₦airaland Forum

GOOD EXAMPLE KE

Omo i would admit that you don't know what you are saying.

good example of two countries that have fought wars over disputed territories.

Not only that, these guys HAVE NUCLEAR WEAPONS which means that they could blow up themselves everytime.

Economies of scale pertains to the size of beurocracy and not the number of states.

With more states, the bureaucracy increase as you need more ministries. Geez, this is common sense. Gosh, some people would never learn. Like i said earlier, IF YOU FREAKING WANT MORE STATES, THEN YOU AND YOUR PEOPLE SHOULD PAY FOR IT WITH YOUR TAXES AND QUIT ASKING THE FED. GOVT. FOR YEARLY BUDGET ALLOCATIONS.

nickybayo,
Did you get my original post, i posted under the name davidif. I would repost it.


Just imagine a country that produces only 10 goods, and in that country, there is only 10 naira floating around. What does that mean? it means that one good is cost 1 naira in this economy.

Now imagine another scenario where the central bank decides to print more money and at the end of the day there is 1000 naira in currency floating in the economy. What does that mean? It means that you have 1000 naira chasing 10 goods in an economy meaning that one good now costs 100 naira an increase of 1000% (from 1 naira to 100 naira is a 1000% increase).

This is the problem you have with Zimbabwe right now where the fed govt. just keeps on printing money. You also had the same problem with Germany after World War I were in order to pay there debts (as a condition of surrender) for starting the war. The victors (the allies) decided to punish them and order them to pay billions in reparations. They had no choice but to start printing money. The situation with Germany then and Zimbabwe at present is called hyper-inflation (that one mean say there own don pass ordinary inflation he he ). In the USA right now, the govt is printing more money as a way of "injecting liquidity" into the system mostly as a way of stopping deflation (which is way worse than inflation), they believe that inflation can be easily controlled. They have forgotten the lesson from the early 70's where Richard Nixon was printing money in order to combat the oil glut. This policies led to the massive inflation of the late 70's and caused stagflation (a recession plus inflation) which made Jimmy Carter lose re-election.

I hope this answers your question.