They made currency not based on gold for the purpose of supporting economic growth.
And regular people got fucked over as a result. They say that they loan money, print the amount and then keep track of it as a promise to pay it later.
To be honest, world's economic system is the same bubble as cryptocurrencies.
It's just this bubble is much much larger and has thicker walls.
Economy is not a closed system exactly because of the printing.
And inflation is there for the same reason.
It used to be dependent on the amount of gold the country had.
But now it's just a bubble. Current economic system is set up that way.
It definitely works and maybe produces some useful effects.
It's a stretch to assume it was implemented just to fuck over regular people.
Although it may be like that.
When banks lend money to nonsense people and nonsense projects who won't be able to pay back the loan, basically lending with no collateral, they increase the interest rate on those loans, and the debt packed into financial products and sold in the market. When the shit finally hits the fan and those loans fails, some banks might fail as well. But there is an expectation that those banks will be bailed out. This expectation creates moral hazard. It is why those kind of nonsense loans would be issued in the first place.
That process is inflationary.
A generally higher interest rate would mitigate this because less nonsense would acquire liquidity. So you would have to be more economically rational. But that would also mitigate growth.