Bumped into Cyril from the Free Market Foundation at Wits University yesterday. We had a brief discussion on Hayek and Keynes before our respective presentations began. He started down the “hyperinflation here we come argument” when I asked whether he knew that US wages had declined last month. He asked “nominal?” with a genuine look…
This just shows how much nobody wants to spend cash. BNY Mellon Deposit Fee: Life in the Liquidity Trap Using the old quantity theory of money, this shows the massive decline in V for Velocity of money, showing why core prices are not rising even as the money supply is increased.
So Swaziland is in a whole heap of economic and political trouble; South Africa’s loan isn’t going to change any of that in the long run. The way the global economy looks at the moment, there’s no particular reason to think that the SA economy is going to be anything better than stagnant over the…
Swaziland vs Greece? More like Swaziland and Greece: Linked to a currency they can’t control Potentially devastating consequences if they devalue their currency and move away from the peg Fiscal irresponsibility A small country relative to their economic neighbors Except Swaziland has a dictator in charge and gets a bail-out without serious conditions and at…
If the SA Reserve Bank is the entity that made the loan, why did it do so? It’s mandate is currently inflation targeting. The “private shareholders” have no interest in lending money to Swaziland at a 5.5% coupon (a real yield of 1% to a country in desperate financial struggles). No Mr Gordhan, you should…
I don’t know that one can argue categorically for or against the loan to Swaziland. Yes, there are plenty of bad things going on in Swaziland and I’ve blogged about them before. On the other hand, the citizens of Swaziland will also hopefully benefit in some way from the loan. I don’t want to get…
Several years ago, at the height of the thermonuclear phase of the Global Financial Crisis (compared to the slow radiation death we’re experiencing at the moment) a colleague of mine poured scorn on the US as an economy and looked towards the mighty powerhouse of Europe as an example of How To Do Things Right.…
I’ve blogged before that it’s more the cost of electricity and the efficiency of its generation that we should be concerned about rather than the price we ultimately pay. From a national perspective, we pay generation and transmission costs regardless of what the price on our bill is. The profit or loss comes out of…
