Saturday, February 2, 2013

Economics 101 – Excess Money Equals Inflation

The government can print money. So why don’t they simply print more and then give it away to everyone? Certainly this would alleviate poverty and stimulate the economy. Within modern economic societies money is used so intensely, that many times people forget what money really is and why we use it.


Why was money invented?

Before money came along, people got what they wanted by trading things between one another so in the end both people would receive what they wanted. Economists call this method of exchange or the barter system. Bartering however was a very inefficient system because you had to seek out someone who had what you wanted…


 

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