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How can fake currency destabalize our economy?
3 Answers
- Anonymous1 decade agoFavorite Answer
Currency of any country is a liability of its Reserve Bank. All Currency in circulation is backed by assets of the Issuing Reserve Bank.
A Fake currency only increases the liability of the Reserve Bank without any real assets backing the same. Not only this, the fake currency also increases Inflation in the economy to the extent and time it is in circulation.
- Eddy TLv 71 decade ago
By making people unsafe to hold and use money.Making the financial crisis worst and destabilise the economy.
- CowboyLv 61 decade ago
Will you sell your house to me for a couple of colored papers (that have no value) that does not account to anything.
If you do, economically, too, you are poorer and I am richer by that much.