The Monetary Policies Of The Government

1976 Words8 Pages
The monetary policies of the government are not formulated to stabilize the economy and create trust; they are created to ensure that the regimes’ coffers are the main beneficiary, most of the times, the only beneficiary. That policy has created an almost dead Eritrean economy resulting in unemployment, poverty and frozen assets, the symptoms of bad management of money supply and the underlying problems associated with general monetary planning. Facing severe dilipadating consequences, the PFDJ is entangles in resolving the symptoms without attending to the root causes. It is with this in the background that we have to see the recent decision by the Eritrean government to change the old Nakfa bills with a new print. Financial transactions have come a long way since the ancient times; people do not carry sacks of barley or slabs of salt as a currency for transactions. The Sumerians introduced one of the first coins, long before people began to store their wealth in gold, silver and other metal ingots. At the same time, many underdeveloped societies stored their wealth in livestock, weapons, and metal armlets. With the introduction of paper money, moving currency became an easier task provided the authority that issues the paper currency trustworthy. In the 21 century, we have moved fast into plastic money, digital money and even Bitcon, which might destroy the entire notion of central banks in the future. In ancient times, Eritrea has seen Greek, Byzantine, and other coins.
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