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The banking authorities, whether central or not, "monetize" the deficit, printing money to pay for the government's efforts to survive. The hyperinflation under the Chinese Nationalists from 1939 to 1945 is a classic example of a government printing money to pay civil war costs. By the end, currency was flown in over the Himalayas, and then old ...
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Computers could not handle the amount of zeros such that other forms of money had to be used to act as normal money (bearer's cheques). Banks had to input a lesser amount on the deposit or withdrawal slip then would put a covering statement, such as "multiply by 1 000 000 or add 10 zeros to your amount to get the real value". The same was true ...
The shortfall was largely addressed by printing more money. [29] The government's reliance on printing money to fund the war effort led to hyperinflation, with wholesale prices in Shanghai increasing fivefold from September 1945 to February 1946, and then thirtyfold the following year.
In Germany between the two world wars, inflation rose to such a point in the early '20s that a loaf of bread cost a million or more marks. Cities and townships printed their own money in a ...
Debt monetization or monetary financing is the practice of a government borrowing money from the central bank to finance public spending instead of selling bonds to private investors or raising taxes. The central banks who buy government debt, are essentially creating new money in the process to do so.
History of the American Economy. 11th ed. Mason, OH: South-Western/Cengage Learning, 2010. Ward, Harry M. "Review: Money and Politics in America, 1755–1775: A Study in the Currency Act of 1764 and the Political Economy of Revolution." The Journal of Southern History 40.3 (1974): 460–462. Further reading. Brock, Leslie V.
A wildcat bank is broadly defined as one that prints more currency than it is capable of continuously redeeming in specie. A more specific definition, established by historian of economics Hugh Rockoff in the 1970s, applies the term to free banks whose notes were backed by overvalued securities – bonds which were valued at par by the state, but which had a market value below par. [2]