₦airaland Forum

That question is very germane. That is why we have characteristics of money, and one of them is that money must be relatively scarce to maintain its value. If every country chooses to start printing money, most countries will not be willing to tap into many given natural resources. The multiplier effect would be a great danger to the development of any nation.

According to the economists, the more cash in circulation the more the devaluation of the currency.

Bullfallo:
Simply put money is value and not assets. The level of inflation we have today was cause by APC printing money. A Hugh chunk of those printed money were stack underground. While some of it went into circulation. The naira notes now is so dirty and old. They have stop printing money.

Clubs are now selling old notes. The new once’s are now hard to find. Probably holding it for election.

See what am talking another one here
Is it APC that print currency now.?

Dazzay:
But your god Tinubu advised the failed late Buhari to print more money to curb inflation when the failed Buhari was in power.

Stop being silly my bro...


Ain't a Tinibu fan....


Stop being silly, I repeat...

This is the question Emefiele should have asked if as a CBN governor, he did not know a simple basic thing about issues like before going to just be printing money into the economy, which almost resulted in hyperinflation.

As for OP, they say he who asks questions does not get missing. If you do a nairaland search, about 3 years ago someone asked the same questio,n and believe me, there were a lot of quality explanations why it is not a good idea at all.

thorpido:
That would be called Idi-Amin style or Mugabe's Zimbabwe style.

Idi Amin did that?

Printing Money is not a normal and logical financial system practice across the globe, countries who resort to such practice only do that when their economy is facing revenue crisis and had no where to turn in meeting the nation's financial needs.
The resultant effect of this currency printing decision eventually leads to excess money in circulation outside of the banking system and in turn sky rocket the countries inflation rate, sky rocketing prices of goods when demand outweigh production.
It also erode a nations currency value and eventual exiting foreign nvestors due to the red flag it portrays on the country's financial crisis.

Money looses face value and increases inflation when it's too much in circulation.

My understanding though, economist can explain better

One the qualities of money is scarcity, if you print, inflation will finish your country.

I once asked too. Buhari borrowed before resorting to massive printing.

Dannydrums889:
Why do countries borrow money when they can just print them? 🤔

Bankers and Accountants, Please explain 😢

The reasons why countries can’t print money is simple, it will devalue the value of your country’s currency. Also can skyrocket the prices of goods and commodities

The answer is because so long as an country is not a Robinson Crusoe economy, her wealth is not in the amount of natural resources it has or the amount of money it can print but in the amount of foreign currency it is able to accumulate... Adman Smith (1776)

Note: If a nation operate a complete closed economy (Robinson Crusoe economy), then her wealth depends not on the amount of natural deposits it has but on the utilisation of the resources for domestic walfare gains.

1. Inflation and Hyperinflation :
When too much money is printed without a matching increase in goods and services, the value of money falls.
This leads to inflation (prices rising) or even hyperinflation (money becomes nearly worthless).

Examples: Zimbabwe in the 2000s and Venezuela recently — they printed excessively, and their currencies collapsed.

2. Trust and Credibility:
A country’s currency only works if people trust its value.

If a government prints recklessly, investors, businesses, and citizens lose faith, leading to capital flight and economic collapse.
Borrowing through bonds and loans shows discipline and keeps trust in the financial system.

3. Foreign Trade:
To import goods (like oil, machinery, technology), countries often need foreign currencies (dollars, euros, yuan).

Printing more local money doesn’t create foreign exchange reserves. Borrowing from international markets or institutions helps secure those.

4. Controlled Financing:
Borrowing allows governments to spread the cost of big projects (like infrastructure, schools, hospitals) over time, rather than destabilizing the economy.

Debt can be structured with interest rates and repayment schedules that match long-term economic growth.

5. Central Bank Independence,:
In many countries, the central bank is independent from government. It carefully controls how much money enters circulation to maintain stability.

If governments could just print freely, political leaders might overuse it for short-term popularity, wrecking the economy.

Because printing notes isn't backed by productivity, thus, resulting to inflation.
That's why the notes changed by Emefiele never worked, cash should only be printed so people can use it as trust of the fund they have truly worked for, not so they can say they have xyz amount of money.

Minting much money will actually lead to inflation they say.
Why are we after money everyday of life is because our government failed to provide the citizens the basic infrastructure amenities.

GRAMMARJAMES:
exactly my question.. and please no one should come here and shout inflation because we all know what inflation is and how it works. i'm a practicing chartered Accountant and i can tell you for free that Printing money may be costly but it is still better than borrowing .. our Government just prefer to be penny wise pound foolish

What will you use to print the money?

You purchased the materials you will use to print the with the resources you are exporting.

Everyone in first page talking about inflation & productivity, yes they are correct "another serious point is, world is a global market and you don't use your own currency to trade in global market, so, printing more money is almost useless, since you will trade in international markets with foreign currency, that's why they go and borrow it directly from international bodies, which normally loan the foreign currency."

Example, all military equipment are being purchased with dollar, so if we like, let print, 100 trillion naira, it's useless like ORDINARY paper wen it get to foreign lands , where we need currency to buy such military hard & softwares

tunde1200:
Children in NL come and learn.
Let bankers and economist enlightened you and stop hating Tinubu....!

The enlightenment doesn’t change the fact that he is failure personified….a puppet being used by the IMF .

thorpido:
That would be called Idi-Amin style or Mugabe's Zimbabwe style.

You for to add Buhari style as well. He did the same thing.

Exousiang01:
Money is not the paper you hold in your hand.

The bulk of the money around the globe is not in cash. Only 8% of the money is in cash, that means the remaining 92% is not not cash.

So you think Damgotes $23billion is sitting in one bank account somewhere?

Or you think Elon Musk has his billions kept in one bank...

PS: It cost more money to mint money, so minting money is actually not ideal

i'm forry, this is not an anwer to the question. according to economics

It's simple: when you print money and give to people to spend, it will naturally reduce their productivity and the more you print money, productivity will continue to decline until the people will become so lazy that they are no longer producing anything. so in the end, you will have people with a lot of money (cash) and nothing to buy with the money. The country runs out of goods and services. Now you can't print the currency of other countries to be able to buy goods from them. So what are you going to do? Start chewing your worthless paper?

So, you see that the value of money actually lies in the goods that are produced, not in the paper. Paper money(also known as fiat money) has no intrinsic or inherent value. It has value because it is backed by goods and services produced in an economy. That is why once the quantity of goods and services produced in an economy drops, money starts losing value. If quantity increases, money starts gaining value. Today in Lagos you can find N100 tomato because the quantity of tomoato produced has increased or we are in the season. If the same thing happens in other sectors of the economy, the value of money will increase further

Because eventually it will become worthless without production, imagine using 5m to eat a plate of rice

What a good question.
First and foremost what is economics and what is money once you understand the two that is your answer.

Dannydrums889:
Why do countries borrow money when they can just print them? 🤔

Bankers and Accountants, Please explain 😢

Same reason YOU can't just Print money and expect people to accept it. Other countries can't just accept e.g naira with our any value behind it.

Printing money increase the supply of money thereby making the currency less desirable and lead to fall it's value.

Where as borrowing money can do all the things that Printing is intended for and without increasing the supply of currency.

They both have similar consequences and benefit too; raising debt and falling GDP can lead to fall in confidence from international investors which can lead to economic disaster.
So both printing and borrowing must be done with skill and moderation.

LaIabobo:
Only USA can afford to print money (dollars) and have minimal effect on their economy. Even so, countries can’t just print money because it makes prices go up (inflation). If they keep printing, the currency loses value as there is too much in circulation.

Why do you think only USA can do that?

1. Size of their economy OR
2. The dollar being the global reserve currency.

Dazzay:
But your god Tinubu advised the failed late Buhari to print more money to curb inflation when the failed Buhari was in power.

Is your eternal enemy Tinubu printing more money for over two years that he's been in power? That's the yardstick and not what he said when he was ordinary citizen

Tintinnoty:
It goes beyond just minting currency. any country that try that is joking with inflation. Ask Zimbabwe or Mogabe

Why are you all citing Zimbabwe as an example? The almighty USA is going through the same problem as we speak. The US dollar has been overprinted and acute inflation is ravaging Americans as we speak.
With the continued unstoppable growth of China the US dollar is facing challenges America is unprepared for.

Kimo21:
The enlightenment doesn’t change the fact that he is failure personified….a puppet being used by the IMF .

At least you know IMF
If it reach your Messiah Obi to rule the country use or find another better ways to solve generation issue Nigeria have.

Printing more money increases inflation.
Printing more money reducs productivity.Why should the people work again when plenty of money is available?
Money is not the only element that makes country's economy strong but its export products it can exchange for other countries' currencies.
That is why there is always a limit to which a nation can print money