As a result, we can see this example does even not fit into the same discussion of printing more money. Money is not even involved in this equation. Therefore, the increase from 2 to 10 bananas actually multiples the value in that economy by 5. Bananas have value and utility - they are food. This argument misses the mark completely. One that stood out to me was: “Monkey has 2 bananas, then monkey gets 10 bananas. On social media, many responses to people asking why we can’t just print more money have gone viral, and unfortunately tend to be condescending in nature. Addressing a common response to this questionįirst, I think it is important to unlearn the incorrect answer to this question, in order to then properly learn that proper answer. There are deeper layers that address how and why this system came into place this topic is interesting, but for the sake of this article, these details detract from the discussion at hand. In summary: the value of a good is constant (independent of the supply of money), and the cost that is associated with it is a reflection of the current supply of money. Now, let’s consider what happens of the supply of money changes: the prices will change proportionately to the change in supply (prices will increase or decrease with the supply of money), but the 1:10000 value ratio of gum to a car remains constant. The cost of any good is determined by market forces, but in a general sense it represents the value of that good relative to our current supply of money.įor example, a pack of gum for $2 is 1/10000 the value of a $20000 car. Put simply, money represents that value of goods we have. It is first important to understand what money is, in order to appreciate why printing more of it would not solve any problems related to poverty. There are always deeper layers, but for the sake of this article I will be maintaining a mostly high-level explanation. I do not intend to delve into compl ex economic topics - this would just confuse the situation. In this article, I seek to answer this question, rebut common responses to this question, and in the process explain what money truly represents. This question, as indicated in the title, asks why we can’t just print more money and give it to people in need. I want to settle a discussion that I have been seeing everywhere across social media and social circles alike.