every crisis, they can print money massively to save the economy without immediately issuing more bond. Such as during the Covid, Fed and many other central bank printed trillion of dollars and injected them into the market without issuing bonds or relying on any rigid form of backing.

[SquallLeonhart]

They do not really "borrow", they just switch hands, because every nation does, and that means A borrows from B and B borrows from C and C borrows from A and that way they create wealth without actually printing money all thanks to IOU type of transactions. Plus if you just print alone, then you are going to cause inflation, whereas if you just borrow then it is debt to pay later but doesn't cause any inflation.

This way you keep your currency strong, but have a debt instead. Imagine if you could have the same power, where your salary increases a lot, but you can't really pay for anything new, it's the same things you can buy with higher salary, would you accept that? What is the purpose of having a higher salary if I can afford the same things?

[Agbamoni]

I dont know much about this topic. However, I've asked myself several times how printing money works without a good conclusion.

The best guess is that this money cannot be printed uncontrollably because it has a cap that must not be surpassed in a single year. Like for a year, an X amount can be printe,d but it shouldn't be more than that, if not it will cause for inflation. Instead of printing more money, the country goes about taking debt, which they think can be paid after foreign trades, and through other means of services to provide within and outside the country.

[Oluwa-btc]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

There's how one needs to understand the concept of money and how it works, this thought will always creep into the minds of individuals but a thorough research on it and knowledge would let the cat out of the bag. Every country are always indebted to another in one way or the other and the more reason printing of money can't be in process cause it'll lead to devaluation of the currency that's why a country can borrow from another.

[Odusko]

Who told you that countries can print Money uncontrollably, that is not true, currency is bond and for anyone that is ever printed there must corresponding bond that is tied to, governments can't go about just printing unlimited money, it doesn't work that way, if not there will definitely be high uncontrollable inflation where money won't have any value, just like it did in Egypt of the olden day's.

It is incorrect to say that the government can print money without control. But it is also incorrect to say that every time a unit of money is printed, there must be a corresponding bond tied to it. A practical example is that in every crisis, they can print money massively to save the economy without immediately issuing more bond. Such as during the Covid, Fed and many other central bank printed trillion of dollars and injected them into the market without issuing bonds or relying on any rigid form of backing.

You are quite right there are what it call emergency fiscal funding and this could be what you referred to as COVID relieve fund's that was shared between various nations, and that what we can point to as the massive money printing regime which has been on record.

[snowpega]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

Is that right or they are trying to maintain economic value?
What do you think?

A country can only print the money according to the reserve condition they are holding at the backup. If the country starts to print more money, the currency will start to lose its value against other currencies, and at the same time, the rate of inflation will start to increase badly. Other than this, according to the best knowledge I have is that countries do not print their own currency in their own country because their money printing machines are installed somewhere else in other countries.

Other than this, the answer to your second question, why countries borrow money from other countries, is because they might have some plans to execute, and for that they need more money that they surely don't have, and for that they borrow money from other countries that they surely have to return, including interest on the specific set time or date. Other than this, if any country denies giving that money, then countries can request the IMF for getting a loan. And if the IMF approves that request, then that country uses that money to execute its desired plan.

[Iroh]

Any country is actually free to print as much fiat as you want to. But then, actions beget consequences. If a country goes ahead to print in excess and flood their economy with fiat currency, the money in circulation would be uncontrolled and so much, it starts to rapidly lose its value.
One of the characteristics of money is scarcity. Money ought to be somewhat scarce to retain some sort of value and when it's everywhere and easily gotten, it naturally loses its value. So, print away at your own peril.

A country that has first hand experience on hyperinflation due to excessive printing of fiat is Zimbabwe. They printed so much money, smaller notes became pretty much useless and they resorted to printing higher denominations on a single note. It got so bad they once had a 100 million Zimbabwean dollar banknote. Crazy times.

[Sulegzy39]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

Is that right or they are trying to maintain economic value?
What do you think?

Reasons why our government borrow money from other countries, is when budget is to much and we have limit of printing money every year, instead for them to printed more money the country goes around taking debt. Whereas if you just borrow them it is debt to pay later doesn’t cause any inflation. Some of our politicians today only knows there pockets forget poor ones, they will give some of them project to offer in their community and they will not.


That’s how the economics and finance of nation also works. you might believe they can print money they like which would cause you to think like this. Money owned is different from power and accessibility.if the country starts to print more money,the currency will start to lose its value against other currencies.

[Aloysius01]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

Is that right or they are trying to maintain economic value?
What do you think?

Yes, countries can print money but they can't do it endlessly without consequences, printing money too much leads to inflation, currency devaluation, loss of confidence and sometimes full economic collapse we have seen this with zimbabwe, Venezuela, etc.
So why borrow instead of printing?
Printing money weakens the currency, if a country prints too much prices rise, savings lose value and people lose trust inthe money.
Foreign borrowing brings in hard money, loans from countries like china are usually in dollars or other strong currencies which are needed for imports, infrastructure and debt servicing.
Borrowing signals discipline, at least on paper, creditors impose conditions that force governments to control spending, something printing money doesn't do.
Global system pressure, many countries are locked into the IMF/world Bank system, where borrowing is normalized and printing freely is discouraged, That said borrowing can also be abused when loans are mismanaged or stolen, the country ends up indebted with nothing to show for it which is the real problem many developing nations face.
So yes part of it is about maintaining economic value, but part of it is also politics, power and dependency, This is one reason Bitcoin appeals to many people, it removes the ability to print money at will and forces discipline by design.

[7juju]

The more money you have in circulation the more your currency losses value in the international market, that's why the government don't just print more money whenever they need more. Each money printed has a number, with those numbers the total money your country has ever printed is known and monitored. The higher the printed money that's how the inflation in your country will be higher. To avoid this scenario, government resolves into borrowing and pay from money they generate from taxes and other means. So that they can preserve the value of their national currency.

[LOVER BOY 422]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

Is that right or they are trying to maintain economic value?
What do you think?

The more reasons why the government didn't print money on their own use is that the central bank has their watch dogs in all the central bank ,when the printing of money they ask that's central bank ,that' is the amount they will print but printing money without the permission of central bank of Nigeria it will not work ,this is exactly what happened in many countries that make them to suffer from inflation their things will be so costly even to buy is problem yet their president was arrested,but things are also cost in Nigeria by but they didn't print money it was checked and recorded that the numbers of money asked from the central bank was the exact amount that was printed,but why is things still course in this country,in my conclusion note  that the  central bank of Nigeria has target of money that should be printed.

And if anyone print as many as it was not asked the problem of the person has just started completely.so it is very wrong for central bank to print money without proper proofs.

[Ndabagi01]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

Is that right or they are trying to maintain economic value?
What do you think?

Borrowing money is not the best solution and also printing a lot of money is very bad. But the real problem is mismanagement of borrowed funds by weak institutions, corruptions and no good productivity. If every country wants to print money since they don’t want to borrow, this leads to inflation, no real value and prices of goods skyrockets. Borrowing looks like a better option but when borrowed funds are not managed well, it leads to economic slavery in the sense that projects don’t generate value, corruption eat the most part of the funds. Printing money aimlessly is not good for a good economic condition of a country. A perfect example of such case if the Venezuela and Zimbabwe case.

[uchegod-21]

@op, have you thought of the dangers of having excess money in circulation?
Firstly, there will be inflation, very rapid inflation
Secondly,  because of the excess money as a result of excess printing, exchange rate will get weak
Thirdly, purchasing power will drop drastically
Lastly, the currency will have no value. Same people who want the government to print more money will dump their local currencies for stronger currencies, or even fall back to gold or Bitcoin.

I used to think this way as a child, but now I understand clearly that borrowing can also be a government economic strategy. That is if used well.

[passwordnow]

I used to think this way as a child, but now I understand clearly that borrowing can also be a government economic strategy. That is if used well.

I also thought of that when I was zero knowledge about how economy works. I thought that borrowing is a bad thing but that's a way to at least fund some good infrastructure and programs that the government is about to do. But not all borrowing is good especially if the country is already in debt. And that's why those countries that have less to no debt(if there is) are having a good signs that they're healthy economically and they're stable compared to the ones that have been borrowing because they have to give favor to the lender in any way they can.

[HelliumZ]

I am still shocked to know that even when money can be printed as much as possible, countries, nations goes after each others to borrow money but yet they can on their own print money instead of having to go borrow and leaving the nation indebted other nations. Just as for instance our country do borrows money from China.

Is that right or they are trying to maintain economic value?
What do you think?

Yes, the government has ample opportunity to print money to deal with foreign debt or the country's crisis, but that would be more likely to cause harm than benefit for a government. Therefore, the government, despite having ample opportunities, cannot solve the problem by printing paper money. Printing paper money will increase the country's inflation rate, which will result in a decrease in the value of the country's local currency. That is why the government increases the amount of foreign debt by not printing paper money, despite having ample opportunities.