why the state does not print a lot of money? than debt to other countries. is not it easier to make money than debt and ultimately burdens the state?
whether if printing money will have an impact on the money itself? or will it impact the value of the money in the eyes of the world?
You would have had the answer to this question had you been a part of Economics - 101! So I will explain the principle behind that.
Suppose a country prints out lots and lots of money. Now this money is supposed to be distributed to every person of the country.
Up until now their total income was say 10,000$ a month and they were able to manage their household expenses and save a little bit out of it. Now, they will have more in hand, let's say 15000$. That extra 5000$ is over and above their expenses and savings. So these people would now go outside and spend this money on luxury items. Same would happen for every household out there, and hence, this would result in increase in the price of the luxury items and hence inflation of every such product.
Hence, a country has to keep the printing in check. The more money it prints, the more inflation it causes.
good explanation, actually inflation will be dangerous once it crossed boarders of each country, every country has a monetary reserves, they can only print based on how many funds they have, printing beyond their reserves will result to a destabilized economy, more buying powers will decrease supplies, so countries will rely on importation but since their money once converted to foreign currencies will be undervalued, it will cost them more but will acquire products less. take a look at a dollar is equal to 45 pesos, it is a clear inflation though manageable, it is still a sign that your currency is undervalued.
