Why We Can't Simply Print More Money

So you're walking around a volcano minding your own business, when you trip over a bag labeled "Infinite Money". (I know, I'm not very good with examples.) You open it up, and find thousands of dollars in different currencies, after taking out a stack of the money, you find out that the sack replenishes itself. Do you take the bag and store it away for a rainy Friday, or do you toss it down the volcano? This article isn't a trick question with cliche answers such as possibly lose all your friends, or have people kill you. (Even though those are perfectly good reasons.) We're here to talk about actual things that are extremely likely to happen.

Here's a reminder of your mortality. Bam. Feel free to take a moment to reflect on life.

If you decide to take the money what's the worst that could happen right? You're not going to run around throwing cash around like dirt, you're just another everyday Joe with proper moral values. You won't be buying flashy cars and mansions full of gold bricks, you'll simply pay for the things that are needed around the house every weekend or so. What's the worst that can happen? You could destroy the world, that's what.

With infinite amount of currency, you can essentially destroy the world market, resulting in aftershocks of anarchy, confusion, and disorder. But how is that possible? How could having a barrel-load of cash possibly be bad for anyone? The money isn't hurting anyone, in fact, you could probably boost the economy by offering governments money for their plans and solve all the budget woes right? Throw a couple thousand bags filled with euros at the Obama, and all of the United States' problems would float away like clouds on a sunny day right?

"I don't know Sam, that's a lot of clouds."

Actually, no. Each penny you spend, or bring into existence, brings down the economy. As many of you may know, simply printing a picture with your face on it, doesn't give it market value. But why can you trade a couple hundred pieces of green paper for a flashy car with awesome lasers for headlights? Because behind the small piece of paper, is the physical aspect of a country's 'money' supply. The oil, gold and other valuables locked up in big rooms owned by the government gives the dollar it's value.

For explanation sake, let's pretend that the "valuable" is gold. The more gold the government has, the more your money is worth. The less gold the government has, the less your money is worked. However, it works the other way too. The more paper bills that says "One Hundred Dollars" there is, the less your money is worth. Let's pretend a dollar is worth a ounce of gold. There are 100 ounces of gold in the world, and there are 100 dollar bills in the world. If we decided to make another hundred dollar bills, the overall 'dollar' value would be half of before. Instead of getting a ounce of gold per dollar, you'll get half a ounce for a dollar. Do you see where this is going?

So how much is a sweet delicious pastry worth?

For that same reason, only the government is allowed to print money and make it "legal tender". It's the same reason we can't allow counterfeiters to run amuck town throwing money everywhere. Every time more money is being produced without the "resources" backing it up, the market value of the dollar goes down. If you had infinite currency, you could technically pull out trillions of dollars or euros, which would result in the value of the currency to drop. A hundred dollars could become a penny, and considering the amount of money people have, you could technically rob people straight from their bank accounts. People with a hundred dollars in their banks would have the equivalent of a few pennies of today's value. You would have the power to destroy countries.

You know who else has the power?

With a weapon to destroy global economies and governments, you probably wouldn't be able to cruise around first class to Hawaii without interruptions. You'll probably be sitting on the ocean floor before you get on the plane. So the next time you think, "Why doesn't the government simply print more money?" re-read this post. It's like they say, too much of a good thing is never good.