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Money supply and its influence on the economy

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MacJu
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Post: #1
Money supply and its influence on the economy

Hello, I'm really curious, what influence does the amount of money supply really have on the economy?

I've been wondering about when exactly should I increase the amount, and by how much? Is there any proven strategy for this, so that the economy stays healthy and the currency doesn't lose value? Maybe the amount of money supply should be equal to the GDP?

I'm very interested in hearing other people's opinions and past experiences Smile

23.01.2021 11:45
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Errror42
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Post: #2
RE: Money supply and its influence on the economy

What I've read here: Always hold the supply somewhat over the GDP so the economy has space to grow. About 10%.

Money supply smaller than GDP is bad for the economy and can even lead to matrix crashs in older states.

24.01.2021 17:34
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JambalayaSam
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Post: #3
RE: Money supply and its influence on the economy

So hypothetically, a money supply decrease over GDP should spur deflation, which we can see in my state of Arborea (albeit a quarter late than expected). We can test it with mine and see where it goes, since I'm attempting to get the currency above $0.50 to stop the corruption issues.

25.01.2021 00:35
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Errror42
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Post: #4
RE: Money supply and its influence on the economy

To increase the exchange rate, try low interests (->letting the money supply grow) and decrease the GDP (against the inflation).

25.01.2021 11:45
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