My niece SMS-ed me last weekend, something really raised my eye-brow, with smile. This is her SMS (translated from Bahasa Indonesia) :

“Uncle, my teacher asked me in the class, on how to get Indonesia twice richer than now… in a fast way. Please help… SOS.”

What a teacher, what a question! My niece is only 11 years old for God’s sake. I called her, and tried to answer the question this way:

“To double the wealth of Indonesia quickly, you can go several ways. One is halving the population so that all money and wealth and resources will be only for 120 million people (instead of 240 million); two is sell one or two islands to repay our debts.

None of the two is doable. So, what our government can do is to increase the value of our currency, to double-increase our rupiah, so that our wealth (GDP) will double. For example, our total GDP is now exceeding Rp. 10,000 trillion, equals to US$ 1.1 trillion. Imagine, if we can increase the value of our rupiah to Rp. 5,000 per USD, our GDP will be US$ 2.2 trillion. That’s far above Brazil’s GDP.

Lemme give you one more example of how lucky to have a much higher currency rate.

You have Rp. 1,000,000. With the current value ($100), you cant do much with it. But if we double the value, (Rp. Rp.5,000 = $1 ), you will have $200 in your hand. pretty much enough to go Jakarta-Bangkok-Jakarta with a decent airline. –

I hope you got it.”This morning, she SMS-ed me, and said that the teacher took sometime to understand her explanation. Well, doubling the value of currency is not the easiest way to do, but it is the easiest way for you to explain to a little kid.

Have a nice day.