Why don’t all of the government departments go to central banks and demand they print more (or they would make us all more money in the first place)?
It’s the answer to the puzzle that has been holding the world hostage (pun intended) for the last decade.
The world economy is running very close to maximum capacity (maximum money printing). In effect, a world-wide glut of money (too damn much). There is one solution. A small rise in the exchange rate, or a smaller rise in the value of a currency (in terms of dollars).
So what will happen next time the big money printers want more? Why don’t they just do it (as long as the price of the US Dollar, dollar-dollar market, is still higher on paper than in the physical economy) and use the proceeds? Let us see!
This is in fact one of those simple ideas that has been making the rounds for years.
I see this happening in countries all over the world. The only big problem is that it looks as if there is a war going on. As if the currency authorities are being forced to take their measures (and take their actions by the threat of force), and not the other way around.
If the money authorities have to choose between printing money and accepting a recession that might be coming, they will choose the latter. It is not a coincidence that their decisions are always made “on their terms”.
Just to show the magnitude of the problem: The value of the dollar has fallen by a third since June of last year. The real value of the dollar is falling by around 1.25% a year in dollar terms. This is in addition to the decline in the stock market over the same period. This represents the loss of 5% yearly real growth, just in the past year. This implies an economic recession worth hundreds of billions of dollars in losses every year.
How does this affect your savings and money? Just imagine the day when the price of the dollar is about 0.50, or 1.00. The dollar will go down to 0.50, or 1.00, and still you’ve got a dollar. That’s 3.5% annual inflation. You can now live on just 5% of your income (if you do nothing).
That’s not all. This is also a major destabilizing factor: People are going to quit the economy on a dime as they realize this is not going to work out as
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