₦airaland Forum

YourMrBoo:
No

why?

blinking001:
The CBN cannot print more money because we don't want to end up like Zimbabwe and Venezuela.

More money in circulation=higher purchasing power which in turn leads to high prices of goods and services.
Personally i believe all monetary policies are put in place to ensure the poor masses remain poorer.

Exactly bro.
The CBN and government in total are the biggest enemy of the poor masses and not Satan.
They are there to keep the masses poor, enough to survive and go to work the next day but not enough.

PNomsule:
I am really just curious as to "why can't we just print more money and solve the poverty problem in the country?"

Terms like "inflation" and the "devaluing of the naira" are the usual buzz answers to that question. Also, people give the example that if we were to print more money and just give everyone N5,000,000 for example, then everyone would go out and buy things, thus making "THINGS" more scarce and in short supply and hence driving up the prices of things (simple demand/supply economics). But herein lies the catch for me... With TRUE unemployment rate somewhere around 33% in the country, if DEMAND for "THINGS" rose, then I would think that companies would WANT to hire more people and build more processing plants to keep up with demand and raise their profits. So, the influx of cash (printed money) would seem to solve the unemployment problem.

Again, we have agencies that regulates pricing in the economy: PPPRA, Price Control Board (Ministry of Commerce) etc, with those, can't the likely over pricing of commodities (THINGS) be controlled and gazetted to avoid the story of "too much money chasing fewer goods"?

In the final analysis, a robust and health competitive economy would have been created and underemployment issues largely solved.

Economists and Analysts lets discuss?

Money doesn't exist. It's just a concept to keep people afloat.

PNomsule:
I think you're easy to relate with, you argue with sound perspective and broad knowledge base, I must acknowledge that.

Back to our discuss and importantly, a situation where Govt have to print more money and share is an aspect of a mixed economic system that combines aspects of both capitalism and socialism. What a mixed economic system does is it protects private property and allows a level of economic freedom in the use of capital, but also allows for governments to interfere in economic activities in order to achieve social aims. Hence I maintain that prices could be controlled.

(you will agree with me that in contrived circumstances, gravity can be felt less e.g Astronauts space travel.)

Again, if more people are employed, it means supply will increase relative to demand and the aspect of "too much money chasing fewer goods" diminished. Don't you think bruv?

I like the way you think.
Kudos to the person you quoted too.

PNomsule:
I am really just curious as to "why can't we just print more money and solve the poverty problem in the country?"

Terms like "inflation" and the "devaluing of the naira" are the usual buzz answers to that question. Also, people give the example that if we were to print more money and just give everyone N5,000,000 for example, then everyone would go out and buy things, thus making "THINGS" more scarce and in short supply and hence driving up the prices of things (simple demand/supply economics). But herein lies the catch for me... With TRUE unemployment rate somewhere around 33% in the country, if DEMAND for "THINGS" rose, then I would think that companies would WANT to hire more people and build more processing plants to keep up with demand and raise their profits. So, the influx of cash (printed money) would seem to solve the unemployment problem.

Again, we have agencies that regulates pricing in the economy: PPPRA, Price Control Board (Ministry of Commerce) etc, with those, can't the likely over pricing of commodities (THINGS) be controlled and gazetted to avoid the story of "too much money chasing fewer goods"?

In the final analysis, a robust and health competitive economy would have been created and underemployment issues largely solved.

Economists and Analysts lets discuss?

Do your googles on what global entity owns and controls almost all the central banks on Planet Earth. Whatever they say goes. Your fellow NL members have already done the research for us.

Rothschild Owns And Controls Central Bank Of Nigeria And More - Business - Nairaland

https://www.nairaland.com/3617604/rothschild-owns-controls-central-bank


The Central Bank Of Nigeria - Owned And Controlled By 'the Rothschilds' by Sunofgod(m): 7:10pm On Oct 08, 2011

https://www.nairaland.com/777773/central-bank-nigeria-owned-controlled


The Rothschild-owned Central Banks Of The World - CBN Included by NwaNimo1(m): 2:14pm On Apr 25, 2016

https://www.nairaland.com/3068596/rothschild-owned-central-banks-world-cbn


Meet The World Richest Family. by Alexbond(m): 9:31am On Oct 05, 2016

https://www.nairaland.com/3389312/meet-world-richest-family

PNomsule:
I am really just curious as to "why can't we just print more money and solve the poverty problem in the country?"

Terms like "inflation" and the "devaluing of the naira" are the usual buzz answers to that question. Also, people give the example that if we were to print more money and just give everyone N5,000,000 for example, then everyone would go out and buy things, thus making "THINGS" more scarce and in short supply and hence driving up the prices of things (simple demand/supply economics). But herein lies the catch for me... With TRUE unemployment rate somewhere around 33% in the country, if DEMAND for "THINGS" rose, then I would think that companies would WANT to hire more people and build more processing plants to keep up with demand and raise their profits. So, the influx of cash (printed money) would seem to solve the unemployment problem.

Again, we have agencies that regulates pricing in the economy: PPPRA, Price Control Board (Ministry of Commerce) etc, with those, can't the likely over pricing of commodities (THINGS) be controlled and gazetted to avoid the story of "too much money chasing fewer goods"?

In the final analysis, a robust and health competitive economy would have been created and underemployment issues largely solved.

Economists and Analysts lets discuss?

On price control by govts.. another name for it.. subsidy. For how long can govt control price?

As rich as Saudi Arabia and some Arab countries are, they are currently feeling the pinch (inflation) of over subsidizing a lot of products for their citizens hence they are gradually opening up their economy to allow more production in other areas, allowing more freedom to their women and encouraging them to be productive. Alsk they reducing and applying stricter measures on who can receive subsidies.

To add on why price control can be counter productive, Nigeria controls the price of dollar to Naira and whenever the it gets heavy on them and they remove their leg from the brake, we experience currency devaluation/runaway inflation.

To combat inflation and unemployment, we need to make more dollars not printing more naira note as our economy is literally import-dependent.
When there's dollar scarcity, naira will lose more value as much of it will be needed to buy the available dollar (needed to import things we consume) thereby leading to higher inflation.
To solve our economic problems, we need to create more avenue to make more dollars. Shikena

Komu1048:
Thought u have something meaningful upstairs, just another condemnation and no solution is provided. Let me continue reading and see if I will read someone better than you

get lost abeg, I don't owe a scatter head like you any explanations

Sucre6:
As an economist let me make this as clear as possible in lay man terms

Printing more money will lead to what is called money illusion when huge amount of money is chasing little amount of goods/services.

Printing more money will make the money valueless, which will plunge the country into deep stagflation, which is high unemployment and inflation join together.

Countries that their money has money value than ours would not invest in the economy.

Prices of things will skyrocket like mad, imagine having ten million naira and a price of big loaf of bread is one million naira, u end up spending ten million naira just to feed for 3 days.

With the ridiculous way the value of the money would be the country can't even import anything which will lead to more poverty, even the so call rich men and women would eventually run out of money to spend.

It's a scary situation, during covid 19, tinubu suggested that government should just print more money, I read the news and laughed at his nonchalant statement, which clearly shows that he understands nothing in money generation or managing the resources of the nation, reason why I will vote for Peter obi, not out of sentiment but out of the fact that he understands the uniqueness of Nigeria situation and knows how to economically tackle it.

great breakdown, best reply ever..... PS I'm not into politics...

blinking001:
The CBN cannot print more money because we don't want to end up like Zimbabwe and Venezuela.

More money in circulation=higher purchasing power which in turn leads to high prices of goods and services.
Personally i believe all monetary policies are put in place to ensure the poor masses remain poorer.

how about we print more money to clear debt and buy refined crude oil? this way the money wont stay in the country

Timekeeper452:
Lol. Let me explain it this way. Money is just a piece of paper, it is literally just a piece of paper. What makes money important is actually what that money can buy itself and not the money at hand. Now imagine if a bag of beans is Valued at 50,000 naira. And you just keep on printing money and handing it over to everyone, what happens when the money in circulation outweighs the beans in circulation? It just becomes useless or the price of that beans will skyrocket up and your money looses its value. If you keep printing more, the beans will either eventually run out or the price of that beans will sky rocket till your money becomes useless in value. So the solution isn’t printing more money because it will just mean something everyone can have, and if everyone can have that, then consumption will outweigh production, and something must fund that production. That being said, don’t be fooled, governments print money steady, that’s how they steal and embezzle and become rich. If you just don’t print, the population of those in existence will outweigh the money in circulation and your country will just collapse. What Nigeria is facing is that we don’t fund the right things in this country to generate production, we rely so much on importation and we have corrupt leaders stealing these money meant to be in circulation.

You should be a teacher. Simple, clear and straight to the point.

Printing more money will cause high inflation..

OP let me use a lay man's way to explain.

What is common does not have value but what is scarce has value.

I was expecting someone to say that government should refine our crude oil to stop us from importing petrol.

Ajaokuta steel should start working to reduce importation of steel.

Roads should be repaired so food can come easily from remote farm settlement.

Health and education should be taken care of to stop people from going abroad to seek these services.

The oga of all is electricity to stop people from investing all their cash on generators and petrol.

All these listed and many more will make our naira have value.

But because we need these things from abroad then the government directly makes these countries we import from make their money more valuable.

Why do you think Russia insisted countries pay for their oil in rumbles which is Russian money.

Zimbabwe and Venezuela are case study.

Print too much money and everyone is a millionaire like what happened in Zimbabwe then who will willingly farm when he or she can afford to buy food items which will lead to hyper inflation.

Wetin scarce get value but wetin common no get value

We are complaining that the naira is being devalued
You want us to print more..
One of the major qualities of Money is that it should
Scarce.

If governments print money to pay off the national debt, inflation could rise. This increase in inflation would reduce the value of bonds.
If inflation increases, people will not want to hold bonds because their value is falling. Therefore, the government will find it difficult to sell bonds to finance the national debt. They will have to pay higher interest rates to attract investors.
If the government print too much money and inflation get out of hand, investors will not trust the government and it will be hard for the government to borrow anything at all.
Therefore, printing money could create more problems than it solves.

miketayo:
how about we print more money to clear debt and buy refined crude oil? this way the money wont stay in the country

sense no go kill you

Timekeeper452:
Lol. Let me explain it this way. Money is just a piece of paper, it is literally just a piece of paper. What makes money important is actually what that money can buy itself and not the money at hand. Now imagine if a bag of beans is Valued at 50,000 naira. And you just keep on printing money and handing it over to everyone, what happens when the money in circulation outweighs the beans in circulation? It just becomes useless or the price of that beans will skyrocket up and your money looses its value. If you keep printing more, the beans will either eventually run out or the price of that beans will sky rocket till your money becomes useless in value. So the solution isn’t printing more money because it will just mean something everyone can have, and if everyone can have that, then consumption will outweigh production, and something must fund that production. That being said, don’t be fooled, governments print money steady, that’s how they steal and embezzle and become rich. If you just don’t print, the population of those in existence will outweigh the money in circulation and your country will just collapse. What Nigeria is facing is that we don’t fund the right things in this country to generate production, we rely so much on importation and we have corrupt leaders stealing these money meant to be in circulation.

I agree with you.

PNomsule:
I think you're easy to relate with, you argue with sound perspective and broad knowledge base, I must acknowledge that.

Back to our discuss and importantly, a situation where Govt have to print more money and share is an aspect of a mixed economic system that combines aspects of both capitalism and socialism. What a mixed economic system does is it protects private property and allows a level of economic freedom in the use of capital, but also allows for governments to interfere in economic activities in order to achieve social aims. Hence I maintain that prices could be controlled.

(you will agree with me that in contrived circumstances, gravity can be felt less e.g Astronauts space travel.)

Again, if more people are employed, it means supply will increase relative to demand and the aspect of "too much money chasing fewer goods" diminished. Don't you think bruv?

If govt prints more money and initiate price control to prevent inflation, the end result will be scarcity because demand will simply outstrip supply. Buhari tried this in his first presidency but couldn't get anywhere.
The same concept was one of the reason for the collapse of communist USSR. Gorbachev tried to force price control but only led to empty shelves in the supermarket.
No business man will produce out of charity. What u suggesting means the entrepreneur should bear the brunt of govt incompetence. He will end up with money not enough to produce more products.

Unfortunately the international market where Nigerian govt has no influence will not be merciful. They will adjust their exchange rate to adjust the reality on ground. Naira will have a free collapse against other global currency. With importers not having enough to Forex to keep business going, the country will enter stagnancy and stagflation.

The govt can go round this by insisting on self sufficiency policy, import restriction, and promoting import substitution.
However, no man is island. There are very few products Nigeria can build from scratch, we cant produce phone or cars without importing products, we also need lots of industrial components and chemicals to keep the factory running. In ability to get this done will lead to economy contraction leading to recession as in IBB era of IMF led SAP. It was a terrible time for Nigerians, middle class was wiped out. Nigerians will now be left with lots of naira that can buy mothing.
Even if Nigerians works very hard and are able to break through the import restriction by becoming self sufficiency, govt will now be forced to withdraw excess naira from circulation to reflect the reality on ground. This is to ensure lazy loafers are not unreasonably rewarded when they ve contributed nothing to the economy
As u can see it's a meaningless cycle that gets nobody anywhere.

Sucre6:
As an economist let me make this as clear as possible in lay man terms

Printing more money will lead to what is called money illusion when huge amount of money is chasing little amount of goods/services.

Printing more money will make the money valueless, which will plunge the country into deep stagflation, which is high unemployment and inflation join together.

Countries that their money has money value than ours would not invest in the economy.

Prices of things will skyrocket like mad, imagine having ten million naira and a price of big loaf of bread is one million naira, u end up spending ten million naira just to feed for 3 days.

With the ridiculous way the value of the money would be the country can't even import anything which will lead to more poverty, even the so call rich men and women would eventually run out of money to spend.

It's a scary situation, during covid 19, tinubu suggested that government should just print more money, I read the news and laughed at his nonchalant statement, which clearly shows that he understands nothing in money generation or managing the resources of the nation, reason why I will vote for Peter obi, not out of sentiment but out of the fact that he understands the uniqueness of Nigeria situation and knows how to economically tackle it.

Louder!!

In a simplistic way:


Print more money when your currency is not valued.

See it this way;

Our naira is only important here, and no where else.

We sell our oil to other countries, money comes in, and we use it to develop our country. Note( the money that comes in is in euro, dollars, or pounds) , we can use it to attract foreign investors and buy parts to develop the country.


The train that was bought by Amechi was in Dollars and not Naira.

Printing more money in a country like Nigeria is not advisable.

Timekeeper452:
Lol. Let me explain it this way. Money is just a piece of paper, it is literally just a piece of paper. What makes money important is actually what that money can buy itself and not the money at hand. Now imagine if a bag of beans is Valued at 50,000 naira. And you just keep on printing money and handing it over to everyone, what happens when the money in circulation outweighs the beans in circulation? It just becomes useless or the price of that beans will skyrocket up and your money looses its value. If you keep printing more, the beans will either eventually run out or the price of that beans will sky rocket till your money becomes useless in value. So the solution isn’t printing more money because it will just mean something everyone can have, and if everyone can have that, then consumption will outweigh production, and something must fund that production. That being said, don’t be fooled, governments print money steady, that’s how they steal and embezzle and become rich. If you just don’t print, the population of those in existence will outweigh the money in circulation and your country will just collapse. What Nigeria is facing is that we don’t fund the right things in this country to generate production, we rely so much on importation and we have corrupt leaders stealing these money meant to be in circulation.

So,how how did borrowing solve the situation

jumper524:
Bros in a financial analyst and I've always maintained this perspective.
Many financial policy are not real, they are all artificial and several factors make them happen.
Printing more money knowingly leads to artificial inflation but secretly still maintains the economic situation.

Modified: a simple question to all those relegated minds calling me fools. Those who don't have the balls to question status quo.

1, Why do countries borrow when they have money in their external reserves.

2, if countries like USA, CHINA, UK e. t. c are the top debtors in the world, which countries come dey borrow them the money?

Ever asked yourself why can't cbn print more naira and sell our crude oil in Naira so Europeans can source for our local currency.

Agbado and cassava financial analyst well done o. Am sure if Tinubu becomes the president and decide to keep printing more naira notes, you will come out to defend his policy of printing more naira notes. By the time Nigeria becomes Zimbabwe of 2020 with inflation rate of 558% you all will be the ones to suffer.

PNomsule:
sense no go kill you

RZArecta:
you're not a financial analyst oga, stop lying and even if you insist you are then you're obviously very terrible at your job and I'll advise every sane person to run away from you

He is not only a good financial analyst, he is deeply thoughtful dude. Whereas you come out as poorly informed and badly educated.
1. Read up on quantitative easing.
2. Answer the questions he brilliantly put together.

PNomsule:
why?

Agriculture is one part of the economy.

Inflation will still be in effect in other parts of the economy...

Buh it's a good start but the effect will just be negligible.

kamalbob:
Easy to say if you don't know how money or printing in general works. As an expert in printing (academically) let me wrap it up in a short note. Money are printed on gramage paper which cost a lot, also the security prints on those papers before the actual print is done also cost huge amount of money.

So in a nutshell, you have to spend money to print money. If not because of this obstruction, those greedy politicians will print money like tomorrow no dey I'm telling you

.....and you think they are not printing money?

miketayo:
how about we print more money to clear debt and buy refined crude oil? this way the money wont stay in the country

Which country will collect your Naira??

Hahahaha

You want to pay fines in Naira, hahaha

You pay it in other currencies, and that can only be gotten by selling our oil to them or exporting.......



People funny.,...
No body knows naira in Togo

Sucre6:
As an economist let me make this as clear as possible in lay man terms

Printing more money will lead to what is called money illusion when huge amount of money is chasing little amount of goods/services.

Printing more money will make the money valueless, which will plunge the country into deep stagflation, which is high unemployment and inflation join together.

Countries that their money has money value than ours would not invest in the economy.

Prices of things will skyrocket like mad, imagine having ten million naira and a price of big loaf of bread is one million naira, u end up spending ten million naira just to feed for 3 days.

With the ridiculous way the value of the money would be the country can't even import anything which will lead to more poverty, even the so call rich men and women would eventually run out of money to spend.

It's a scary situation, during covid 19, tinubu suggested that government should just print more money, I read the news and laughed at his nonchalant statement, which clearly shows that he understands nothing in money generation or managing the resources of the nation, reason why I will vote for Peter obi, not out of sentiment but out of the fact that he understands the uniqueness of Nigeria situation and knows how to economically tackle it.

Lmao you were making sense until your lady few lines. Tinubu gave a candid advise for 2020. It was modeled by the USA too and some other countries. That was the best time to print more Naira. Everyone expected an economic meltdown after the pandemic and printing more notes to our reserve could have kept us afloat at least to some extent.
That man you mentioned is an error BTW he didn't even improve the economy of his state.

Sucre6:
You see, it's a vicious cycle, take for example, when more people are employed, they will be paid right, what is the value of working when u know that the money you will be paid won't be enough to buy you food to eat not to talk of clothing and luxury, it gets to a point when the money becomes so valueless that there will be no need to work, a case study is Zimbabwe.

When there is stagflation, prices can't be controlled because an individual could monopolies the market take for example, when dangote refinery is ready, he would be a sole producer of oil in Nigeria, when when stagflation sets in, you can't control or regulate how he sales his product because the whole country is dependent on him for survival, it's will be wild like going back to stone ages.
Now this is a practical example

Take for instance if our normal exchange rate is maybe #1,000 to 1$ dollar and a crude of oil is sold at #100,000 these foreign countries would have to exchange $10 dollars just to acquire one barrel of oil, but when stagflation sets in, exchange rate would be crazy, say N100,000 for $1 dollar and a barrel of oil is sold at 100,000 to foreign export for example, when stagflation sets in and the naira looses it value, you could buy 10 barrels of oil for $1 dollar

These illustration above means, the value of money that the foreign countries pays for 1 barrel of oil when the economy was good, same amount of money would buy 10 barrels of oil when the economy becomes bad thereby plunging the economy into deeper hyper inflation, most countries wont even buy from Nigeria then, to avoid importing inflation to their country, yes a country could be plunge into inflation by importation from inflation Country.


The solution to solving these, The CBN introduces monetary and fiscal policy

Which include Open Market operation, sales of bonds and securities and so on, they do this to rake in excess money in circulation, and when this is continued the money in the economy would be just fine to run the economy. The extreme measures is devaluation of the face value of the currency,

So that's it, hope it's clearer now?

Throw more light on the bolded please.

PNomsule:
I am really just curious as to "why can't we just print more money and solve the poverty problem in the country?"

Terms like "inflation" and the "devaluing of the naira" are the usual buzz answers to that question. Also, people give the example that if we were to print more money and just give everyone N5,000,000 for example, then everyone would go out and buy things, thus making "THINGS" more scarce and in short supply and hence driving up the prices of things (simple demand/supply economics). But herein lies the catch for me... With TRUE unemployment rate somewhere around 33% in the country, if DEMAND for "THINGS" rose, then I would think that companies would WANT to hire more people and build more processing plants to keep up with demand and raise their profits. So, the influx of cash (printed money) would seem to solve the unemployment problem.

Again, we have agencies that regulates pricing in the economy: PPPRA, Price Control Board (Ministry of Commerce) etc, with those, can't the likely over pricing of commodities (THINGS) be controlled and gazetted to avoid the story of "too much money chasing fewer goods"?

In the final analysis, a robust and health competitive economy would have been created and underemployment issues largely solved.

Economists and Analysts lets discuss?

Our current model of economics is badly rigged in ways I can't explain.

Spirit04:
the question you should ask yourself is why someone who got free 5m for doing nothing would want to be working in a company where he will be getting paid 100k or why a farmer would go to the farm to plant yam from which he cannot even sell 300k when he received free 5m.
People would want to go to the bar to drink. Why would the bartender be there to serve you a drink for which at the end of the month he will be paid 50k when he got 5m?
When people refuse to go to the farm or do those things the ones doing it will hike the price because you will have no choice other than patronising them. That's where you get inflation.
The biggest people causing inflation in the country are drug dealers and yahoo miscreants

well and cleverly explained.