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Thread: What's wrong with this?

  1. #1
    Senior Member
    Join Date
    May 2002

    Question What's wrong with this?

    Would there be anything wrong with the government of the USA printing out a $1000 bill for every person in the country, and giving it to them. This would mean that every person could get something they wanted, all the businesses would benefit and surely it dosen't cost the government much to print one note per person.

    Is this true or not because I was just thinking about it one day and thought i'd ask you guys.
    \"Why is the bomb always gettin\' the last word?\" - Will Smith - Lost & Found (2005)

  2. #2
    haha... that'd seriously do some damage to the value of our currency for one thing I think... anyone know if this is for sure correct?? I mean... the value of our currency relies somewhat on exactly _how much of it is out there in circulation_... so... that would hurt I think more than help.
    Analog = Classical
    Digital = Techno

  3. #3
    Senior Member
    Join Date
    Nov 2002
    You are correct blakdeth77. If we increaser the money supply, two things happen
    1. Borrowing costs decrease and this investements increase
    2. Value of curreny decreases and those exports increase and imports decrease (we buy less from foreign countries and they buy more from us)
    I am not an economist, I simply looked it up in my Economics for Engineers book I got first year university (I never thought I'd open it again)
    Hope this helps!

  4. #4
    Senior Member gore's Avatar
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    Oct 2002
    this happened in i think germany a long long time ago, they printed enough money to pay off a debt and it totally screwed there economy, people were taking bags of money to get like, bread, if im not mistaken we use gold as our moneys back up.

  5. #5
    Senior Member
    Join Date
    Jul 2002
    It's called fiat money. It causes inflation. read history :-P

    EDIT: No Gore we don't back it with anything, at least since the establishment of the federal reserve bank.
    \"Now it\'s time to erase the story of our bogus fate. Our history as it\'s portrayed is just a recipe for hate!\"
    -Bad Religion

  6. #6
    Senior Member
    Join Date
    Jun 2002
    All three of you are correct, except for that last part by Gore about the US dollar being backed by gold. The dollar has been guaranteed by the Federal government since Nixon.

    10. The Nixon administration insisted it would not devalue the dollar in order to alter the equations, but as the circular dollar flow became chaotic in August 1971, a Democratic member of the House Ways&Means committee, Henry Reuss of Wisconsin, publicly proposed a devaluation. (His wife was a Ph.D. Keynesian economist.) He also recommended freeing the dollar from gold, predicting that if this happened, the price of gold would plummet to $7 an ounce. The most active Keynesian economist who promoted devaluation was Fred Bergsten, who argued that the dollar had to be cheapened against the yen in order to give us a trade advantage. A Democrat, Bergsten still is director of the Institute of International Economics in Washington and continues to argue the dollar is too weak against the yen. He remains a favorite of The New York Times Treasury reporters, although his model has produced more carnage around the world because of the support it gets from the big banks than all the misery of several wars. Bergsten had been Henry Kissinger’s chief economist at the National Security Council, until quitting with great liberal fanfare as an opponent of Nixon’s Vietnam tactics. Bergsten’s influence lingered on at Treasury with his fellow Democrat, John Connally, the Treasury Secretary, who became the most ardent supporter of dollar devaluation.

    11. With the Reuss statement hitting the papers, the crisis deepened, with private citizens hedging by selling dollars. On Sunday, August 15, Nixon and his advisors met at Camp David and agreed on a plan to "solve the crisis." It included a 13% devaluation against gold and a total closing of the gold window, which meant no central bank could get gold from the Treasury. As this was supposed to be temporary, until the crisis passed, the dollar was still as good as gold, but at $40 an ounce instead of $35. Germany was aghast, as it had trusted the United States when it bought the bonds the French would not trust. Now, instantly, they had a 13% capital loss on the bonds.

    Also some facts about US currency in circulation
    \"When I give food to the poor, they call me a saint. When I ask why the poor have no food, they call me a communist.\" -- Dom Helder Camara

  7. #7
    Senior Member SodaMoca5's Avatar
    Join Date
    Mar 2002
    Even if it could be done without monetary ramifications think about political ramifications.

    The following are some ficticious News Headlines:

    BUSH Announces Plans to Give Every American $1000 for Christmas so they can buy something nice for themselves. Money will be printed not taken from taxes.

    Forbes: $1000, What Can You Buy That's Nice With That

    Wall Street Journal: 10 Ways to Inflate Prices to Get the $1000 for Yourself

    Nation: Daschle Blasts Bush For Giving A Flat Gift. Poor Should Get $2000 and the Rich nothing. Notes that Congressmen and Senators are not subject to Poor/Rich categorization and will get the maximum allowed.

    Democrats ask constituents to give their $1000 to the Party so they can stop this kind of thing in the future.

    $1000 Fallout, Prices Rise So That Now People Need $1000 Each Month

    Gephardt Calls for a new Welfare Program to Give $1000 to everyone who came to rely on the gift given earlier

    Congress Passes the Office of 1K gifts. Now it costs $10,000 for Every $1000 given out.

    The Office of Homeland Security Discovers that Terrorist are receiving more funding from the Office of 1K gifts than from traditional sources.

    In an Attempt to reverse the problem Congress sends out a recall of all money given out.

    Bush calls Congress Indian Givers

    200,000 Declare Bankruptcy because they cannot give back the money they already spent.

    /end speculation

    If you don't think things like this could happen just look at the trouble stirred up by the tax refund.
    \"We are pressing through the sphincter of assholiness\"

  8. #8
    Senior Member
    Join Date
    Aug 2001
    Unfortunately, the number of mail carriers being mugged would be quite staggering!
    I\'d rather die on my feet than live my life on my knees.

    (Emiliano Zapata, a Mexican revolutionary in the early 1900s)

  9. #9
    Join Date
    Nov 2002

    this got me to thinking. we could rate the possibility of the economy crashing based on operating systems.

    as it is, the economy probably has the stability of somewhere between Win98 and Win2000. i think if $1000 bills were given to every american citizen, the economy would crash faster than WinME on a P133Mhz.

    what would have to be done for Linux-grade stability?
    i will shoot you so hard.

  10. #10
    Originally posted here by spyrul
    the economy would crash faster than WinME on a P133Mhz.

    Here'a another crazy idea. Instead of boosting the military budgey by millions how about spending some of that money on immunization against Anthrax and Smallpox for the general community?

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