Why Don’t Poor Countries Print Money Just Like US Has Done To Finance Their Debts?
If any country over prints there money, it just lowers the value of the currency. Aka say your a very small country and only have 1 million dollars made. If there are 1,000 people in your country then the rate of what each value is worth depends on how much everyone makes. In us its like this, a loaf of bread is $1 so almost everyone can buy it to live on. The higher ups can buy premium loafs for $4+ a loaf. Now, if your in debt you need to pay it off, and say you owe me two dollars and you only have one. You got print one more off to give me. Because of that action, more money is around, so now the 2 dollars is only worth 1 still and to pay off your debts you must give me $4.
Printing money is not an option to pay your debts away.It is like you owe me $10 but you have only $5 with you.You print the other $5 and give me $10.This is not right you have not earned it from anywhere you have done nothing to help that $5 to come to the market.The $5 has no value in the market so that $10 is only $5 in the market and hence the value of currencies go down with mindless printing.One example is Zimbabwae.Am I right ?
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