Inflation. In short, countries set their own inflation rates and this is the amount of new money that enters circulation each year. A typical inflation rate might be 1% - which means that the total amount of money in the economy grows by 1% over the year.

It's important to realize that "money" no longer refers to the currency you see, feel and hold in a physical form. The majority of "money" is now virtual, and only exists in electronic format.

There has to be inflation for numerous reasons. One is that the world's largest corporations are only getting bigger and bigger. Billionaires are increasing their wealth every year. They are effectively taking money from the middle and lower class, and hoarding it themselves. As billionaires continue to hoard currency, the amount of currency in effective circulation decreases - and thus we need inflation to stop currency constantly being drained out of the economy.

Inflation usually happens through bank loans, or a similar style of lending. When you go to the bank and get a loan for $2,000, that money may be "virtually created" on the fly. It didn't exist before - but now it does. $2,000 has entered the economy at the very bottom of the chain (assuming you're a lower/middle class citizen). You'll go out and spend that money with businesses. Those business will hoard some of the profit, pay salaries and buy new stock. The staff who receive the salaries will spend their wages at other businesses, who will also hoard some of the money, pay further salaries and buy new stock.

Eventually, that $2,000 loan reaches large corporations who continue to just "hoard" and "save" the money.. That $2,000 has now reached the elite class of businesses/citizens and most likely won't trickle back down to the lower/middle class. That's why another $2,000 loan is then given out to ensure the economy stays stable.