My daughter (15) just recently asked me why the mint does not make more money in times of financial hardships like we are in. I realize that it is a delicate system of checks and balances, but I am finding it hard to explain to her why this doesn't work. Can any of you help me out with this?

Thanks

Show her pictures of Germany before the second world war when they just kept printing loads of money and it became worthless. Or indeed Zimbabwe now.

Google Image Result for http://www.adolfthegreat.com/site/fileadmin/Image_Archive/Talent-Art/GermanWorthlessMoney.jpg (http://images.google.co.uk/imgres?imgurl=http://www.adolfthegreat.com/site/fileadmin/Image_Archive/Talent-Art/GermanWorthlessMoney.jpg&imgrefurl=http://www.adolfthegreat.com/Trails-Talent/economist-maxi.html&h=338&w=227&sz=10&hl=en&start=1&um=1&usg=__hKbTfF68EFCg7bhM8WDzz-BNv60=&tbnid=OymWSSp_nxUZCM:&tbnh=119&tbnw=80&prev=/images%3Fq%3Dgermany%2Bworthless%2Bmoney%26um%3D1% 26hl%3Den%26client%3Dfirefox-a%26rls%3Dorg.mozilla:en-GB:official%26sa%3DN)


It doesn't work because cash isn't actually money- it's just a promise of money in the bank (gold, jewels ect)

I often get bemused by money as it doesn't really exist when you think about it but it rules everything around us!

Probably not the best explanation but I wanted to post a link to the picture of a kid playing with blocks of notes because it worth less than toys.

EDIT

I suppose a way to say it is the more cash there is (as in coins and notes) the less money is worth. Because before one blat would buy you a loaf of bread but now everbody has twice as many blats the spending power of your blat has decreased by half, so that loaf is going to cost you two blats.

I remember my Dad explaining all this to me when I was younger- my head was spinning for days!

It will lower the value of the money already in print.

I guess I understood it all along then as that is what I told her, but I was not able to explain WHY it would lower the value.