The ZAR Exchange Rate Thread

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Thor187 said:
Lol you again.

Reality is against you.
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I'm fairly deep in the startup space. You're in school.
And you're trying to lecture me about how BEE negatively effects someone like me....
Spend less time on forums, study a bit more, and BEE won't effect your life
 
JStrike said:
I'm fairly deep in the startup space. You're in school.
And you're trying to lecture me about how BEE negatively effects someone like me....
Spend less time on forums, study a bit more, and BEE won't effect your life
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School, ai Okey oom. So your an isolated case and your going to change the landscape of the South African economy.

Goodluck hey, in 10 years this economy will still operate like this and you'll still be wrong.

Just because a weak rand benefits your small company individually does not mean it benefits our economy, because it doesn't. Don't believe me? Well then your a idiot to say the least, but just for interest sake look at the correlation between Rand and the JSE.
 
JStrike said:
I'm fairly deep in the startup space. You're in school.
And you're trying to lecture me about how BEE negatively effects someone like me....
Spend less time on forums, study a bit more, and BEE won't effect your life
Click to expand...

affect*, go back to school please.

Thor187 said:
School, ai Okey oom. So your an isolated case and your going to change the landscape of the South African economy.

Goodluck hey, in 10 years this economy will still operate like this and you'll still be wrong.

Just because a weak rand benefits your small company individually does not mean it benefits our economy, because it doesn't. Don't believe me? Well then your a idiot to say the least, but just for interest sake look at the correlation between Rand and the JSE.
Click to expand...

Actually a weak rand does benefit our economy since we export more than we import. The question is more how weak the rand is allowed to become before it collapses.
 
Johnatan56 said:
affect*, go back to school please.



Actually a weak rand does benefit our economy since we export more than we import. The question is more how weak the rand is allowed to become before it collapses.
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I agree with you we export more raw materials copper etc, but we have to buy the finished product back electronics etc (small example)

If we manufactured end products and exported that then I believe a weak rand will benefit us more
 
What does hurt for exports (Both goods and services) is exchange rate volatility (Both Rand, and more importantly, Euro), the skills base in SA, and the size of the domestic market.

So this translates to :
A more stable currency (There are a couple of theories about how to achieve that)
Better education, and more relevant education
Increase GDP per Capita in South Africa (Which is fairly high, but skewed by high gini coefficient. Which means that our market is quite small) while lowering our Gini coefficient. Or probably easier, to expand the size of the market by creating a Free Trade Area with our neighbours or even better, a common market.
Why the size of the domestic market matters for exports, is that it is massively beneficial to have a domestic market you can survive off, while sending surplus overseas (Or using exports to increase your revenue)
 
Thor187 said:
I agree with you we export more raw materials copper etc, but we have to buy the finished product back electronics etc (small example)

If we manufactured end products and exported that then I believe a weak rand will benefit us more
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There is a reason that countries artificially weaken their currencies. If you want to change the nature of your exports, it is necessary (Albeit not the only thing needed)
 
JStrike said:
There is a reason that countries artificially weaken their currencies. If you want to change the nature of your exports, it is necessary (Albeit not the only thing needed)
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BUT the point you fail to understand is that in SA we don't produce and export the finished goods they do. We export raw AND have to buy back the finished product.
 
Thor187 said:
BUT the point you fail to understand is that in SA we don't produce and export the finished goods they do. We export raw AND have to buy back the finished product.
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Yes. And to change that a weak and stable exchange rate is needed (Among other interventions). As you move up the development ladder, then a stronger currency is beneficial (As is happening with China now)
Read up on import substitution
 
JStrike said:
Yes. And to change that a weak and stable exchange rate is needed (Among other interventions). As you move up the development ladder, then a stronger currency is beneficial (As is happening with China now)
Read up on import substitution
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I understand the process, everything you say is true, BUT not in our current state, this country needs a government change before we can benefit from weaker rand and transform our economy, as the countries current situation a weak Rand is the last thing it needs especially considering the less purchasing power it gives consumers amongst other things.
 
Midnight_choir_drunk said:
I don't see how that is relevant. Nothing stopping entrepreneur minded South Africans from taking advantage of the competitive edge you have to manufacture here instead of importing. Most undervalued currency in the world remember.
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LOL perhaps if you can manufacture in the dark while your workers are striking.
 
Thor187 said:
I understand the process, everything you say is true, BUT not in our current state, this country needs a government change before we can benefit from weaker rand and transform our economy, as the countries current situation a weak Rand is the last thing it needs especially considering the less purchasing power it gives consumers amongst other things.
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The issue is how weak the Rand is, it is weakening more than what was planned due to e.g. Eskom power.
If it was a stable weak we wouldn't be having the issue with consumer purchasing power since salaries would match better.
 
Midnight_choir_drunk said:
I don't see how that is relevant. Nothing stopping entrepreneur minded South Africans from taking advantage of the competitive edge you have to manufacture here instead of importing. Most undervalued currency in the world remember.
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We've had this discussion before... it doesn't work like that...

Midnight_choir_drunk said:
Let's hope so. A strong rand is terrible for the economy.
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BS

Johnatan56 said:
Actually a weak rand does benefit our economy since we export more than we import. The question is more how weak the rand is allowed to become before it collapses.
Click to expand...
In terms of value we import more. THe rand should drop back to something like R6/$

JStrike said:
There is a reason that countries artificially weaken their currencies. If you want to change the nature of your exports, it is necessary (Albeit not the only thing needed)
Click to expand...
Yes but those countries that do that increase their exports first.
 
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Swa said:
Yes but those countries that do that increase their exports first.
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Or have the capability to do that. You're right. We're so fscked. It's like that scene from that "Saw" parody film, where the little Saw alien scratches his balls after being intimate with one of the women and says: "She said she's a virgin". The other Saw replies, "We're so fscked". And that's what's happening.
 
EEEK! Whats happening... R18.74 to the GBP.. the Dollar is seeing the same steep curve

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