Doubled production of $100 bills by U.S. government may make an individual's money worth less, reports say
Money doesn't grow on trees. It's made on printers.
The past 12 months, the U.S. government doubled the amount of $100 bills it produced, which could make an individual's money worth less, according to The Wall Street Journal's Market Watch.
Ninety percent of the notes each year are used to replace notes that are already in or out of circulation, according to Nicholas Colas, ConvergEx Group Chief market strategist. He told Market Watch he believes the increase shows a substantial growth in the "underground" economy of drugs, illegal arms and tax-evasion transactions.
Producing $100 bills is a way the government makes money as it takes about 10 cents to produce a bill, according to the article. Every time the U.S. sells a note at face value, it adds to government increase.
"Since the U.S. dollar 'desperately needs to retain its status as the world’s reserve currency,' it is at least getting a kind of endorsement from its use in the underground economy, albeit from some really nasty people," reported Market Watch.
The depletion in dollar value over the past five years has created hardships not just for those within the United States, but for foreign countries whose monetary value rose as the American fell, according Finding Dulcinea.
Strong non-U.S. dollars hurt those individuals who rely heavily on exported goods, Finding Dulcinea says. For example, in Australia families involved in areas such as agricultural commodities, manufacturing and tourism were affected.