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Nairaland Forum / Nairaland / General / Business / Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? (34931 Views)
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Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Ebookmathswaec: 8:17am On Oct 11, 2017 |
Why can't we print the $5.5bn ourselves instead of borrowing since we can print money ourselves? I believe if we print the money ourselves, we can use it for whatever we want and we won't need to pay back money to anybody. Nairalanders pls! I need explanation. 20 Likes 6 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by seunmsg(m): 8:24am On Oct 11, 2017 |
Ebookmathswaec: You want to print another country's currency? 273 Likes 25 Shares
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Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by sorextee(m): 8:25am On Oct 11, 2017 |
Very funny question.. Even the naira sef, we cant just be printing it anyhow.. it would lead to inflation, the money no go get value. more money chasing fewer goods. 138 Likes 8 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Ebookmathswaec: 8:26am On Oct 11, 2017 |
seunmsg: No. I mean Naira equivalent. 76 Likes 5 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by thesicilian: 8:42am On Oct 11, 2017 |
Ebookmathswaec:Somehow makes sense. 25 Likes 2 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Adeyinka12(m): 8:45am On Oct 11, 2017 |
following.... jejely |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by malton: 8:48am On Oct 11, 2017 |
Ebookmathswaec: Because printing such a huge naira amount would result in inflation. 113 Likes 3 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Ebookmathswaec: 8:50am On Oct 11, 2017 |
malton: And borrowing the same huge amount won't do same? 172 Likes 7 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by 1freshdude: 8:50am On Oct 11, 2017 |
Money is valuable because it is relatively scarce, the level of productivity in a country is always put into consideration before taking this decisions, else money loses value, it becomes worthless and an alarming inflation ensues. Zimbabwe is a good example of what printing more money in the face of very low output can cause. 148 Likes 9 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by malton: 8:56am On Oct 11, 2017 |
Ebookmathswaec: No, it would not, as government borrowing does not create new money. There are a lot of technicalities involved. This particular borrowing is aimed at maintaining foreign exchange rate figures. 32 Likes 3 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by JAkpayen(m): 9:00am On Oct 11, 2017 |
@OP, Look at it from this angle: If every Nigerian is given access to print his/her money to use for buying or paying debt, what do you think will happen to the economy? There is no reason why it is not technically possible but the naira will become junk and a piece of tissue paper will be more valuable than that. Basically, the naira is only valuable if it's scarce, because we use it to procure scarce resources. 116 Likes 5 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Nobody: 9:03am On Oct 11, 2017 |
Foreign companies don't transact in naira, but dollar. 8 Likes |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Truckpusher(m): 9:05am On Oct 11, 2017 |
1freshdude:Print the goddamn thing and before the West will wake up and suspect anything you've already used it in buying shares, gold, companies from their economy while bringing in policies that will lure their investors down here with the promise of cheap labor and wait till everywhere is calm. Haven't you heard about currency manipulation by China that America keeps crying about while they are the chief currency manipulators. 120 Likes 10 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by bakynes(m): 9:08am On Oct 11, 2017 |
1freshdude:Exactly, what I was going to say but to expaintiate more in lay terms, if you produce products and services worth $1m dollars and you print $5m dollars that means you are putting too much money in the hands of individuals for $1m dollars worth of productivity, this will now bring about inflation. Because the seller knows you now have money he will charge you whatever he offers(either goods or services)5X more so the cost of goods and services will sky rocket and inturn devalues your local currency. It simply an economics principle. 47 Likes 5 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by abescom: 9:09am On Oct 11, 2017 |
thesicilian:Makes no economic sense. It will lead to massive inflation and worsen the economy. 16 Likes 2 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by spokesboy: 9:09am On Oct 11, 2017 |
Ok |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by lonelydora: 9:10am On Oct 11, 2017 |
Ebookmathswaec: When i was in primary 4, i used to think like you. Which school did you graduate from? Even if it's naira we are seeking for, we can't print it because it will lead to what we call INFLATION 30 Likes 3 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by nairavsdollars(f): 9:10am On Oct 11, 2017 |
Invitation to inflation 6 Likes |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by itiswellandwell: 9:10am On Oct 11, 2017 |
Hmmmmm.. Lemme learn. Check my signature for ongoing promo of our full capacity powerbank 1 Like 2 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Built2last: 9:10am On Oct 11, 2017 |
lol 1 Like |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Brugo(m): 9:10am On Oct 11, 2017 |
What a question! Okay, even if I would answer you. You want to turn us to zimbabwe? You will flood the economy with cash. Inflation will ravage our economy and our money will become worthless. Besides, have you thought about the cost of printing the naira equivalent? Anyway, I want to believe you're just pulling our legs. 7 Likes 3 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by donqx: 9:10am On Oct 11, 2017 |
hmmm |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by dionysus7: 9:10am On Oct 11, 2017 |
Ebookmathswaec: Please be kidding 11 Likes |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Nobody: 9:11am On Oct 11, 2017 |
Ebookmathswaec: Because....inflation Many often ask why government’s don’t print more money to deal with the problem of national debt. The reason is that printing more money doesn’t increase economic output in any way – it merely causes inflation. Suppose an economy produces £10 million worth of goods; e.g. 1 million books at £10 each. If the government doubled the money supply, we would still have 1 million books, but people have more money. Demand for books would rise, and firms would push up prices. The most likely scenario is that if the money supply were doubled, we would have 1 million books sold at £20. The economy is now worth £20 million rather than £10 million. But, the number of goods is exactly the same. We can say that the increase in GDP is a money illusion. – True you have more money, but if everything is more expensive, you are not any better off. In this simple model, printing more money has made goods more expensive, but hasn’t changed the quantity of goods. https://www.economicshelp.org/blog/634/economics/the-problem-with-printing-money/ See what happened in ZImbabwe and Germany 1919-24 32 Likes 2 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Ochasky23(m): 9:11am On Oct 11, 2017 |
You want the naira to be like the Zimbabwean dollars right. If too much money is in circulation, it leads to inflation. You could even buy a loaf of bread for 200k 11 Likes 2 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by sunnyside16(m): 9:11am On Oct 11, 2017 |
Hahahahahahahahaha i am wondering too. |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Cloud007: 9:11am On Oct 11, 2017 |
guy...printing more money does not nessarily mean inflation but wen CBN over does it. see its a NO NO for nigeria cos of who we are. we will continue to print until it super dwafed the rate of GDP growth. zimbawe inflation will be a child's play wen we are done with ourselves 4 Likes |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Feranchek(m): 9:11am On Oct 11, 2017 |
I been tink sey you dey joke o! So you really mean am! Nna kamdan biko 3 Likes |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by eponoloyin: 9:11am On Oct 11, 2017 |
The cost of printing nko? or you think it's A4 paper they use 25 Likes 3 Shares |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Nobody: 9:11am On Oct 11, 2017 |
Okay |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by code11(m): 9:11am On Oct 11, 2017 |
OMG! Inflation will kill off the country if that happens. Monetary policy is a slightly dicey thing. 6 Likes |
Re: Foreign Loan: Why Can't CBN Print The $5.5bn Instead Of Borrowing? by Adeoba10(m): 9:11am On Oct 11, 2017 |
Inflation will occur... Money will not have value..... For example, you need 5k, you went to your photocopy machine and printed it out, if you get to the market and they called toothpick for you at d rate Of 3000naira, you will just pay them and leave bcus you have d printing machine @ home. Look at Zimbabwe for another example.... 7 Likes 1 Share |
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