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August 31, 2014

Homework Help: Geography

Posted by Jenessa on Tuesday, September 26, 2006 at 6:27pm.

If a country is in dire need, as in Africa for example, why can't that country's currency production be increased to pay for such things? Who decides how much the Canadian mint makes, and why can it not make money to meet provincial needs?


Unrestricted printing money without some form of bond issuance (borrowing) by the government is a recipe for hyperinflation. That is what is happening in Zimbabwe today, and what happened to Germany during the Weimar Republic. The national currency becomes worthless.

The canadaian Government, like the US, cannot just "make" money without issuing some debt instruments or retiring old currecny from circulation.

One legitimate way to increase the amount of demand deposits ("cash"" in circulation is to lower interest rates and also flower the fraction that banks have to hold in Rederal Reserve accounts. Then it is the banks that increase the money supply, by opening checking accounts and paying checks written for borrowers.





First, Africa is a continent, made up of many different countries with different currencies.

It sounds like you believe that just printing or coining more money will solve a country's financial problems. It does not work that way. However, since I am not an economist, I cannot explain why.

As far as Canada is concerned, especially since this is not my area of expertise, I searched Google under the key words "Canada mint production" and "'Canadian mint' production" to get these possible sources:

(Broken Link Removed)
(Broken Link Removed)
http://en.wikipedia.org/wiki/Royal_Canadian_Mint
http://en.wikipedia.org/wiki/Canadian_coinage

I hope this helps. Thanks for asking.

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