Re: Printing Money

[Bruce McFarling <brmcf@xxxxxxxxxxxxxx>]

But in a bank reserve based monetary system,
hyperinflation would still be from a credit creation
process, in this case the Government inducing the
Central Bank to create credit directly. The printing
of the money is still incidental to the process.
Is there an advanced industrial nation that
doesn't use some form of bank reserve based money?
There may be other mechanisms at work, of course,
in soft currency nations, especially where hard
currency reserves must be kept.

Virtually,

Bruce McFarling, Knoxville
brmcf@xxxxxxxxxxxxxx


On Fri, 24 Feb 1995, Alan G. Isaac wrote:

> On Thu, 23 Feb 1995 16:26:57 -0700 Jim Devine said:
> >But note that this hyperinflation is really caused by the
> >civil war, social conflicts, etc. rather than by the
> >printing of money.  The latter is just a symptom.
> >Similarly, strictures about the need to balance the government's
> >budget hardly solve the real problem.
>
> Would you agree that we can say the conflict etc. leads
> to a reliance of inflationary finance, which in turn
> generates the hyperinflation? The "printing of money"
> then remains a proximate cause of the hyperinflation.
>
> >
> >BTW, has any government ever dumped money from airplanes or
> >helicopters? Rumor has it that the Chaing kai-shek government
> >did this after WW II as it was losing the Chinese civil war.
> >(Of course, most money enters the economy through the banking
> >system rather than though the air force.)
>
> I heard a rumor that the US did this to Iraq during the Gulf War.
>
>
>
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