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EnglishWhat is the correct formula that can tell that you can print an X amount of money since you have good productivity on items and services without weakening the national currency.

For the last 2 years governments around the world were printing currency. This lead to high inflation on prices for everything. What is the correct formula that can tell that you can print this year an X amount of money since you have good productivity on items and services without weakening the currency. Any formula or thoughts on this?

PANAGOT 1 year ago
    Tags:
  • Economy
  • Inflation
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Ahmed 1 year ago
If the productivity of an economy is fixed but the supply of currency decreases, then each unit of remaining currency must store greater value
Aiman 1 year ago
you'd find no "formula" as such. but, one factor that tells the government of a country how much money they can print without increasing the inflation is the "raw wealth" of that country; e.g. the amount of Gold that country owns.
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Ethan Scheffel 5 months ago
GDP growth rate - A country's GDP growth provides a rough estimate of how much additional economic activity and transactions are occurring that may require money supply growth. Printing money too far above GDP growth risks devaluation.
Inflation rate targets - Most central banks target annual inflation around 2-3%. Printing money to chase GDP growth, but missing inflation targets, can risk long-term currency weakening.
Money velocity - The rate at which money circulates through economic transactions. Higher velocity allows the same money supply to support more transactions without devaluation.
Output gap - The difference between actual GDP and estimated potential GDP. A large output gap (underperforming economy) may necessitate boosting money supply to drive growth.
Interest rates - Lower interest rates make money more available for economic expansion, reducing immediate need for more money printing.
Money demand - Factors like population, income, and technological shifts drive legitimate demand for money over time. Some money printing is needed to meet higher demand.
Tools beyond printing - A central bank can use additional tools like adjusting reserve requirements or interest rates to help spur growth besides just printing money.
Muhammad 1 year ago
Productivity will increase if less currencies are printed
RichTobin 10 months ago
Do you have much experience about digital currency trading?
Akinola moyo 1 year ago
Printing extra notes must be followed by increase in production and increase in economic activity
Jimmy 1 year ago
Why printing money usually causes inflation. In normal circumstance (e.g. no shut down, most people employed) if you print more money and the number of goods remains the same, we will get higher prices. Because consumers have more money they want to buy more goods.
Maryam 1 year ago Correct
you'd find no "formula" as such. but, one factor that tells the government of a country how much money they can print without increasing the inflation is the "raw wealth" of that country; e.g. the amount of Gold that country owns.
PANAGOT 1 year ago
I see. Thanks :)
waseem bai 1 year ago
x = per year profit turnover - per year loss
if x is negative then print upto loss amount
Jess 1 year ago
I think the illusion we create for this is exactly that an illusion. It's hard to estimate with unknown forces like human nature, over population, disease, bacteria, infections. Then natural Forces of the planet such as fires earthquakes, and large storms. All extremely hard to estimate?
Muhammad zeb 1 year ago
An exchange rate is how much it costs to exchange one currency for another. Exchange rates fluctuate constantly throughout the week as currencies are actively traded. This pushes the price up and down, similar to other assets such as gold or stocks. The market price of a currency—how many U.S. dollars it takes to buy a Canadian dollar for example—is different than the rate you will receive from your bank when you exchange currency. It is often a key element of financial trilemmas. Here's how exchange rates work, and how to figure out if you are getting a good deal.
Mohsen Rezaei Barzani 1 year ago
The government has financial support in dollars in the central bank
And in my opinion, the government can generate money with half of that support and help production with the other half and It will has current assets by exporting the country's resources.