Economic Depression, Which way; Fiscal Policy or Monetary Policy.When regional government came in 1954, Nigerians were empowered to open more banks. The unfortunate thing was that most of the banks went under not too long after they were established.The reasons for their demise were;Inadequate CapitalFierce competition with the British BanksRapid expansion within a short period of operationIncompetence and poor managementNo legislation to regulate the banks However, in 1954 the Central bank of Nigeria was established as a corporate body to be a banker and financial adviser of the government and its mandate includes; The regulation of banking business in Nigeria; To ensure monetary and price stabilityTo maintain external reserves to safeguard the international value of the legal tender currencyTo promote a sound financial system in Nigeria which are enshrined in Section 2 CBN Act 2007 Cap C4 Law of Federal Republic of Nigeria. After the independence in 1960, there was an upsurge in establishment of banks in Nigeria. During the oil boom in the 1970s, there were increase activities in Nigeria which led to establishment of more banks. And after the promulgation of Enterprise Promotion Decree (NEPD) in 1973, the Federal Government of Nigeria acquired 40% interest in the three largest banks namely; Standard Bank now First Bank Barclay Bank now Union Bank andThe United Bank for Africa now UBAIn 1977, the Federal Government increased the interest in these banks to 60%. The rationale behind that was to discourage those foreign banks to striveToday 2016, with the level of economic depression in Nigeria owing to the low priced of Crude Oil in Nigeria which had in recent years become the major source of the countrys revenue it has become imperative that the source of revenue for the country have to shift to the non-oil sector, but the major question is how do we solve the problem of inflation, the deteriorating economy and the hardship suffered by the people.The fundamental issue should be, can the policy makers use the theory of short-run economic fluctuations developed by the various schools of thought. And using this will give rise to two questions.Should monetary and fiscal policy take an active role in trying to stabilize the economy or should it be left to be resolve by the free Market?Should policy makers be free to use their decisions in responding to changing economic conditions or should they be committed to follow the policy rule?Economists use the term Stabilization Policy to mean policy actions aimed at reducing the severity of short-run economic fluctuations. Macroeconomic policy should aim at stabilizing the economy when it is overheated. But economist like Milton Friedman, born in 1932, to recently emigrated Jewish parents, whose theories of government deregulation provided the intellectual basis for the governments of Ronald Regan and Margret Thatcher in the UK, viewed the economy as usually stable. He blamed bad economic policies for the large and insufficient fluctuations we have sometimes experienced over the years, like this one of 2016 in Nigeria. He argued that economic policy makers should admit their limited activities and be satisfied if they did no