|
-
May 7th, 2000, 06:48 AM
#3
Frenzied Member
as Far as I know that's not quite right, countries are very carefull not just to print money, in theory the total amount of currency a country has is equal to the value of it's gold reserves, ie if the amount of gold in the bank of England is £V then there should be exactly V Pounds Sterling in the world. You can at any time march into the bank of england with your 10p coin and demand 10 pence worth of gold.
The reason for inflation is that people are greedy, If I'm slaving away working for a supermarket and demand a pay rise then to pay for that payrise the supermarket has to raise it's prices slightly, then I decide I want a payrise again because I still need to pay for all the stuff I need. This pushes prices up again and the whole process starts again.
suddenly my 10p worth of gold which used to buy me a packet of crisps(chips) will only buy me half a packet of crisps, The crisps arn't any more valuble, the gold isn't any less valuable so we have to change what the currency is worth, so my 10p isn't worth 4g of gold any more, it's only worth 2g. To balance this out the bank prints more money.
Posting Permissions
- You may not post new threads
- You may not post replies
- You may not post attachments
- You may not edit your posts
-
Forum Rules
|
Click Here to Expand Forum to Full Width
|