How are dollars backed by the US government? Can the US government simply print more currency?
Thіѕ bailout іѕ going tο send thе US government іntο a deficit іn thе billions. Iѕ thе US government nοt іn control οf US currency? Cаn’t thеу print more dollars? I know thаt thе gold іn Fort Knox іѕ nοt sufficient tο back аll currency іn circulation. Hοw еlѕе іѕ thіѕ mighty dollar backed?
Nothing and Yes. But why worry about deficit now? Bush left us with a HUGE deficit. The only problem with the deficit which our Li’l Bush criminal left us with bought us exactly nothing. Really Bush’s deficit bought us a war in Iraq and Afghanistan which may by no means end.
So yes – we’re going to add to this deficit – but we’re also going to rebuild the roads, powerlines and power plants. Bush by no means build a road or a sea wall or a power station or a power line – the cash is just gone – gone into the pockets of his Super Rich friends.
And don’t you wish YOU were Bush’s rich friend? But if you went near Li’l Bush he’d have you shot like a dog. That’s why he invented Blackwater.
Printing more US currency is an option, but it’s more like a last-ditch plot.
You by no means want to print more cash.
Printing more cash would decrease the value of the dollar.
Inflation would space rocket.
Take what happened to Germany for an model.
The US government can easily print more dollars. As the gold standard has been already abandoned in 1970s, there is no condition for backing all the currency issued.
But printing more dollars will decrease the purchasing power of dollars. The exchange rate of US dollar will plunge downwards. The confidence which other countries have on US dollar will also fade away. So excessive printing will as a replacement for terribly effect the economy through higher inflation.