Why don’t countries print money to eliminate poverty ?
You never had a question of why the state does not print enough money to solve the problem of the poor? especially since the state prints money, and the cost of printing that the state bears in order to print money is considered low, so why does the state not produce money in an amount that helps in the elimination of poverty?
it may seem The matter is that simple for the general public, but if the state prints a large and huge amount of money, this matter will destroy its economic sector.
SO Why don’t countries print money to eliminate poverty?
The illogical, non-scientific interpretation
Imagine that the society in which you live has become all rich and no one needs to work in order to obtain money, how can each person thus meet his needs, from where will we get food, drink and clothing without the presence of workers trying to provide those needs for other people With the purpose of making money.
Accurate scientific explanation
If the process of printing money is not controlled and studied, the state will enter into a phenomenon called inflation, and if the state prints huge sums of money without using it, this will lead to runaway inflation. To bring the matter closer to us, imagine that you live in a country where prices increase at a rate of 50% per month, and the level of increase may reach 1300% per year, and prices may increase in unbelievable numbers, so what can you do in light of this mythical increase! Countries have suffered from inflation
Several countries witnessed the phenomenon of hyperinflation
namely: Chile, China, Argentina, Greece, Yugoslavia and Zimbabwe, where at one time the price of one egg in Zimbabwe reached billions !!. How does the state calculate how much money it has to print?
The central bank used to print currencies equivalent to the value of the gold that it held, but now that system is not applied, so what the central bank keeps in our time goes beyond gold, as there are hard currencies, bonds, and other properties. In the past, these properties served as a cover for the issuance of any currency, but countries can now exceed that cover fabulously, so that the currency derives its value through the status of the state, its size and the size of its economy among other countries.
The US central bank does not own gold, bonds, or currencies equal to the value of the $ 100 note. The state can know the size of the money that it can print in order to print the appropriate amount, neither a larger quantity nor a lesser quantity than is assumed, and thus the state succeeds in preserving the value of its currency among other currencies. It does not fall under that pain for the state to print new money to replace the damaged money that is not usable, as this does not cause inflation or anything else.