WHAT REALLY HAPPENED TO THE DOLLAR

Those hoarding Dollars to sell at higher prices, the time to sell it is now.

The main reason why the value of Dollar skyrocketed against the Naira of recent is not far from some of the policy the government of the day made to force down it price. Unfortunately, that reverse happened. Before we go into the magic of the V.P that forced down the value of the dollar, let first discuss

the wrong things kept that kept reducing the value of the Naira. They include but not limited to the following:

SELLING OF DOLLAR TO THOSE THE GOVERNMENT DEEMED FIT

The sale of the Dollar to those the government deemed fit, such as those going for pilgrimage, manufacturers, traditional rulers etc. and stopping the sell to student, those going for medical trip abroad, and shopping compounded the matter the problem of the Naira. This will make those in need of Dollar have nowhere to turn but the black market and the pressure on the black market will increase the price.

FORCING BLACK MARKETERS TO SALE AT GOVERNMENT APPROVED PRICES

This temporarily reduced the price and the after effect is what we see today. Many of the marketers left their shops calling the interested buyers to meet them in other locations to make transaction. Customers that couldn’t locate those involved in such sales had to buy from anybody that had it. Thus the price was determined by how desperate the buyers where. This distorted the market to an unimaginable extent.

CORRUPT POLITICIANS AND CIVIL SERVANTS

Many corrupt politicians and civil servants that stole large amount of money during their time of active service, especially naira, saw the need to withdraw them from the banks after Buhari won the election out of fear. This was compounded by the introduction of the BVN. The best way to save the money they stole was in Dollars. This is because the Dollar will occupy less space compared to the naira. Hundred Dollars (1 piece) is equal to forty-six thousand Naira (46 pieces). So a politician that stole so much in Naira will withdraw them from the banks and buy Dollars from the black market for storing in their houses. This trend alone is what was suffocating the Naira.

CORRUPT BANK OFFICIAL

It will surprise you to hear that just as fuel stations prefer the sales of fuel to black marketers so also the banks prefer the sales of Dollars to black marketers. The reason is simple; the black marketers are ready to buy higher than the official rate but the banks customers may not. That was why the CBN at a point asked the banks to start submitting the reports of their forex because they had lots of sharp practices that mouth can’t tell.

Secondly you will be surprised to hear banks helps politicians in money laundering and it is done in foreign currencies. So the foreign currencies that are supposed to be sold to the ordering person on the streets and let say… black marketers are sold to the politicians who give the bankers handsome cuts. The ordinary man has nowhere to turn but the black market and the black market may not have enough to grapple with demands which will increase the pressure and price and price of the Dollar.

MOST NIGERIANS PREFER FOREIGN GOODS

Most Nigerians don’t want to be seen as locals because they consumed local goods and others don’t trust the Nigerian brand. These range from the common man on the street through celebrities to those in power. They prefer to shop abroad, holiday abroad and go for medical vacation abroad. Don’t ask me what the president went to London to do? The value of the Dollar will continue to increase because of this.

HOARDING THE DOLLAR

Just the way we hoard beans, rice, yam and palm oil for upwards of six months before selling, people prefers to hoard the Dollar. This is because you may not need to keep them for six months before you sell them to make good profit. Secondly, they don’t occupy much space as compared to the other commodities or goods that are hoarded. Good business don’t you think? To make the matter worse many of the individuals involved prefers to buy than sell, so they mop any available Dollars in the market. They are even willing to buy at higher prices, in as much as the price will catch-up and overtake the price they bought. That is why the government keep struggling every day to meet up with the demands. But I have a disappointing news for them. Continue reading.

What was the magic of the V.P that changed everything?

No magic but the following:

ORDERING BANKS TO SELL TO PEOPLE WITH ESSENTIAL NEED.

The VP ordered banks to start selling the Dollar to student and others that needs it for essential things abroad which was contrary to the military attempt aimed at forcing the market to comply with his stipulated price. Although this will put a lot of pressure on the government to supply the quantity needed by the banks. May be the recovered loots sorted that out, I wouldn’t know. But with banks complying to sell at the government approved prices, visits to the black market will reduce, so also will the pressure of demands (nobody will want to buy higher in the black market when banks sell lower). This will bring the price of Dollar down. This reason resulted to the next

PANIC SALES

The first reason resulted to people selling the Dollar they hoarded in panic and they are even willing to sell at lower prices so they won’t lose their customers to the bankers. Everybody wants to sell thus increasing the supply, and the demands reducing which will also force down the price the more.

Majority of us must have figured out the above arguments but what you may not know is the next reason.

THE AMERICAN GOVERNMENT WANT THE VALUE OF THE DOLLAR DOWN.

America government sees Russia as rivals but not as they see the Chinese. China is not only a threat to America in population, but also in economy and technology. Our main stay is the economy. The cheap labour that resulted in the cheap prices of goods from China is a major thing of concern to the American government. That was why Trump the American warned of the overvalue of the Dollar which subsequently forced down it value.

TOKYO -- The Dollar fell against the yen Wednesday morning in Tokyo, following warnings from U.S. President-elect Donald Trump that the greenback is too strong against the Chinese yuan, hurting the competitiveness of American companies.

This is to tell you that the VP is trying but the above news contributed greatly to what we see today.

Although it is possible that his God favors him because he is a pastor which resulted to the above. If he fails despite he claims he is a servant of God, then we are in for trouble.

CONCLUSION

If the American government are interested in seen the value of their currency fall so that their industries can compete with the Chinese industries, then the Naira sure has better days ahead. If the panic sales also continue as expected, then the best time to sale the Dollar you hoarded so far is now.

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I made it

Yeah, it is better for naira to rise...

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@ poster.
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