So is this the economic turning point...

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LancelotSA

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Well just heard the news on the radio that the petrol price may come down next month due to a strong rand and a drop in oil prices... this could have a knock on effect resulting in inflation slowing... which in turn could lead to the reserve bank not having to raise interest rates when they next meet....

Is this the point at which the markets turn or is it just false hope...? :)

Let's hope it is the former!
 
Not a chance made. Notice the world economy getting better? Nope.. did not think so. The problem with speculation buying and lack of sufficient production from OPEC countries to meet growing demand has not changed.
 
w1z4rd said:
Not a chance made. Notice the world economy getting better? Nope.. did not think so. The problem with speculation buying and lack of sufficient production from OPEC countries to meet growing demand has not changed.
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Um, not sure it is really something you "notice" in passing... you rather need to have a look at a few key indicators to see where we are heading... I also did not claim a major about turn but rather a start.

According to your logic we will never have a turn in the economy as oil production going forward is never going to meet demand. By most people's calculations we have passed peak production and are heading downhill.

Some more info on that petrol/oil price... http://www.fin24.com/articles/default/display_article.aspx?Nav=ns&ArticleID=1518-25_2354412
 
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LancelotSA said:
Um, not sure it is really something you "notice" in passing... you rather need to have a look at a few key indicators to see where we are heading... I also did not claim a major about turn but rather a start.

According to your logic we will never have a turn in the economy as oil production going forward is never going to meet demand. By most people's calculations we have passed peak production and are heading downhill.
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Yurre... you really do jump to abstract conclusions.

No.. I imagine as our dependency on oil slows down ( http://hardware.slashdot.org/article.pl?sid=08/07/08/2024246 ) Things will possibly look better.
 
w1z4rd said:
Yurre... you really do jump to abstract conclusions.

No.. I imagine as our dependency on oil slows down ( http://hardware.slashdot.org/article.pl?sid=08/07/08/2024246 ) Things will possibly look better.
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Which was the abstract conclusion?

Aha ok from your link I see what you assume was an "abstract" conclusion by me... so then let me draw one that you will not try to insult by calling abstract... so you feel economies will not turn until at least 2015?
 
Oil price is still going up.
This "drop" is probably more attributable to a weaker dollar (and hence "stronger" rand) than any bettering of economic prospects.
What is most worrying is the on-going calls for oil to be priced in Euros - and the rand is mighty weak on that side.
 
I thought there was a 6 month buffer between market conditions in oil and its effect locally?
 
icyrus said:
I thought there was a 6 month buffer between market conditions in oil and its effect locally?
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If you read the link I provided it explains that the under/over recovery in fuel price feeds into the system from month to month. So it is virtually immediate.
 
LancelotSA said:
Which was the abstract conclusion?

Aha ok from your link I see what you assume was an "abstract" conclusion by me... so then let me draw one that you will not try to insult by calling abstract... so you feel economies will not turn until at least 2015?
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Dude you seriously need to take that fuse out of your tampon... <==--- now thats an insult. The other was merely a comment and not an insult... but you couldnt let that melodramatic award go there.. could you?

Anyways. No.. why would I base my time purely on what mercedes is doing? Again.. an abstract conclusion from you. Necessity is the mother of all innovation, and thats exactly what we are see`ing around the world now as crude oil prices continue to climb.

I would think... recovery... or at least the start of it... 2011+

And I am choosing that date simply because I dont see any quick solution for the price of oil or the world food shortage... and no.. its not a "fixed in stone" (tm) date.
 
To be quite honest, as long as the petrol price does come down. That makes me happy, not all that concerned as to why.
 
LancelotSA said:
If you read the link I provided it explains that the under/over recovery in fuel price feeds into the system from month to month. So it is virtually immediate.
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The two are not synonymous though.
The under/over recovery is based on sales and costs - nowhere is it said that the costs are from last month.
 
Linoman said:
To be quite honest, as long as the petrol price does come down. That makes me happy, not all that concerned as to why.
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Yip, this was my view too. But some people just seem unable to see that silver lining! :)

And as an added bonus of the reserve bank decides not to increase interest rates further I am smiling even more... that sounds like a recovery in my little economy! ;)
 
The petrol price will never come down.

Independency from oil is the only way.
 
Northern hemishere heading to winter, so uhm u havmd to hope they stocked up already or prices will rise as their energy demand goes up. Euro oil price, nice the US will whine. Kinda ironic how iran wanted nuclear power to reduce their own dependance on fuels and now the are timelines for oil reserves.
 
krycor said:
Northern hemishere heading to winter, so uhm u havmd to hope they stocked up already or prices will rise as their energy demand goes up.
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I have already filled up my heating oil tank in february. (3000 liter)
And I am also firing wood for heating.

It will be enough for 1-2 years depending on winter coldness.

Lets hope the global warming prevents us from strong winter days. :D
 
I dont think it will be the key turning point but it is good news nonetheless. There was talk of SARB not increasing interest rates already, before this spot of good news, but not necessarily for the right reasons. This might be a step in the right direction for them to make the decision for the right reasons at least. Oil is still too volatile to expect it to hold at its current levels though.

I reckon the key indicator is no longer CPI but PPI for the next meeting. It should indicate corporate SA's long term expectations of the economy.
 
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