Why is the CBN not printing more money if we are so poor?

Thank you very much for that question,

Why did you tell your parents you bought an iPhone15 for 50k when you bought it for millions?

Because if they knew you had that much money, their expectations and demands would skyrocket.

My name is Tomi, and welcome to my medium channel

Let’s talk about a nation’s ability to print its way out of debt or poverty.

Spoiler alert: It can’t, at least not sustainably.

The root of the problem is that printing excess currency leads to inflation.

And inflation erodes the value of that currency.

You see, money doesn’t have inherent value; it’s only a piece of paper

Whose worth is derived from what it can purchase. Simple.

When the government floods the market with too much cash, each piece becomes less valuable because there’s more of it in circulation chasing the same amount of goods and services.

Let’s say the government prints N30 billion and gives it to everyone.What do you think will happen?

Everyone will become a certified #30BG

Everyone will rush to buy goods and assets when there’s an excess of currency floating around.

Everyone will turn to Yhemolee, Dorime every night

If everyone has more cash, won’t we all flock to buy houses in Banana Island?

Then the real estate guys will quickly realize that the money supply has ballooned while the number of houses remains the same. Everyone has 30 billion and the house is only 1 billion per unit. They have only 5 units, what do they do?

Basic economics tells us that when demand exceeds supply, prices rise.

So Ola of Lagos will increase prices to capitalize on the situation. 1 unit 45 billion.

Boutique owners, Tapioca sellers, even Amala Skye will raise their prices enormously. Why?

Because they can.

Are you still with me?

The money supply has grown exponentially while available goods remain the same.

It’s only natural to want to capture the maximum amount your customers can pay when you know they have more cash on hand.

Economic chaos, Hullabaloo

Real economic growth has to be driven by increased productivity, innovation and value creation

Excessive money printing erodes confidence in a currency’s stability.

If forex traders and global investors sense an excess supply of a certain currency due to money printing, they will sell that currency, causing its value to drop

The very poverty and economic troubles the government tried to take away will only get amplified instead. We will still be poor, just poor in billions

Creditors will demand higher interest rates to compensate for the devalued currency.

Imports become more expensive, worsening trade deficits.

Government spending needs to increase to keep up with rising prices.
Everything will be expensive, eggs will be 24 million naira per crate

It creates a counterproductive debt spiral that leaves the nation in an even worse financial position than before the money printing began.

There are no shortcuts to sustainable economic growth and stability.

Policies must focus on:

• Maintaining monetary discipline and currency stability
• Incentivizing productivity, innovation and real value creation
• Investing in education, infrastructure and a conducive business environment
• Implementing fiscal policies that encourage investment and employment

Resorting to money printing is ultimately trying to dig our way out of a hole with a teaspoon — it might feel productive, but it only deepens the pit.

You can ask Zimbabwe, they printed money to pay off debts, and ended up worse off.

I hope I have been able to answer your question.

Stay happy and stay hydrated✌️