Consumers are in serious trouble

[*SynergyX*]

go to a shopping mall on any given weekend...consumers look just fine.

 

[Lupus]

that figure was over 80% just before the financial crisis, since then interest rates have come down significantly and yet people continue to consume debt as opposed to settling it

so Ho3n3r's suggestion that a drop in interest rates will lead to people deleveraging is highly unlikely to occur given the data to date

So by your logic it doesn't work. But you then say it was at 80% at one stage and it's lower now? So how is it that it's not working if it's gone done by 5%? So when the interest rate was high it was 80% defaulting, now that it's a bit lower only 75% is defaulting? So logically dropping the interest rate would therefore drop the people defaulting? Maybe it's not a cause/correlation type thing.

 

[saturnz]

So by your logic it doesn't work. But you then say it was at 80% at one stage and it's lower now? So how is it that it's not working if it's gone done by 5%? So when the interest rate was high it was 80% defaulting, now that it's a bit lower only 75% is defaulting? So logically dropping the interest rate would therefore drop the people defaulting? Maybe it's not a cause/correlation type thing.

so let me get this straight

according to your "logic" the figures 75% and 80% refer to defaulters?

am I right or wrong in thinking that? because you refer to defaulters several times in your post even though I wasn't referring to defaulters

 

[Lupus]

so let me get this straight

according to your "logic" the figures 75% and 80% refer to defaulters?

am I right or wrong in thinking that? because you refer to defaulters several times in your post even though I wasn't referring to defaulters

My apologies, for some reason I thought it was people defaulting. But it's how much they are actually paying servicing debt.

Though looking into it, if they were paying 80% of their salaries servicing debt before the interest rate drops and now they are paying 75%? Isn't it still a drop?

 

[NarrowBandFtw]

then come up with stats that will stand the test of peer review

I actually don't believe for a single second it is even difficult. Did the digging on StatsSA's site a while back to understand their method, came across the list of crap in their inflation basket and it is a long list and in no way represents reality and while they're not all that clear about the weightings assigned to each item I'm sure it isn't realistic either.

Given that we have no public transport worth relying on, the price of fuel should actually carry a big weighting for a start, as for the rest: retire the godawful long list of irrelevant products and bring it into the 21st century. They can start by looking at Checkers' new mini-product collection promo, that's a list of 29 very current products that is much more popular than the official inflation basket list.

 

[saturnz]

I actually don't believe for a single second it is even difficult. Did the digging on StatsSA's site a while back to understand their method, came across the list of crap in their inflation basket and it is a long list and in no way represents reality and while they're not all that clear about the weightings assigned to each item I'm sure it isn't realistic either.

Given that we have no public transport worth relying on the price of fuel should actually carry a big weighting for a start, as for the rest, retire the godawful long list of irrelevant products and bring it into the 21st century. They can start by looking at Checkers' new mini-product collection promo, that's a list of 29 very current products that is much more popular than the office inflation basket list.

the reserve bank which is an independent institution questioned SARS trade statistics for years, until SARS eventually changed their methodology a few years ago

the reserve bank uses STATSSA inflation figures with very little in the way of disagreement as to the methodology used

so I guess we have to assume the reserve bank is not independent and are also in cohorts with STATSSA

 

[Ho3n3r]

]It never works that way, the lower the rates the more banks will have to lend to keep making the same profits. Lower rates will inevitably cause more reckless lending, not less and increased regulation will not stop that, only delay it perhaps.

Exactly. Blame the greedy banks, they're getting us ****ed.

 

[Ho3n3r]

People get themselves into debt voluntarily.

Are you saying I'm not allowed to have a house and a car? That's my only debt.

 

[saturnz]

My apologies, for some reason I thought it was people defaulting. But it's how much they are actually paying servicing debt.

Though looking into it, if they were paying 80% of their salaries servicing debt before the interest rate drops and now they are paying 75%? Isn't it still a drop?

you not really looking into to it, you just trying to prove the point I made wrong

let me look into the numbers though

the interest rate at the height of the financial crisis in SA hit a high of 12% and has dropped to 7% now according to this site

http://liberta.co.za/blog/repo-interest-rate-in-south-africa-current-and-historical/

that's a decrease in the interest rate over that period of 41% versus a drop of around 5% in debt to income ratio

see the problem?

 

[NarrowBandFtw]

so I guess we have to assume the reserve bank is not independent and are also in cohorts with STATSSA

Is there even any doubt?!? :wtf:

The reserve bank governor consults the minister of finance regularly. The reserve bank governor, the finance minister and the statistician-general are all appointed by el presidente, his holy excellency, mighty zumatello the 1st.

Independent? :crylaugh:

 

[Zoomzoom]

Don't spend what you don't have. Simple.

 

[saturnz]

Is there even any doubt?!? :wtf:

The reserve bank governor consults the minister of finance regularly. The reserve bank governor, the finance minister and the statistician-general are all appointed by el presidente, his holy excellency, mighty zumatello the 1st.

Independent? :crylaugh:

so then by that logic the reserve bank and finance minister and statssa are equally corrupt and yet people continue to buy our government bonds

when Argentina's official stats was questioned have a look at what happened with their government bonds, also there was alternative stats people could refer to. Also the lack of credibility of the official stats was widely publicised, even China's stats are widely discussed as questionable.

I do not see similar discussions around our statistics.

the resbank consults with the minister of finance to ensure that the policies do not work against each other, this is consistent with sound overall economic policy and happens in most countries

edit: heres a paper actually encouraging fiscal and monetary institutions to formalise their engagements

https://www.imf.org/external/pubs/ft/tnm/2012/tnm1202.pdf

 

[NarrowBandFtw]

when Argentina's official stats was questioned have a look at what happened with their government bonds, also there was alternative stats people could refer to. Also the lack of credibility of the official stats was widely publicised, even China's stats are widely discussed as questionable

I didn't claim it doesn't happen elsewhere, hell it is a global phenomenon, US inflation figures are also highly suspect.

I do not see similar discussions around our statistics

That's because South Africa is insignificant on the global stage.

the resbank consults with the minister of finance to ensure that the policies do not work against each other, this is consistent with sound overall economic policy and happens in most countries

In most countries there isn't a blatantly corrupt administration running the show:
Is the NPA independent when they'd rather go to the constitutional court to protect Zuma than prosecute him?
Is SARS independent when they refuse to go after Zuma's tax affairs and go after Pravin instead?
Is SAPS independent if they defend Zuma's raping of the treasury in a report that claims he's not liable?
Is the treasury independent when months after making bold promises about reeling in under performing SOE's the SAA CEO and SABC COO are still in place?

Given the extent of the corruption there is no reason whatsoever to believe the reserve bank or StatsSA are unaffected, especially when the government has a real incentive to pretend prices are not going up that much. Hell these days it seems pretty much the only independence that still exists is the ConCourt and the Public Protector and you can bet your last cent that Zupta has plans for them too.

 

[saturnz]

I didn't claim it doesn't happen elsewhere, hell it is a global phenomenon, US inflation figures are also highly suspect.

That's because South Africa is insignificant on the global stage.

In most countries there isn't a blatantly corrupt administration running the show:
Is the NPA independent when they'd rather go to the constitutional court to protect Zuma than prosecute him?
Is SARS independent when they refuse to go after Zuma's tax affairs and go after Pravin instead?
Is SAPS independent if they defend Zuma's raping of the treasury in a report that claims he's not liable?
Is the treasury independent when months after making bold promises about reeling in under performing SOE's the SAA CEO and SABC COO are still in place?

Given the extent of the corruption there is no reason whatsoever to believe the reserve bank or StatsSA are unaffected, especially when the government has a real incentive to pretend prices are not going up that much otherwise. Hell these days it seems pretty much the only independence that still exists is the ConCourt and the Public Protector and you can bet your last cent that Zupta has plans for them too.

LOL, in most countries their is blatant corruption- UK, US, Russia, India, China all spring to mind, their levels of corruption are far beyond what we have accomplished

Argentina is also not a significant country yet the issues around its stats was widely discussed and publicised

Edit: also the confidence investors have in a government is easily expressed in the demand for the bonds of said government, I urge you to look at the pricing of government bonds to see if investors with huge amounts of money agree with your view that the stats are comprised

 

[NarrowBandFtw]

LOL, in most countries their is blatant corruption- UK, US, Russia, India, China all spring to mind, their levels of corruption are far beyond what we have accomplished

Not blatant corruption no, while there is undoubtedly far more corruption in those countries it is not blatant, we are among the most blatant, in your face, of them all. How many countries have the questionable honour of saying their president got caught with his pants down and was found guilty by the highest court in the land, yet he still has his job and he basically told the entire nation to GFY?

At least they have the good sense to hide their corruption instead of flaunting it.

Argentina is also not a significant country yet the issues around its stats was widely discussed and publicised

Argentina's economy is about double the size of ours, so it is twice as significant.

Edit: also the confidence investors have in a government is easily expressed in the demand for the bonds of said government, I urge you to look at the pricing of government bonds to see if investors with huge amounts of money agree with your view that the stats are comprised

Bonds mean nothing. The US has sold them with negative yields and yet it is still gobbled up, why? Because of confidence or because it might be the less sharp of the falling knives to catch? When the world's largest economies offer you varying degrees of losing your money you may well choose to risk it on a country that is entirely corrupt, but offering a positive yield.

 

[hawker]

Well, luckily petrols coming down, and we all know that means food prices will come down

Funny one.

 

[saturnz]

Bonds mean nothing. The US has sold them with negative yields and yet it is still gobbled up, why? Because of confidence or because it might be the less sharp of the falling knives to catch? When the world's largest economies offer you varying degrees of losing your money you may well choose to risk it on a country that is entirely corrupt, but offering a positive yield.

I await your alternative statistics to our official statistics, no point saying they are wrong when you only provide very weak anecdotal evidence, these other issues really are not contributing to the original point.

In terms of blatant corruption, either Trump (Taxes?) or Hillary (emails?) will win the election, both are corrupt.

 

[NarrowBandFtw]

I await your alternative statistics to our official statistics, no point saying they are wrong when you only provide very weak anecdotal evidence, these other issues really are not contributing to the original point.

As a consumer with a brain you can tell the truth from the fiction, no stats needed, but if you must:
http://www.fin24.com/Economy/breaking-sa-inflation-drops-by-almost-1-20160420
http://www.fin24.com/Economy/sa-sees-surprise-drop-in-inflation-20160622
http://mybroadband.co.za/news/business/172370-prices-in-south-africa-1995-versus-2016.html
http://www.econrsa.org/publications/research-briefs/inflation-south-africa-assessment-alternative-inflation-models

In terms of blatant corruption, either Trump (Taxes?) or Hillary (emails?) will win the election, both are corrupt.

Still less blatant than Zuma, although the ease with which the email scandal has been made to go away was very in-your-face yes.

 

[saturnz]

As a consumer with a brain you can tell the truth from the fiction, no stats needed, but if you must:
http://www.fin24.com/Economy/breaking-sa-inflation-drops-by-almost-1-20160420
http://www.fin24.com/Economy/sa-sees-surprise-drop-in-inflation-20160622
http://mybroadband.co.za/news/business/172370-prices-in-south-africa-1995-versus-2016.html
http://www.econrsa.org/publications/research-briefs/inflation-south-africa-assessment-alternative-inflation-models

none of those references suggest there is anything wrong with the official stats, but that was just a cursory browse from my side

if you say the official stats are BS, you have to provide alternative stats, that's how it works and besides you said it would be easy to do, you would think someone would have done it by now if it was that easy

 

[Drifter]

For every statistic there is another that proves the opposite.