r/PeterExplainsTheJoke • u/Melodic_Judge_129 • 9h ago

Meme needing explanation Petah?

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u/PuzzleheadedFee6943 8h ago

why not just start printing money then?!

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u/Classy_Maggot 8h ago

Germany tried that once. There's a reason the Weimar Republic lasted for about a decade

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u/samrus 8h ago

but they werent trying to curb deflation, they printed more money to pay debts to other countries. i imagine if we are trying to curb deflation then we'd increase the monetary supply by a calculated amount to not increase inflation too much

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u/wazeltov 3h ago

This concept is called quantitative easing (QE) and it doesn't always work. Though notably, it did work in '08 after the Great Recession.

Deflation cause people to be afraid of spending money because aggregate demand is much lower. It's certainly possible that QE doesn't fix consumer spending habits. Money is typically not given to people directly because that may cause separate issues. For example, some of the COVID era inflation was due to people receiving money directly from the government, which signaled to businesses that excess capital could get soaked up with price increases.