Wow...menh this is very bad having a unfavorable balance of trade.God saves us

aguiyi:


anuofia, simple economics you don't know yet you will be typing trash every now and then on topics that are way beyond your mental capacity

faints!

tete7000:


Sorry, I missed your question. I thought you said if they are the lowest. Back to your question, hypothetical you may seem correct but how do you reverse what has already happened? Bringing those as highest denomination would not correct inflation that has happened already. Only serious fiscal measure can be used to correct inflation you already had. People won't lower prices of good because of the lowest denominations, it will only mean you need more of the currencies to buy your goods. That implies you carry more money around and that's the reason why bigger currencies need to be printed to reduce quantity of money people need to carry around.

Got it now. Thanks

Mrbigman1:


Please school me the Magic GMB would perform to avert the falling Naira?

Guess his gonna regulate the oil price right?

Look, a country is Tryn it's best in hard times to fix fallen things. U can imagine all these re happening and ur food price is still going down instead of skyrocketing, the price of houses have not gone up, the stock market have not collapsed. Now something more than just economic is happening in Nigeria.

We have drastically reduced the price of food importation, cars, cement and a lot and mind u, for u to jump up, u have to bend down.

Pray for ur nation and dnt always wish it collapses, if it dose, u'd suffer it the more.

It's about time the oppositions leave this life of ill wishes and wish for a better country.

If you read my previous posts, I'm not trying to sell you Buhari. The issue is about breaking a vicious cycle and downward spiral with no sight in end. Do you sincerely believe your Jonathan has any intention or initiative for digging this country out of the present quagmire ?
Even if I'm to agree with your skewed opinion that the rates of goods and services have remained static, well these are early days. if you can still make this boast 3 months from now then know that it sheer providence sustaining the country and not your government.
And get up to date with what's going on with stocks, let's pray it won't crash despite the daily devaluation and capital flight...stock crazy investors are gnashing teeth as we speak.

Anyway, it doesn't matter, buharry or no buharry change is coming ! This psuedo-Democracy is fed up with Nigeria, and the reset button is about to be pressed..once more. A country can only take so much punishment, nothing lasts forever.

erico2k2:

let me say something to be used as food for thought,if I have an LPO to supply wood to a local factory in say New castle(England) and I have the option of say Brazil and Nigeria, since my pounds/Dollar now has great Value in Nigeria, where do you think I will go? just food for thought.

You absolutely won't choose Nigeria because the country is unstable, unfriendly politically controlled business environment cultural corruption unskilled labor force etc.

You will choose Brasil which probably isn't perfect but you will be facing less challenges.

tunex23:
Corruption everywhere, meanwhile see how Nigerians are suffering for electricity

Hahaha na this one sharp pass....

AdeniyiA:


you've already got your N10 change from fuel

na wa o

Forwetinnah:


Change in 50 naira denominations

OK o

aguiyi:


anuofia, simple economics you don't know yet you will be typing trash every now and then on topics that are way beyond your mental capacity.

demand and supply is what determines price in a free market.

have you asked yourself what Nigerians are doing with the US dollar that has made it so scarce that the price is heading north.

has it become our legal tender or we are experiencing an artificial scarcity created by those who have an agenda.

suddenly in this period of election the dollar is no more available. the naira started losing its value when the abokis gave their brother licence to buy and sell other currencies on the streets.now they are hording it creating panic in the process.

we no longer import much of rice
we no longer import cement
we no longer import much of cars

what then is the new line of business that is drying up the available foreign currencies. those who stashed the green back in their house with the hope of releasing them when their candidate wins election are only fooling themselves because they will regret it with the new policy that is coming.

that is how they intend to stabilize the naira

Dear Aguiyi,

Nice reply. As much as you listed things we do not import, lets not forget that a major factor of production is energy in form of (petrol, kerosine & diesel). I sang this song few weeks a go that the CBN is broke, so the naira would be devaluated again to save face and prices would sky rocket. Please give it just 2~3months before you start seeing the effects of true hardship.

Simple scenario:
An oil marketer importing petroleum products obtained a credit facility of $2million when the official rate was #155/1$ a few months ago. Now the naira has been devalued twice to #199/1$. By this devaluation, (#199- #155) x $2000000= loss of #88,000,000 to start with.
Who pays for this difference, its the common man on the street.

As we all know, we are an import dependent nation. Apply this simple scenario to all imports and major industries like Cadbury, Nbc, Nestle,etc who import some of their raw materials.

My fear is a lot of Nigerians dont have a complete understanding of what is going on. The currency has been devalued but salaries still remain the same with pending inflation in a few days. Market Prices have not changed yet because a lot of retailers are still selling old stock. If things continue like this, then we are done for.

shobroy10:
are u as clueless as ur G2019 mentor nawa ooooo

Buhari is a certified terrorist
Buhari will fail and after that he will be hit by stroke
Because Buhari is a terrorist
Apc Is bokoharam
Gej till 2019

kaboninc:

This is a fragment of your post:



So you didn't mention "revalueing" in the first place but am sure you meant "devalueing"!

But in case you don't mean any of the above, at least you've learnt one or two things!

Shalom!

Common dude..u mean u didn't see were I stated that if SOLUDO was allowed to mek #20 naira note the highest denomination,it wud have increase the value of naira?..an is that not revaluation?..an am saying that the same govt. Has turned around to devalue the same naira,or isn't that a "policy-saumersault"? So I don't get your quoting me out of context...do u read before u comment or u only interested in bashing?

fairheven:


Common dude..u mean u didn't see were I stated that if SOLUDO was allowed to mek #20 naira note the highest denomination,it wud have increase the value of naira?..an is that not revaluation?..an am saying that the same govt. Has turned around to devalue the same naira,or isn't that a "policy-saumersault"? So I don't get your quoting me out of context...do u read before u comment or u only interested in bashing?

Lol!

If I had wanted to BASH you, I would have!

No bro. Revaluation of the naira does not necessarily means increase in value. In fact the most important factor is a STRONG ECONOMY, an economy that is LESS IMPORTED ORIENTED! When we have a TRADE SURPLUS that's in OUR favour. Can you compare the economic activity between Soludo's time and Now? In Soludo's time, we imported about $1.6 billion (or close to it) worth of rice. That's a strong pressure on our naira. But today, that's about $700 million (about 56% reduction in export bills on rice alone and the balance has been CHANNELED into our economy to boost LOCAL RICE PRODUCTION, thus STRENGTHENING our NATIONAL ECONOMY)

Our major source of income as a nation is from CRUDE OIL. But as you can see, the shock in a sharp or consistent decline of your major source of income can have a devastating reverberating effect on the economy. Its common business sense. You don't put all your eggs in one basket but spread in different baskets because the higher the number of baskets, the probability that ALL will fall someday becomes smaller! Hence the drive for diversification.

Secondly, the Government did not just wake up one day to 'devalue' the naira. The current realities were responsible. There are so many things involved and it was in the best interest for the economy that the CBN had to act that way. Dwindling oil prices, election frenzy, abuse, round tripping, speculative trading, all contributed and CBN had to use its own Reserve to sustain imports at the detriment of the economy.

I had asked a question before, GHANA revalued their currency, why not check what's up with them?

won91:



Dear Aguiyi,

Nice reply. As much as you listed things we do not import, lets not forget that a major factor of production is energy in form of (petrol, kerosine & diesel). I sang this song few weeks a go that the CBN is broke, so the naira would be devaluated again to save face and prices would sky rocket. Please give it just 2~3months before you start seeing the effects of true hardship.

Simple scenario:
An oil marketer importing petroleum products obtained a credit facility of $2million when the official rate was #155/1$ a few months ago. Now the naira has been devalued twice to #199/1$. By this devaluation, (#199- #155) x $2000000= loss of #88,000,000 to start with.
Who pays for this difference, its the common man on the street.

As we all know, we are an import dependent nation. Apply this simple scenario to all imports and major industries like Cadbury, Nbc, Nestle,etc who import some of their raw materials.

My fear is a lot of Nigerians dont have a complete understanding of what is going on. The currency has been devalued but salaries still remain the same with pending inflation in a few days. Market Prices have not changed yet because a lot of retailers are still selling old stock. If things continue like this, then we are done for.

does the word abnormal increase mean anything to you. just like in accounting we recognize abnormal profit so also in other areas there is also abnormalities .

Mrbigman1:



That's the point.

CBN have been wedging the Naira since and pumping the scares dollars uncontrollable into circulation to strengthen the Naira.

Now the Nigerian market is getting stable and they decided to let it survive it's self instead of wasting our reserve.

Now if output increases after election base on GDP, Naira can pick up without no support.
Imagine Nigeria not exporting oil to USA yet the economy seems stable, imagine wen everything gets normal and export resumes, hope we'd hit the sky

You right!!

The postponed election really did alot of harm to our economy, I don't really care who wins again, let them just hold the shiiit so we move on with our lives

Keneking:
Chai Jonathan's government has finished us finally......................................................................

there is hope bro. change is coming.

kaboninc:


Chai!!! CHISOS!!!!

Let me painfully quote my statement:



And this was your silly comment:


So which one is "it can't stop anything"? What has it got to do with what I wrote? Did you note that I was responding to a request from someone?

Do you just come here to form champion with your silly arguments? Park well oh and make you dey look face before you comment!

your comment is still enveloped with low mentality to understand your words. When i said my friend did i tell u he handles the biz as an individual or a corprate body? I didnt give u full details of if its a coprate body. Yet u open your stinkin mouth saying rubbish. If the bank now buys at 199 and sell at 217 did it stop them from making gain? Did it end any madness? Think before you type.

won91:

Dear Aguiyi,

Nice reply. As much as you listed things we do not import, lets not forget that a major factor of production is energy in form of (petrol, kerosine & diesel). I sang this song few weeks a go that the CBN is broke, so the naira would be devaluated again to save face and prices would sky rocket. Please give it just 2~3months before you start seeing the effects of true hardship.

Simple scenario:
An oil marketer importing petroleum products obtained a credit facility of $2million when the official rate was #155/1$ a few months ago. Now the naira has been devalued twice to #199/1$. By this devaluation, (#199- #155) x $2000000= loss of #88,000,000 to start with.
Who pays for this difference, its the common man on the street.

As we all know, we are an import dependent nation. Apply this simple scenario to all imports and major industries like Cadbury, Nbc, Nestle,etc who import some of their raw materials.

My fear is a lot of Nigerians dont have a complete understanding of what is going on. The currency has been devalued but salaries still remain the same with pending inflation in a few days. Market Prices have not changed yet because a lot of retailers are still selling old stock. If things continue like this, then we are done for.

#thatisall.

Sanusi and Soludo were accused of fear mongering, in the end this was predicted. CBN continues to run more like a bank and less like an Economy regulator.

PDP led administration has tearfully ruin the economy. When Soludo indict Okonjo Iweala of mismanaging the economy, many people think the professor is unrealistic. Now, the downward trend in the value of naira is a clear proof of what Soludo hinted recently.

We need change indeed in Nigeria. Vote APC

PDP's monumental failure in the area of electricity, employment, infrastructure etc can only be redeem through change

kaboninc:


Lol!

If I had wanted to BASH you, I would have!

No bro. Revaluation of the naira does not necessarily means increase in value. In fact the most important factor is a STRONG ECONOMY, an economy that is LESS IMPORTED ORIENTED! When we have a TRADE SURPLUS that's in OUR favour. Can you compare the economic activity between Soludo's time and Now? In Soludo's time, we imported about $1.6 billion (or close to it) worth of rice. That's a strong pressure on our naira. But today, that's about $700 million (about 56% reduction in export bills on rice alone and the balance has been CHANNELED into our economy to boost LOCAL RICE PRODUCTION, thus STRENGTHENING our NATIONAL ECONOMY)

Our major source of income as a nation is from CRUDE OIL. But as you can see, the shock in a sharp or consistent decline of your major source of income can have a devastating reverberating effect on the economy. Its common business sense. You don't put all your eggs in one basket but spread in different baskets because the higher the number of baskets, the probability that ALL will fall someday becomes smaller! Hence the drive for diversification.

Secondly, the Government did not just wake up one day to 'devalue' the naira. The current realities were responsible. There are so many things involved and it was in the best interest for the economy that the CBN had to act that way. Dwindling oil prices, election frenzy, abuse, round tripping, speculative trading, all contributed and CBN had to use its own Reserve to sustain imports at the detriment of the economy.

I had asked a question before, GHANA revalued their currency, why not check what's up with them?

Story story..wat was our debt profile during SOLUDO's tenure compare to present?ur president is emptying our reserve both foreign an local all in the name of elections,subsidy allocations are going up,at a time wen crude oil prices are falling allfor elections?
..an bad as u tink Ghana's currency is,its still better an stronger than naira or not?..so just leave Ghana out it,can u compare Nigeria's per capita to Ghana's?wat theory are u postulating?revaluation doesn't mean increase in value are u seriously kidding me,wat school of tot is that?

[quote author=b03liberty post=31079897][/quote]

well, i understand what you mean. But development is a gradual process. At least, we have started from somewhere.

thinkdip:

when last did u patronize your own local products. , and pls teacher tell me the product which will allow people opt for more in Nigeria which is not a foreign product. and I want to know the ratio of locally patronise product to foreign,which will not cause inflation.
because I dont know if its either phone,electronics and lots more you produce in Nigeria. .even toothpick is produced from ghana. so what are u saying?

well, let every Nigerian with manufacturing tendencies/ideas/abilities see this as a call to action. Innoson motors is made in Nigeria. Instead of importing your car from obod'oyibo, wear/enter/ board vehicle to biafra and buy your car there. Instead of buying airplane from abroad, visit Nigerian airforce/army and they will build for you. Don't worry, there is enough steel at ajaokuta. Don't travel to dubai to buy jewelries anymore; buy your jewelries from the local goldsmith. Instead of importing Italian shoes, visit that shoemaker in your street for your new shoes. Let us start from somewhere at least. Nigerians don't buy Nigeria because Nigerians don't trust in Nigerian products.

989900:


In that sense, the Naira is already well devalued @ the N155-165 band. Personally, I don't see why, whoever will want to come buy wood, cocoa and e.t.c @ N160/$1 won't do so, unless it's trading @N199/$1 . . . if other factors are right.

The major issue is the 'free-falling Naira', due to our over reliance on oil, and other factors.

You can have the Naira @ N200, N300 to a dollar, but you can't have any currency behaving that epileptic.

The Naira is currently competing with war torn Ukrainian Hryvnia, and Zambia Kwacha for worst performing currency in the world.

Ok the reason I cited that example was cos of China.this was their posirion 12 years ago.The west castigated the artifitialy manipulating the valie of their currency ie not allowing demmand and supply to dictate.I dnt kniw if U cud remember this even.if U can grab a copy of economic history of china past n present U will be informed.hard or soft copy.Devaluation is neccessary for economic growth.it will attract forign investors ccos they will come with jard currency cos labour would be cheap to them amd raw material will also be cheap.

fairheven:

Story story..wat was our debt profile during SOLUDO's tenure compare to present?ur president is emptying our reserve both foreign an local all in the name of elections,subsidy allocations are going up,at a time wen crude oil prices are falling allfor elections?
..an bad as u tink Ghana's currency is,its still better an stronger than naira or not?..so just leave Ghana out it,can u compare Nigeria's per capita to Ghana's?wat theory are u postulating?revaluation doesn't mean increase in value are u seriously kidding me,wat school of tot is that?

guy tbh they guy U quoted made more sence

I think this is bad, this is an easy way out to creating demand n it is bad in the long run. naira is worthless it's why pple r not demanding 4 it. the solution is to improve and increase quantity of local goods so that pple will demand 4 it cos of quality n we enjoy the advantage of economy of large scale production. If this is done pple will genuinely seek 4 naira cos of it quality (worth). Devaluation is just reducing price to induce demand. There r other factors that affect demand n we should be focusing on them not price.

TharyeS:
[/quote][quote author=TharyeS post=31064933]

hw on earth with dis boost home trade? Are u sure u pass thru sch @ al ? No wonder u keep typin thrash... " even if a Naira shud be 1,000 naira.' SMH

fairheven:

Story story..wat was our debt profile during SOLUDO's tenure compare to present?ur president is emptying our reserve both foreign an local all in the name of elections,subsidy allocations are going up,at a time wen crude oil prices are falling allfor elections?
..an bad as u tink Ghana's currency is,its still better an stronger than naira or not?..so just leave Ghana out it,can u compare Nigeria's per capita to Ghana's?wat theory are u postulating?revaluation doesn't mean increase in value are u seriously kidding me,wat school of tot is that?

I don't know if I should lecture you in a civil, moral and calm way or blast you with insults and still lecture you. Maybe you'll learn should I use the latter method. But my conscience will deal with me.

See what you just wrote, and with confidence!

ur president is emptying our reserve both foreign an local all in the name of elections,subsidy allocations are going up,at a time wen crude oil prices are falling allfor elections

That means you actually do not know a thing about this subject matter. And you talk to me in a way like you know? With facts to support you?

Let me feel you in, just a bit.

During Soludo's bank consolidation exercise, banks were ask to recapitalise so as to strengthen their capital base. The essence was to birth a stronger, robust, confident, flexible, effective and sound banking system. The banks were taunted to lead the growth and development of the economy. These capital injections were to come from various sources, Private Placements, IPOs, bonds, mergers, acquisitions, etc. But do you know what happened?

After the exercise, some banks made it (25 of them) and others couldn't. Today 3 of these banks have gone under and had to be acquired by the government. 5 of these banks were given lifelines by the banks. Others had to make huge provision for large non-performing loans. These loans were latter acquired by AMCON. Remember also that crude oil prices went down as it is today. The Capital Market was bailed out with about N30 billion. About N8.6 trillion naira was lost between 2007 - 2010 and Soludo was the Chief Banker from 2004 - 2009. You know what that meant, reckless abandon, little or no supervision, bad policy planning post consolidation exercise and poor risk management.

Under Soludo's watch, banks gave out loans to their staff to buy the bank's shares. You know what that did, it jerked the share price of the banks causing the banks to be overpriced. So many insider dealings I do not want to going into. All these under Soludo's watch! You know what it cost us as a nation?

Coming to your debt, it is very normal and healthy to take loans. What matters is what you do with it. There are so many factors to consider before taking loans. Such as the GDP, income generation, needs appraisal, etc. So if a loan can be obtained to build rail tracks from the North to the South of Nigeria, buy trains to convey people and goods along this corridor, after which deductions will be made for gradual payment of the loan, then there's absolutely nothing wrong with it.

We borrow for many reasons - no ready cash or easily convertible asset, to meet a need, etc. I believe I've given you some lectures to ruminate. Please read carefully, make your research before coming here to counter me.

Thanks and cheers!

erico2k2:

Ok the reason I cited that example was cos of China.this was their posirion 12 years ago.The west castigated the artifitialy manipulating the valie of their currency ie not allowing demmand and supply to dictate.I dnt kniw if U cud remember this even.if U can grab a copy of economic history of china past n present U will be informed.hard or soft copy.Devaluation is neccessary for economic growth.it will attract forign investors ccos they will come with jard currency cos labour would be cheap to them amd raw material will also be cheap.

Thank You!!!

won91:

Dear Aguiyi,

Nice reply. As much as you listed things we do not
import, lets not forget that a major factor of
production is energy in form of (petrol, kerosine &
diesel). I sang this song few weeks a go that the
CBN is broke, so the naira would be devaluated
again to save face and prices would sky rocket.
Please give it just 2~3months before you start
seeing the effects of true hardship.

Simple scenario:

An oil marketer importing petroleum products
obtained a credit facility of $2million when the
official rate was #155/1$ a few months ago. Now
the naira has been devalued twice to #199/1$. By
this devaluation, (#199- #155) x $2000000= loss of
#88,000,000 to start with.
Who pays for this difference, its the common man
on the street.

Why am confident this analysis is one sided is because you assumed the price of that product at #155/1$ to the new exchange rate of #199/1$ to be the same. Haba! That's unfair.

That's a flawed, skewed and improper analysis.

What was the landing cost of 1 litre of PMS when crude was hovering about $100 per barrel to when it was less than $40 per barrel? This is a better way to analyse.

stevecantrell:



If you read my previous posts, I'm not trying to sell you Buhari. The issue is about breaking a vicious cycle and downward spiral with no sight in end. Do you sincerely believe your Jonathan has any intention or initiative for digging this country out of the present quagmire ?
Even if I'm to agree with your skewed opinion that the rates of goods and services have remained static, well these are early days. if you can still make this boast 3 months from now then know that it sheer providence sustaining the country and not your government.
And get up to date with what's going on with stocks, let's pray it won't crash despite the daily devaluation and capital flight...stock crazy investors are gnashing teeth as we speak.

Anyway, it doesn't matter, buharry or no buharry change is coming ! This psuedo-Democracy is fed up with Nigeria, and the reset button is about to be pressed..once more. A country can only take so much punishment, nothing lasts forever.

What then is your point?

In 2007 - 2010 especially late 2008 to early 2009, thw world was knocked into a financial mess and our very own Soludo messed up big time. Within that same period, the price of crude oil also drop to a low of close to $38 per barrel. And it stayed down for a long time. What happened, 8 banks were exposed, Capital Market crashed, inflation went up.

Today, the world is still recovering from that financial mess but still new discovery in Shale Oil exploration led to crude oil prices to fall and fall as low as $40 per barrel. However, there is still no single bank to be declared bankrupt, the market only slumped but still active, inflation still single digit and rising by 0.1 basis point as at January 2015, import bill reduced especially on rice because we now produce rice. Yet roads are being built, railways constructed, trains bought, power plants built, universities built, salaries increased, Army equipped, airports remodelled!

Does this not tell you that someone is working?

kaboninc:


What then is your point?

In 2007 - 2010 especially late 2008 to early 2009, thw world was knocked into a financial mess and our very own Soludo messed up big time. Within that same period, the price of crude oil also drop to a low of close to $38 per barrel. And it stayed down for a long time. What happened, 8 banks were exposed, Capital Market crashed, inflation went up.

Today, the world is still recovering from that financial mess but still new discovery in Shale Oil exploration led to crude oil prices to fall and fall as low as $40 per barrel. However, there is still no single bank to be declared bankrupt, the market only slumped but still active, inflation still single digit and rising by 0.1 basis point as at January 2015, import bill reduced especially on rice because we now produce rice. Yet roads are being built, railways constructed, trains bought, power plants built, universities built, salaries increased, Army equipped, airports remodelled!

Does this not tell you that someone is working?

I am bookmarking this thread because of your comments. Weldone

Embosman:
I think this is bad, this is an easy way out to creating demand n it is bad in the long run. naira is worthless it's why pple r not demanding 4 it. the solution is to improve and increase quantity of local goods so that pple will demand 4 it cos of quality n we enjoy the advantage of economy of large scale production. If this is done pple will genuinely seek 4 naira cos of it quality (worth). Devaluation is just reducing price to induce demand. There r other factors that affect demand n we should be focusing on them not price.

Guy you are missing the point, the only currency in Demand world wide is the Dollar.

kaboninc:


What then is your point?

In 2007 - 2010 especially late 2008 to early 2009, thw world was knocked into a financial mess and our very own Soludo messed up big time. Within that same period, the price of crude oil also drop to a low of close to $38 per barrel. And it stayed down for a long time. What happened, 8 banks were exposed, Capital Market crashed, inflation went up.

Today, the world is still recovering from that financial mess but still new discovery in Shale Oil exploration led to crude oil prices to fall and fall as low as $40 per barrel. However, there is still no single bank to be declared bankrupt, the market only slumped but still active, inflation still single digit and rising by 0.1 basis point as at January 2015, import bill reduced especially on rice because we now produce rice. Yet roads are being built, railways constructed, trains bought, power plants built, universities built, salaries increased, Army equipped, airports remodelled!

Does this not tell you that someone is working?

Good obs.I really wish more people will take time to analyze like this guy B4 commenting.