I know this is a really silly question that is really obvious, but what's stopping a country from just printing out a few more billion of their own currency and then using that money to buy goods from other countries? Is there a certain rule they have to follow? And what are the impacts to the economy if they did do that?
Printing money doesn't mean that their wealth increases. It just devalues the money they already have. So it will just take more money to buy goods from another country.
Printing money will also lead to over inflation which has its own set of problems such as:
- Higher interest rates
- People will buy durable goods to store wealth such as gold
- Cost-push inflation