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June 11, 2010

Printing Press Insanity, A Money Creation Story

As in today’s video and a few other interviews, an increasing number of “experts” have come forward to push the theory that printing money will solve our economic problems.  While many may argue that we are already printing money (by issuing debt and having the Federal Reserve buy the debt back), these people are arguing the cutting out of debt issuance.
Governments can overtly print money without the populace finding out.  Our federal system of “interdepartmental” debt and complex government accounting can cover up hundreds of billions in new paper money.  Who would hold the government accountable for doing such a thing?  Additionally, as we have learned from entitlement programs, once the government starts, we will become fully dependent upon the printing press.
Furthermore, the printing press will devalue our currency and cause inflation.  Two good articles and illustrations regarding the printing of money can be found here and here.  What baffles me about this concept is why anyone would find printing money a remotely good idea.  I believe this is a consequence of our society’s lack of education and information when it comes to economics.
If anyone in the readership defends or believes that printing money is a good idea, can I please see examples of where it has worked in the past?  I have been looking and cannot find a single instance.

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