Repo rate cut by 50bps

STORMERSFAN said:
Is now a good time to to buy a place?will rates go any lower and how quickly will it go up again?
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It will go back up but no one knows when. It depends on too many unknown factors which our brain dead, ruling elite could screw up.
For example if SARB started printing money like Zimbabwe or Venezuela did then we'll quickly get ourselves into a hyper-inflation situation and the interest rates will join the upward march.
Zimbabwe’s central bank raised its main interest rate to 70% at one point to try to rein in their inflation.
 
Techne said:
I.e. getting unearned income. Nope, don't feel sorry for them.
To be clear, there is a difference between saving money and getting interest just to keep up with inflation (unfortunate by-product of a parasitic financial system) and investing money just to earn interest as an income. The latter parasites can get rekt, hopefully the former don't lose.
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Bit short of understanding ....

What about people who have either retired or maybe have been paid out from insurance for a medical issue?
Or an NPO maybe?
Alot of these folk choose to put their cash into call accounts or maximer accounts ....

They arent parasites ......
 
Techne said:
I.e. getting unearned income. Nope, don't feel sorry for them.
To be clear, there is a difference between saving money and getting interest just to keep up with inflation (unfortunate by-product of a parasitic financial system) and investing money just to earn interest as an income. The latter parasites can get rekt, hopefully the former don't lose.
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Actually, the really rich people don't really touch bank interest. And you can only earn interest on money you have earned to deposit.

Lets put it another way. What do you invest in?
 
Superman-7 said:
Unfortunately those in debt outnumber the savers by a country mile. It makes sense that way.
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Basically the traditional banking system works in two ways. They loan money to people to buy houses and stuff - at a higher interest rate than they give to those who have earned some money and deposit if for savings interest.

Or they loan from the government/reserve bank (the repo rate) to loan to others.
 
Messugga said:
Only if your investments are based on receiving interest.
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Absolutely. But, market linked investments also took a severe knock lately.

The traditional model is you are in volatile investment markets while you are young to middle-age-ish. Then when you are retiring you want to be in something more secure. As in more cash based.
 
Techne said:
Can we just move to deflation now please. Good for the real economy and working people, bad for the banks and debt financial sector... but those parasites can get rekt.
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And the retired who spent their lives supporting the economy gets ****ed.
 
Techne said:
Can we just move to deflation now please. Good for the real economy and working people, bad for the banks and debt financial sector... but those parasites can get rekt.
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I wholly disagree, deflation is a disaster for everybody. Fortunately our inflation rate is still a long way off from this, if anything, lowered interest rates will put some form of upward pressure on prices.
 
Hamster said:
And the retired who spent their lives supporting the economy gets ****ed.
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Just about everybody supports a financial system that is totally unjust and parasitic. It is sad and bad news for the retired to suffer the consequences of such a system.
 
Speedster said:
I wholly disagree, deflation is a disaster for everybody. Fortunately our inflation rate is still a long way off from this, if anything, lowered interest rates will put some form of upward pressure on prices.
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If true then higher and lower interest rates put upward pressure on prices. That will be just more evidence of how stupid the current system is.
 
Techne said:
If true then higher and lower interest rates put upward pressure on prices. That will be just more evidence of how stupid the current system is.
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Higher interest rates put downward pressure on prices - this is economics 101.

Could you give one potential benefit of deflation?
 
Speedster said:
Could you give one potential benefit of deflation?
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It's going to be easier for somebody to take this liability house off my hands.

And my cars etc are gonna get paid off real quick.

After that I don't know :(
 
So now repo is close to 1/2 of prime.. this is getting close to being bad for the banks in terms of marketing. If there is another drop and prime difference doesnt change there will be a start of political shenanigans drama vs banks if it doesnt start soon already.. same time banks should see investments as they maintain a high margin.

I dunno.. i think the prime rate differential is a bit problematic. Not sure which is better to reduce though.. given the choice? which is lesser pain for investors?
 
Funny how every now and then (now for smaller businesses) a few clowns say SA does not "save" enough. Now why would you save with a falling interest rate, devaluing currency and tax payable on interest earned? Go borrow money and buy ****!
 
NarrowBandFtw said:
Keynesian nonsense, care to provide proof of deflation ever being bad in the history of man?

NB: leave the great depression out of it, deflation was the effect, not the cause
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Because people stop spending. Economy grinds to a halt.
Why buy something now when it will be cheaper next week?
Then come annual increase time, your increase is inflation linked? Welcome to your decrease.
 
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