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    Many of you will claim to know economics having studied it at AS or A level, and what I am about to write of may seem a stupid idea and you'll instantly throw me down; don't, because unless you have a full degree in economics, I don't think you can fully appreciate my logic here.

    By printing money we would have more money to recapitalise the banks and pay off our debts; ofcourse doing all of the public debt this way would be disasterous, so lets take a figure of 20% of £1 trillion and pay this off there and then using electronic money. Many of you would be quaking in your seats saying no! no! hyperinflation!

    Hyperinflation only occurs when there is too much money circulating in the economy, but at the moment the sole problem with the economy is the circulation of money. Money is often being hoarded by companies and offshore investors, and is sitting there doing nothing, infact some economists suggest the majority of british pounds are doing this. What does this mean? It means that if we payed off that 20%, we would not have hyperinflation, because the money would not circulate in the economy, it would simply be hoarded by offshore accounts. Effectively, the only people we would be screwing over by doing this would be those who are not spending money; those that are will get the instant purchasing power, whilst others would see their savings decline in purchasing power.

    Ofcourse, it would take a while for inflation to kick in, and the effect would only be noticed slowly, as confidence in the economy is low; thus those private investors and offshore accounts who have all that money of ours would be skeptical still to invest, and prefer to sit on their declining purchasing power than gamble it all in the British economy. Ofcourse, if they do this would be good for the economy but would lead to inevitable inflation. As confidence picks up, gradually inflation would increase; at this point government spending would have to be decreased (paying off more of that deficit) and printing money would have to effectively cease.


    To avoid trolls or skepticists, I'm going to put down here that I do PPE at Oxford.
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    (Original post by Melthusa)
    Many of you will claim to know economics having studied it at AS or A level, and what I am about to write of may seem a stupid idea and you'll instantly throw me down; don't, because unless you have a full degree in economics, I don't think you can fully appreciate my logic here.

    By printing money we would have more money to recapitalise the banks and pay off our debts; ofcourse doing all of the public debt this way would be disasterous, so lets take a figure of 20% of £1 trillion and pay this off there and then using electronic money. Many of you would be quaking in your seats saying no! no! hyperinflation!

    Hyperinflation only occurs when there is too much money circulating in the economy, but at the moment the sole problem with the economy is the circulation of money. Money is often being hoarded by companies and offshore investors, and is sitting there doing nothing, infact some economists suggest the majority of british pounds are doing this. What does this mean? It means that if we payed off that 20%, we would not have hyperinflation, because the money would not circulate in the economy, it would simply be hoarded by offshore accounts. Effectively, the only people we would be screwing over by doing this would be those who are not spending money; those that are will get the instant purchasing power, whilst others would see their savings decline in purchasing power.

    Ofcourse, it would take a while for inflation to kick in, and the effect would only be noticed slowly, as confidence in the economy is low; thus those private investors and offshore accounts who have all that money of ours would be skeptical still to invest, and prefer to sit on their declining purchasing power than gamble it all in the British economy. Ofcourse, if they do this would be good for the economy but would lead to inevitable inflation. As confidence picks up, gradually inflation would increase; at this point government spending would have to be decreased (paying off more of that deficit) and printing money would have to effectively cease.


    To avoid trolls or skepticists, I'm going to put down here that I do PPE at Oxford.
    So you actually don't know anything about economics then.

    :lol:
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    Printing money lowers the value of all the rest of the money in the system, otherwise called inflation. You would not be able to pay off national debts because the interest on them rises alongside that inflation; you would only be de-valuing the worth of the currency.
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    (Original post by danny111)
    So you actually don't know anything about economics then.

    :lol:
    Why would you think that? :holmes:
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    (Original post by Abiraleft)
    Why would you think that? :holmes:
    PPE at Oxford? I was teasing.
 
 
 
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