lexy2014:


How does the price of apple turn to N1.16 from N1 just because money supply increased to N116 and there is 100 apples in the economy?

Since the goods didn't change in the example the new price level adjust to N1.16. All the money is spent buying apples in this example since everyone demands apples. Any more questions?

N116÷100 apples= N1.16 (new price after money supply increased)
N100÷100 apples=N1 (original price)

Blue3k:


Since the goods didn't change in the example the new price level adjust to N1.16. All the money is spent buying apples in this example since everyone demands apples. Any more questions?

N116÷100 apples= N1.16 (new price after money supply increased)
N100÷100 apples=N1 (original price)

How did you come to the conclusion that "All the money is spent buying apples"?

Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

Up till now, you haven't explained how that is possible?

It is basic economics, my brother.

lexy2014:


How did you come to the conclusion that "All the money is spent buying apples"?

Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

Up till now, you haven't explained how that is possible?

Inflation occurred so purchasing power decreased. Everything is spent in the example. In the example. It's possible because it's a hypothetical economy for simplicity. This is why the economy has 1 product that is consumed exclusively. If you had a problem with the premise you could have stated that earlier.

Other that that it still explains how and why increases in money supply without increases in production results in higher prices. You can add more factors like imports exports, multiple goods, and marginal rates of saving but the results remain similar.

Blue3k:


Inflation occurred so purchasing power decreased. Everything is spent in the example. In the example. It's possible because it's a hypothetical economy for simplicity. This is why the economy has 1 product that is consumed exclusively. If you had a problem with the premise you could have stated that earlier.

Other that that it still explains how and why increases in money supply without increases in production results in higher prices. You can add more factors like imports exports, multiple goods, and marginal rates of saving but the results remain similar.

you mixing it up. More money resulted in inflation but not directly. Currency rebasing is what leads to instantaneous appearance of inflation.

I am a rice farmer and seller and do sell 3600 bags a year. Along the line rice becomes less available and I have just 1000 bags for this year. I know if I go at the old price I will run out of stock by April so I adjust a little by jerking prices up until demand returns to a level my 1000 bags can last me through the year.
Now govt prints more money, paid workers in civil service and contractors handling constructions but I got no part of it. Well I won't seat down and allow people who couldn't afforded my harvest before suddenly exhaust it by June with govt printed cash in their hands. I have to readjust to the new level of money in the system. Thus a price increase.

Now such readjustment comes with speculation. The printer of cash will always lag behind the producers of things when it comes to increases thus inflation.

CodeTemplar:
you mixing it up. More money resulted in inflation but not directly. Currency rebasing is what leads to instantaneous appearance of inflation.

I am a rice farmer and seller and do sell 3600 bags a year. Along the line rice becomes less available and I have just 1000 bags for this year. I know if I go at the old price I will run out of stock by April so I adjust a little by jerking prices up until demand returns to a level my 1000 bags can last me through the year.
Now govt prints more money, paid workers in civil service and contractors handling constructions but I got no part of it. Well I won't seat down and allow people who couldn't afforded my harvest before suddenly exhaust it by June with govt printed cash in their hands. I have to readjust to the new level of money in the system. Thus a price increase.

Now such readjustment comes with speculation. The printer of cash will always lag behind the producers of things when it comes to increases thus inflation.

You are wrong. The printer of cash is at a high advantage. Losers are fixed wage earners and people with money in bank accounts. People with means of production lose nothing. Their power to generate wealth remains thesame

Blue3k:


Inflation occurred so purchasing power decreased. Everything is spent in the example. In the example. It's possible because it's a hypothetical economy for simplicity. This is why the economy has 1 product that is consumed exclusively. If you had a problem with the premise you could have stated that earlier.

Other that that it still explains how and why increases in money supply without increases in production results in higher prices. You can add more factors like imports exports, multiple goods, and marginal rates of saving but the results remain similar.

You didn't answer my questions.

Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

When did the inflation that you occured ocuur? Was it before money supply was increased or after?

If u say that your example "hypothetical", then how is it at the same time a possibility?

What other factors are we adding? You gave a straight jacket claim...increase in money supply from N100 to N116 with 100 apples automatically caused inflation. What's there to add?

Gajagojo:

Lagos economy is growing. It is now over $100 billion
That is double what it was 10 years ago
Can you tell us how many countries in the world have achieved that?
your premise that they have lexy2014 been unable to drive growth is untrue
That is double what it was 10 years ago
Can you tell us how many countries in the world have achieved that?
your premise that they have lexy2014 been unable to drive growth is untrue

You didn't answer my questions.

Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

When did the inflation that you occured ocuur? Was it before money supply was increased or after?

If u say that your example "hypothetical", then how is it at the same time a possibility?

What other factors are we adding? You gave a straight jacket claim...increase in money supply from N100 to N116 with 100 apples automatically caused inflation. What's there to add?

slawomir:
Tinubu's administration is a disaster

Tell dem again make dem hear. Dem never see any suffer dem just start... dem go suffer more. Next time you will never put confirmed drug barron in power, confirmed corrupt junkie in power. Tinubu is finished, known for running padi padi government. Due to his hate for CBN gov he dished him and brought in confirmed clueless man because of beef. Tinubu na Complete clueless president

lexy2014:


You didn't answer my questions.

Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

When did the inflation that you occured ocuur? Was it before money supply was increased or after?

If u say that your example "hypothetical", then how is it at the same time a possibility?

What other factors are we adding? You gave a straight jacket claim...increase in money supply from N100 to N116 with 100 apples automatically caused inflation. What's there to add?

I did answered both questions.I said in the example all the money is spent nothing is saved. This means when more money is available more stuff is demanded. Remember how inflation was defined in previous comments. If you know what it is then you know it occurred when it happens. I defined as the increases as money supply itself. Other do it as increase it prices. Either way it's after its more money is added.

Hypothetical doesn't mean impossible. This scenario is possible. You can add other factors i mentioned but the results will be similar.

Seun:
Dear Nairalanders,

I regret to inform you that the Central Bank of Nigeria printed an alarming quantity of money electronically in June 2023 (source).

They increased the supply of narrow money aka M1 - which includes cash and money in bank accounts that can be spent immediately, from ₦22.47 trillion to ₦24.49 trillion, which means they printed ₦2.03 trillion, increasing the narrow money supply by a whopping 9.03% in one month - June. 🙆‍♂️

They increased the supply of broad money M3, which includes all money in the country, from ₦55.8 trillion to ₦64.9 trillion, which means they printed ₦9.1 trillion naira, increasing broad money supply by 16.31%, in one month. In other words, what they printed in June is 16.31% of all the money that the CBN had printed since independence. 🙆‍♂️

What does this mean? According to the CBN itself, "there is excess money supply when the amount of money in circulation is higher than the level of total output of the economy. When money supply exceeds the level the economy can efficiently absorb, it dislodges the stability of the price system, leading to inflation or higher prices of goods."

It also impacts the exchange rate; when more of a currency is printed, each unit of the currency becomes less valuable. A source I spoke to said that he suspects that the government has borrowed more money from the CBN. Trillions of naira. Inflation is 📈, naira is 📉.

Na our heads remain make them cut off make everywhere clear😂 Imagine that huge money, yet thing and the subsidy ain't right😔

Blue3k:


I did answered both questions.I said in the example all the money is spent nothing is saved. This means when more money is available more stuff is demanded. Remember how inflation was defined in previous comments. If you know what it is then you know it occurred when it happens. I defined as the increases as money supply itself. Other do it as increase it prices. Either way it's after its more money is added.

Hypothetical doesn't mean impossible. This scenario is possible. You can add other factors i mentioned but the results will be similar.

You didn't answer my questions. Can you show me were u answered my questions?

1. Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

2. For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

3. When did the inflation that you occured ocuur? Was it before money supply was increased or after?

4. A hypothesis is based on limited evidence. For it to be said to be possible, it must tested. What is your evidence and what test did u do that makes your hypothetical scenario possible?

5. What other factors are we adding? You gave a straight jacket claim...increase in money supply from N100 to N116 with 100 apples automatically caused inflation. What's there to add?

6. According to you "this means when more money is available more stuff is demanded".

"Available" where?

lexy2014:


You didn't answer my questions. Can you show me were u answered my questions?

1. Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

2. For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

3. When did the inflation that you occured ocuur? Was it before money supply was increased or after?

4. A hypothesis is based on limited evidence. For it to be said to be possible, it must tested. What is your evidence and what test did u do that makes your hypothetical scenario possible?

5. What other factors are we adding? You gave a straight jacket claim...increase in money supply from N100 to N116 with 100 apples automatically caused inflation. What's there to add?

6. According to you "this means when more money is available more stuff is demanded".

"Available" where?

You can look back yourself. The questions was answered. If you don't understand that's your fault.

1. You don't understand what purchasing power means. Demand is not the same as purchasing power. Yes demand increased but not purchasing power.

2. It's possible to spend all your new earnings. It's done all the time in the real world.

3. After the money supply increased.

4. We have historical examples of inflation of money supply causing inflation. Take 16th-century Spanish inflation due to the influx of new world gold. There's the example of this scenario playing out with hard money.

5. I said you can add the factors. You pick.

6. Yes.

Blue3k:


You can look back yourself. The questions was answered. If you don't understand that's your fault.

1. You don't understand what purchasing power means. Demand is not the same as purchasing power. Yes demand increased but not purchasing power.

2. It's possible to spend all your new earnings. It's done all the time in the real world.

3. After the money supply increased.

4. We have historical examples of inflation of money supply causing inflation. Take 16th-century Spanish inflation due to the influx of new world gold. There's the example of this scenario playing out with hard money.

5. I said you can add the factors. You pick.

6. Yes.

Who asked you if demand is d same thing as purchasing power?

1. Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

Simple yes or no


In the question below, who asked you if it is possible or not to spend all your new earnings?

2. For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

3. If u say inflation occured after money supply increase, how did that increase in money supply cause inflation?

4. Based on your 16th Spanish example, did the increase in gold and silver supply increase the purchasing power of Spaniards at d time?

5. What other factors are we adding? You gave a straight jacket claim...increase in money supply from N100 to N116 with 100 apples automatically caused inflation. What's there to add?

You said "yes" in your number 6. "Yes" to what exactly? What part of d question below required the "yes"?

6. According to you "this means when more money is available more stuff is demanded".

"Available" where?

lexy2014:


Who asked you if demand is d same thing as purchasing power?

1. Did the increase in the money in the economy from N100 to N116 automatically increase the spending/purchasing power of people?

Simple yes or no


In the question below, who asked you if it is possible or not to spend all your new earnings?

2. For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?

3. If u say inflation occured after money supply increase, how did that increase in money supply cause inflation?

4. Based on your 16th Spanish example, did the increase in gold and silver supply increase the purchasing power of Spaniards at d time?

5. What other factors are we adding? You gave a straight jacket claim...increase in money supply from N100 to N116 with 100 apples automatically caused inflation. What's there to add?

You said "yes" in your number 6. "Yes" to what exactly? What part of d question below required the "yes"?

6. According to you "this means when more money is available more stuff is demanded".

"Available" where?

1. Yes to demand. No to purchasing power. Learn the difference between the two it's important.

2. It's possible because it not impossible in the hypothetical scenario. The money was spent.

3. Refer to answer 2.

4. It led to a fall of the purchasing power of the money.

5. I told you can add other factors of your choosing. Make your choice instead asking me.

6. Money circulates in the economy and is earned. That's where it comes from.

Blue3k:


1. Yes to demand. No to purchasing power. Learn the difference between the two it's important.

2. It's possible because it not impossible in the hypothetical scenario. The money was spent.

3. Refer to answer 2.

4. It led to a fall of the purchasing power of the money.

5. I told you can add other factors of your choosing. Make your choice instead asking me.

6. Money circulates in the economy and is earned. That's where it comes from.

1. If the increase in money supply from N100 to N116 didn't increase purchasing power, how then did it increase demand?

2. Can u pls identify were money being spent or not spent was mentioned in the following:

"For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?"

3. How can I refer to 2 when I never asked you if money was spent or wasn't spent? Can you show where in number 2 I asked about money being spent?

4. How did the increase in supply of money in Spain cause the purchasing power of money to fall?

5. Why should I add any factors of my choosing? You are d one adding factors after making a straight jacket claim that increase in money supply from N100 to N116 with 100 apples automatically caused inflation. Why adding other factors when u claimed that it is increase in money supply that automatically caused inflation?

6. If you say money is earned in an economy, is it supply of money in the economy that determines how much people earn?

lexy2014:


1. If the increase in money supply from N100 to N116 didn't increase purchasing power, how then did it increase demand?

2. Can u pls identify were money being spent or not spent was mentioned in the following:

"For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?"

3. How can I refer to when I never asked you if money was spent or wasn't spent? Can you show where in number 2 I asked about money being spent?

4. How did the increase in supply of money in Spain cause the purchasing power of money to fall?

5. Why should I add any factors of my choosing? You are d one adding factors after making a straight jacket claim that increase in money supply from N100 to N116 with 100 apples automatically caused inflation. Why adding other factors when u claimed that it is increase in money supply that automatically caused inflation?

6. If you say money is earned in an economy, is it supply of money in the economy that determines how much people earn?

When the supply of anything increases while demand is constant then the value of that thing will drop and such things include money. When you print currency, the currency loses value. Ancient people that invented money understood this.

Blue3k:


Increasing the money supply without an aggregate increase in the supply of goods results in price levels going up. Since the amount of production didn't increase at the same rate the cost of goods go up. The graph shows how increasing money supple increases inflation in one scenario.

Assuming the economy is 100 apples and they are all 1 naira. The economy is 100 naira or apples. Assuming the money supple increased 16% the there's now 116 naira and still 100 apples in this example. The price inflation rate is 16%. You not wealthier because you still have 100 apples. Money has utility because ut buys goods and services. Do you get how adding money effects inflation?

Nice to have you back. Did you win the Nobel prize and forget us?

lexy2014:


1. If the increase in money supply from N100 to N116 didn't increase purchasing power, how then did it increase demand?

2. Can u pls identify were money being spent or not spent was mentioned in the following:

"For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?"

3. How can I refer to when I never asked you if money was spent or wasn't spent? Can you show where in number 2 I asked about money being spent?

4. How did the increase in supply of money in Spain cause the purchasing power of money to fall?

5. Why should I add any factors of my choosing? You are d one adding factors after making a straight jacket claim that increase in money supply from N100 to N116 with 100 apples automatically caused inflation. Why adding other factors when u claimed that it is increase in money supply that automatically caused inflation?

6. If you say money is earned in an economy, is it supply of money in the economy that determines how much people earn?

I hope you realize that Blue3k read economics, and probably abroad? He and Omohayek are square pegs in square holes when it comes to the subject. There's also 4 play but he's not very active.

lexy2014:


1. If the increase in money supply from N100 to N116 didn't increase purchasing power, how then did it increase demand?

2. Can u pls identify were money being spent or not spent was mentioned in the following:

"For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?"

3. How can I refer to when I never asked you if money was spent or wasn't spent? Can you show where in number 2 I asked about money being spent?

4. How did the increase in supply of money in Spain cause the purchasing power of money to fall?

5. Why should I add any factors of my choosing? You are d one adding factors after making a straight jacket claim that increase in money supply from N100 to N116 with 100 apples automatically caused inflation. Why adding other factors when u claimed that it is increase in money supply that automatically caused inflation?

6. If you say money is earned in an economy, is it supply of money in the economy that determines how much people earn?

1. Demand is desire and willingness to pay a specific price. Demand can be increased due to changes in income, preferences or future expectations. This why you don't need an increase in purchasing power to have higher demand.

2. You're free to read back. I mention it was spent. If you disagree say so.

3. Refer to answer two.

4. Inflation.

5. You don't have to. I said you can. Since you don't want don't worry about.

6. Over a long run period it will effect it. Under hyperinflation people in Zimbabwe earned billions when that was unheard a decade prior.

grandstar:


I hope you realize that Blue3k read economics, and probably abroad? He and Omohayek are square pegs in square holes when it comes to the subject. There's also 4 play but he's not very active.

I don't get it. Is that supposed to scare me or something? If he read economics, then d more reason for d questions I asked

lexy2014:


I don't get it. Is that supposed to scare me or something?

No. Rather, listen to them as they know what they are talking.

Blue3k:


1. Demand is desire and willingness to pay a specific price. Demand can be increased due to changes in income, preferences or future expectations. This why you don't need an increase in purchasing power to have higher demand.

2. You're free to read back. I mention it was spent. If you disagree say so.

3. Refer to answer two.

4. Inflation.

5. You don't have to. I said you can. Since you don't want don't worry about.

6. Over a long run period it will effect it. Under hyperinflation people in Zimbabwe earned billions when that was unheard a decade prior.

1. Bros, that's not what I asked you except u didn't understand d question. Earlier u claimed that increase in money supply from N100 to N116 increased demand. How did it increase demand?

Are u sure u understand this number 2 question?

2. Can u pls identify were money being spent or not spent was mentioned in the following:

"For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?"

3. How can I refer to 2 when I never asked you if money was spent or wasn't spent? Can you show where in number 2 I asked about money being spent?

4. How then did the increase in supply of money in Spain cause inflation which caused the purchasing power of money to fall?

5. It's not about me. It's about u. Why are You adding more factors after making a straight jacket claim that increase in money supply from N100 to N116 with 100 apples automatically caused inflation?

6. Based on your claim, are earnings of Nigerians going to rise since the CBN has increased money supply?

The key word is "earn" which you used earlier. Is it supply of money that determines a persons "earning"?

grandstar:


No. Rather, listen to them as they know what they are talking.

Listen to them in what way?

What is it that "they" are talking about that I should listen to?

Who are the "they" u are referring?

I am having discussion with just one individual. How does that now translate to "they"?

Seun:
Dear Nairalanders,

I regret to inform you that the Central Bank of Nigeria printed an alarming quantity of money electronically in June 2023 (source).

They increased the supply of narrow money aka M1 - which includes cash and money in bank accounts that can be spent immediately, from ₦22.47 trillion to ₦24.49 trillion, which means they printed ₦2.03 trillion, increasing the narrow money supply by a whopping 9.03% in one month - June. 🙆‍♂️

They increased the supply of broad money M3, which includes all money in the country, from ₦55.8 trillion to ₦64.9 trillion, which means they printed ₦9.1 trillion naira, increasing broad money supply by 16.31%, in one month. In other words, what they printed in June is 16.31% of all the money that the CBN had printed since independence. 🙆‍♂️

What does this mean? According to the CBN itself, "there is excess money supply when the amount of money in circulation is higher than the level of total output of the economy. When money supply exceeds the level the economy can efficiently absorb, it dislodges the stability of the price system, leading to inflation or higher prices of goods."

It also impacts the exchange rate; when more of a currency is printed, each unit of the currency becomes less valuable. A source I spoke to said that he suspects that the government has borrowed more money from the CBN. Trillions of naira. Inflation is 📈, naira is 📉.

Same idea Tinubu once aired to Buhari during Covid. The man definitely believes in printing of money to meet immediate obligations of govt not minding the inflationary consequences.

https://nairametrics.com/2020/03/29/covid-19-tinubu-asks-fg-to-print-more-naira-notes-outlines-economic-measures/

https://punchng.com/coronavirus-print-more-naira-notes-tinubu-tells-fg/

lexy2014:


1. Bros, that's not what I asked you except u didn't understand d question. Earlier u claimed that increase in money supply from N100 to N116 increased demand. How did it increase demand?

Are u sure u understand this number 2 question?

2. Can u pls identify were money being spent or not spent was mentioned in the following:

"For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?"

3. How can I refer to 2 when I never asked you if money was spent or wasn't spent? Can you show where in number 2 I asked about money being spent?

4. How then did the increase in supply of money in Spain cause inflation which caused the purchasing power of money to fall?

5. It's not about me. It's about u. Why are You adding more factors after making a straight jacket claim that increase in money supply from N100 to N116 with 100 apples automatically caused inflation?

6. Based on your claim, are earnings of Nigerians going to rise since the CBN has increased money supply?

The key word is "earn" which you used earlier. Is it supply of money that determines a persons "earning"?

1. I already mentioned the factors that increased demand.

2. I can but don't care to. If you're willing to pay I may change my mind.

3. Refer to previous answers. The money spent tell you about demand.

4. Inflation

5. Why are you worried about this still?

6. Over the long-run yes in nominal terms. Not in real terms.

Blue3k:


1. I already mentioned the factors that increased demand.

2. I can but don't care to. If you're willing to pay I may change my mind.

3. Refer to previous answers. The money spent tell you about demand.

4. Inflation

5. Why are you worried about this still?

6. Over the long-run yes in nominal terms. Not in real terms.

I. I didn't ask u for factors that increased demand. Earlier u claimed that increase in money supply from N100 to N116 increased demand. How did it increase demand?

Are u sure u understand this number 2 question?

If u say u can but u don't, then what brought money spent into number 2 question?

2. Can u pls identify were money being spent or not spent was mentioned in the following:

"For you to say that price of apple increased from N1 to N1.16 (after money supply increased) suggests that immediately money supply was increased, that automatically triggered the price of apple to increase. How was that possible?"

3. How can I refer to 2 when I never asked you if money was spent or wasn't spent? Can you show where in number 2 I asked about money being spent?


Are u sure read this question properly?

4. How then did the increase in supply of money in Spain cause inflation which caused the purchasing power of money to fall?

Why are u worried that am worried? Why don't u instead worry about d question?

5. It's not about me. It's about u. Why are You adding more factors after making a straight jacket claim that increase in money supply from N100 to N116 with 100 apples automatically caused inflation?

6. How then will money supply in the economy determine what a person will earn from his or her employer?.