Supply of money

L$190.4475/US$1.00 When a country prints new bills, they are usually meant to replace older damaged notes. It is the job of the Central Bank to collect the old bills and destroy them and infuse the new ones. If you do not replace defunct currency, but just adding to money supply, you undermine the currency. We saw this in the Weimar Republic in the 1920s. In Zimbabwe, Mugabwe thought he was smart and started printing money to be able to pay govenment employees. In Venezuela today, Madouru is doing the same thing. In the short term, you may seem to solve a problem, but very shortly after, the currency is soon not worth more than what it actually is, paper. At this stage, when a country issues more money than it has backing for, you get increased inflation. Inflation is the increasing of prices, or really the decreasing of the value of the currency. In Weimar, Zimbabwe and Venezuela the printing of "new" money just kept on and on. This caused HYPERINFLATION. In the end, to buy a loaf of bread, the equivalent amount of money had to be carried in a wheelbarrow. Luckily, we are not here yet, but the tendencies seem to be ther. Wake up now, and smell the coffee.

Another one gets a bank

L$189.4508/US$1.00 Lo and behold. The Central Bank of Liberia has allegedly inflated its payroll by almost 300 people. For what? Are we going back to becoming a banana republic?

Supply and demand

L$187.6225/US$1.00 The more demand for any product, the more will be the price of it. The less the supply of something, the more the price. These are the two major facts in economic theory. The important lesson here is that to solve the problem you have to supply more of the scarce product. Or find a way to decrease the demand of the scarce product. There is unfortunately no piece of legislation that can do anything about this. Solution: Find a way to make the flow of US dollars into the country increase. Produce things that can be sold abroad to bring in foreign currency.

Our neighbor

L$182.6281/US$1.00 Meanwhile in Sierra Leone. After eleven months in office, the new Sierra Leonean president has put measures in place to encourage a boost in agriculture. They have also implemented a central govenment account for the collection of revenue. These measures have gained approval from the IMF and World Bank. Things are looking up for our neighbors, for us, not so much. We are concentrating on building mansions for ourselves.

One, two, three

L$172.5305/US$1.00 One, two, three.

In this day and age

L$177.8284/US$1.00 In this day and age we are still writing checks? An employee of the Revenue Authority has managed to cash a check for USD 450 000 and make off with the amount. Are we surprised?