When a whole country tries to get richer by printing more money, it rarely works. Because if everyone has more money, prices go up instead. And people find they need more and more money to buy the same amount of goods.

This happened recently in Zimbabwe, in Africa, and in Venezuela, in South America, when these countries printed more money to try to make their economies grow.

As the printing presses sped up, prices rose faster, until these countries started to suffer from something called “hyperinflation”. That’s when prices rise by an amazing amount in a year.

When Zimbabwe was hit by hyperinflation, in 2008, prices rose as much as 231,000,000% in a single year. Imagine, a sweet which cost one Zimbabwe dollar before the inflation would have cost 231m Zimbabwean dollars a year later.

This amount of paper would probably be worth more than the banknotes printed on it.


RISING PRICES

To get richer, a country has to make and sell more things – whether goods or services. This makes it safe to print more money, so that people can buy those extra things.

If a country prints more money without making more things, then prices just go up.

At the moment, there is one country that can get richer by printing more money, and that’s the United States. This is because most of the valuable things that countries around the world buy and sell to one another, including gold and oil, are priced in US dollars.

TC - The Curious Kid

THE DISMAL SCIENCE

But it’s not true that a country can never get richer by printing money. This can happen, if it doesn’t have enough money to start with. If there’s a shortage of money, businesses can’t sell enough, or pay all their workers. People can’t even borrow money from banks, because they don’t have enough either.

In this case, printing more money lets people spend more, which lets companies produce more, so there are more things to buy as well as more money to buy them with.

Too little money makes prices fall, which is bad. But printing more money, when there isn’t more production, makes prices rise, which can be just as bad. No wonder economics – the study of money, trade and business – is often called the “dismal science”.

God bless America
God bless Nigeria
God bless me and my family

Very true. CBN buys more Naira with US dollars in order to control inflation and strengthen the Naira.
The same applies to cryptocurrencies. Binance buys its own token (BNB), and destroy it in order to increase its value.
It's all about demand and supply. One would have thought that the price of gold and crude oil will keep rising since they are discrete in quantity. Unfortunately, this isn't always so because they may not be in demand forever, unlike land.

The dismal science indeed.....Almost everything revolves around the dollar.....

You're right But the section you post this isn't right

Burgerlomo:
God bless America
God bless Nigeria
God bless me and my family

All d oil nd agriculture we av nko...is dah nor God blessings?? Wat av we done wit it.

God bless ur Family
God bless America

Nigeria is useless nd av squandered all d blessings God gave dem so dey will suffer for it.

chinchonglee:


All d oil nd agriculture we av nko...is dah nor God blessings?? Wat av we done wit it.

God bless ur Family
God bless America

Nigeria is useless nd av squandered all d blessings God gave dem so dey will suffer for it.

Bitter truth