NateNizz

Your first point makes absolutely no sense. If we finance outsourcing operations with Canadian Dollars, we'll just increase the Money Supply on the International level and devalue our currency... The only thing that can even out the Increase in Money supply, is for inflation to happen. Lets say your economy had $100... If you print another 100$ increasing the total to $200, then prices have to increase. More money = Less purchasing power. If you were a retailer, and you sold an item for 1$ when your economy had $100 in currency.... But the economy's money supply doubled, you would have to increase prices because the dollar now buys less. If you were to give $100,000 to every Canadian, there income would increase relative to eachother. Money would be worth less, and Price levels rise. Therefore, financing by printing money leads to inflation. The US is in a scary situation and you can already see the devalueing of their dollar. Its going down and only has further to go down as its a very instable economy right now. The country is being run on debt and printed money (not real). Their currecny is devalueing and the only thing holding it up right now is the fact that CHina has over $800 billion in US treasuries, Japan $700 billion and trillions of dollars from the rest of the world. The world can't handle a large devalueing of the US dollar. If the USD was cut in half, all these countries holding US reserves would lose half of their value... Luckily the USD has been used a world reserve for many currencies, or we would be in a lot of trouble!