End of rate hikes?

[GavinMannion]

Yeah my wife who is a housewife has been offered credit cards from

ABSA - R30 000
Standard - R25 000
Nedbank - R40 000
BlueBean (STD again) - R20 000

and some other no name brands. They even have the audacity to say she is pre-approved. Funny that last time when we actually pretended to play along they panicked when they realised she had no money at all and could not pay it back.

ABSA asked her how much of an allowance I give her which they can then use as income.... Idiots.

 

[Bageloo]

Yeah my wife who is a housewife has been offered credit cards from

ABSA - R30 000
Standard - R25 000
Nedbank - R40 000
BlueBean (STD again) - R20 000

and some other no name brands. They even have the audacity to say she is pre-approved. Funny that last time when we actually pretended to play along they panicked when they realised she had no money at all and could not pay it back.

ABSA asked her how much of an allowance I give her which they can then use as income.... Idiots.

credit granted based on an allowance ! that's insane. might as well get my 2 yr old son a credit card, he also gets an allowance for tuck money.

 

[willirob]

its pretty scary that they offer that sort of credit to anyone - whats the monthly minimum payment on R40000, must be 4 or 5k.

So for house + car + CC you probably looking at about 20k - and thats before beer.

Is it really that common these days to earn over 30k/month?

 

[GavinMannion]

Must be, I have been having the same thought.....

I thought R20 000+ a month was a very very good salary, doesn't seem to be anymore..

To earn over R30 000 p/m you need an annual salary over R500 000. I saw a senior IT manager positions advertised the other day for R480 000. So where are all these R500 000+ jobs?

 

[willirob]

.gov.za

 

[GavinMannion]

Those where gov jobs. I actually specifically picked them to counter the obvious answer that someone was going to post..

Next answer please?

 

[nthdimension]

And for the average person a decent home had become very nearly unaffordable. Increases in the interest rate makes it even more difficult, and it eats into money that should otherwise be used on consumption to drive the economy.

There aren't many jobs that pay that much. Mostly people in certain professions and in certain financial jobs.

 

[Sneeky]

Baas Tito is getting mighty peeved with the banks and a while back said he would look at ammending cetain conditions between the lending institutions and the Reserve Bank if they dont pull their necks in.

A good overview from Rob Rose.
Card frenzy sends debt to dizzy R37bn peak
http://www.businessday.co.za/articles/topstories.aspx?ID=BD4A346481

 

[Bageloo]

Those where gov jobs. I actually specifically picked them to counter the obvious answer that someone was going to post..

Next answer please?

very few +R500 000 jobs get advertised in the open market. Most of them are internal movements. So, for such a job look no further than within your own company (mostly senior managers),

 

[Lord Anubis]

In 1997/98 interest rate hikes nearly drove a lot of people to suicide. I remember that it jumped from 12% to like 22% in the space of a year. A lot of people lost homes, cars etc and a lot of people divorced etc. It was very bad. I had to downsize my own company during all this (I employed six people) and besides loosing 2 employees I had to sell off three work vehicles. By 1999 it was over but a lot of people are still stuffed from back then. For example an ex business partner of mine has been maintaining, loans, credit card(s) and over draft(S) of over R650 000 since then and just can get it paid up. I however eventually sold my business, broke completely even after SARS had their pound of flrsh and now have a Snr Management job. But don't be fooled, as things stand not even earning R60 000 a month is enough if you want acomfortable house and say two new(ish) cars and have kids etc etc. Rates are even worse when you have a home of say R3 mil and two cars with loan value of a R500K each. After tax that R60 000 is only about R40K which means that most Execs are looking for Salaries over R100k per month just to have a "normal/comfortable" life and are k@king like the rest of us.

BTW in America and UK people are even worse off in debt. Most people are more than 4 x their annual salaries (before tax) in debt. Credit is an evil k@k thing. That's why I never take a loan or make any debt. If I can't buy it cash I don't ...even cars. I'd rather save up for three years up than pay a bank for five years and end up paying double.

 

[Paulr]

Once again, Zapiro hits the nail on the head.

 

[RompelStompel]

Credit demand 'shocker'

http://www.fin24.co.za/articles/default/display_article.aspx?Nav=ns&ArticleID=1518-25_2049776

Johannesburg - Demand for credit by South Africa's private sector slowed to 26.77% in the year to November from a record 27.48% in October, central bank data showed on Friday.

During the same period, the broadly defined M3 measure of money supply grew by 25.33% from 23.51% in October.

Consensus forecasts in a Reuters survey of five economists showed that private sector credit demand, which has helped drive a consumer spending boom, was likely to rise by 26.4% year-on-year.

Annual growth in M3 was expected to expand at an annual rate of 24.4% during November.

"It's worse than expected. It clearly shows that the private sector is borrowing as if it's never borrowed before," said George Glynos, economist at Econometrix Treasury Management.

"It's unfortunate that it's growing this rapidly because we think it forces the Reserve Bank's hand to some extent. We still hold the view that the SARB (South African Reserve Bank) may need to hike rates one last time in February by 50 basis points."

The central bank has raised the repo rate by 200 basis points to 9% in four stages since June, and meets again in February to determine the next move.

Faster growth in Africa's biggest economy has been driven largely by domestic demand, but spending has pushed household debt to a record 73% of disposable income, adding to inflationary pressures.

South Africa's Reserve Bank Governor Tito Mboweni has warned that debt levels are "worrying", referring to the way in which banks dole out credit cards as "madness that needs to be stopped".