why don’t the government print money money whenever the economy of the country is terrible and the citizens are starving?
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why don’t the government print money money whenever the economy of the country is terrible and the citizens are starving?
If everyone suddenly starts walking around with millions in their pockets, money will lose its value and business owners will react by jacking their prices up as they notice that everyone is now more than willing to spend more money due to having more cash. When you print money and give it to the poor, you are redistributing wealth but at the same time causing prices to go up due to the plenty money in circulation.
If government prints more money,then people will gain more money and buy more products and services. It will increase the demand of products and services which will lead to increase in price of goods and services. As a result of which monetary inflation will increase and the value of that country’s currency will depreciate.