The Government’s Unfettered Printing of Fiat Currency Devalues our Dollar

Amid financial turmoil constantly looming over global economies today and with poverty being a constant threat to the living conditions of people all over the world, some people might ask, “why can’t the government just print money to solve economic problems?”

However, the government’s unfettered printing of fiat currency devalues our dollar. Pumping extra money into the economy won’t magically pay off national debt nor will it cure poverty. In fact, it can create more problems than you’d think.

Printing More Money Does Not Create More Wealth

The answer to the question of why governments can’t just print more money is simple: it just creates more money but it does not create more wealth for the people and the economy at large. Remember that money is only a medium of exchange and does not equate to wealth. Most countries today use fiat money or currencies that are not backed by an actual commodity like gold, silver, or precious jewels.

However, printing more fiat money does three things: it increases the money supply, it increases spending and increases demand for products. While more people will want to buy more goods, if production does not keep up then there will be problems down the line. If supply does not meet demand then the producers can and will increase prices (because everyone can afford it anyway). This means people now need more money to purchase goods than they used to which causes inflation and reduces the value of dollars.

Hyperinflation: The Case of Germany and Venezuela May need to mention Venezuela as not below)

While a moderate pace of inflation signals healthy economic progress and expansion, when left unchecked, excessive printing of fiat money can lead to hyperinflation and eventually economic collapse.

This happened in Germany as a result of their loss during World War I. The central bank had to print more money and loaned it to the government so Germany could pay for war reparations which caused hyperinflation with the exchange rate by the end of 1923 at 4 billion marks per dollar. The currency they used lost so much of its value that people had to carry wheelbarrows of money just to purchase goods. Children could also be seen using stacks of money as toys.

In recent history, Zimbabwe experiences a similar economic turmoil in the late 1990s shortly after the confiscation of private farms from landowners towards the end of Zimbabwean involvement in the Second Congo War. During the height of inflation from 2008 to 2009, it was difficult to measure Zimbabwe’s hyperinflation because the government of Zimbabwe stopped filing official inflation statistics. However, Zimbabwe’s peak month of inflation is estimated at 79.6 billion percent in mid-November 2008.

Invest in Hedges and Put them in Safe Storage

Now that we know why the government’s unfettered printing of fiat money devalues dollar, it’s important to also know how we can protect our wealth through making intelligent investments and know how to store them properly as a failsafe. Hedges against dollar devaluation and hyperinflation like gold, bonds, and precious jewels are a great option if you want to keep your wealth safe from financial instability.

To prepare for situations like these, it is also important to know how to safely store your assets. Keeping them at home can bring unwanted attention from robbers while storing them in banks subjects you to the risk of bank runs and bank collapse so the next best thing for you is private vaults.

At Private Vaults Australia, we make sure that your assets are safe from all kinds of risks from theft to natural disasters, to financial collapse. You can store your precious metals, security bonds, and other hedges in our state of the art safe deposit boxes so you can rest assured that your wealth is safe no matter what. Our company strives for 100% of your satisfaction by providing you with the ultimate protection and privacy through our Private Safety Deposit Boxes giving you a secure space for peace of mind.


Peter Hobson

My background involves the ownership of many businesses including owning and running multiple Chiropractic offices but mainly focused in Nerang on the Gold Coast for 30 Years.

I have a passion for accumulating and holding Bullion and have done so for many years. My extensive Business skills and Bullion knowledge makes it easy to assist others buying, selling and storing their Bullion.

Peter and Cassie work together to assist anyone from the experienced Bullion Investors to the complete novice. They are here to answer any questions to help you.

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