Why has the Rand collapsed?

Tokai-SA · 2013-08-28T07:03:12+00:00

I was speaking to the Fender distributor in SA, he used the word "mortifying". Explain it to me because I don't understand. The Rand survived reasonably well against foreign currencies for the last 19 years. It survived 9/11 reasonably well. It survived the first few years of the current recession. But now it's collapsed, it's in free fall... Why, what's so different in the last few months from the time period since 1994? No problem, I'm carrying on FULL STEAM AHEAD in the import/distribution business because I'm passionate about it, but I'll have to do it without making any profit. ?

IceCreamMan

MikeM wrote There are many factors, education definitely is one of them.

Check here for a fascinating rundown of some data gathered from 160 or so countries

http://www.visionofhumanity.org/#page/indexes/global-peace-index/2013

education is without doubt important but its a "symptom" of intelligence...without intelligence, education on its own has little worth. We have to nurture and cultivate intelligence , education follows.

unfortunately I cannot access that website will try from my ipad

MikeM

Valid point ICM. What I had in mind was the lack of access to learning materials that is still happening in SA. I personally believe that there should be free access to educational materials if a person wants to make use of them, particularly in a developing country like ours. It'll separate the lazy from those with the desire to make it - but this is just from my small experience of some parts of SA ?

Also, the website is off on a bit of a tangent. It's a interactive map of the world, with a listing of "peace rankings" and a whole bunch of factors they consider for it.

Ray

The wealth is focussed too much. You have too many really wealthy people and too many really poor people. And ideally you should have none of either of them.

But really I dont know how this discussion will make the guitar I've now got to pay shipping for get here cheaper.

strataxe

its an African currency, so it will follow in the footsteps of the powerfull Zim dollar, the ~~Botswana~~ De Beers Pula and other successfull African currencies. ?

21Fretter

Recently covered unemployment at varsity, there are several factors to consider. South Africa has a large unskilled and uneducated workforce but South Africa's economy has continued to develop towards a more skilled economy (e.g. financial services are a massive contribution to the SA economy). This is structural unemployment ("the structure of the economy does not match the skill-sets"), but also, SA has strict labour laws (fairness, BEE etc.) which further pushes companies towards smaller, more skilled workforces. They do not have to train the workforce, do not have to worry about having to fire the people because they cannot do the job, gets costly and lengthy, and look for experienced workers, not giving the recently employable youth opportunities. There is also significant striking, other companies move towards mechanisation.

South Africa needs to obviously improve education to develop skill-sets but unskilled labour (and semi-skilled) is simply a strong contributor at the moment, it needs to be focused on e.g. develop industries which employ significant numbers of this skill-set.

People do say, "When can we stop blaming Apartheid", but it obviously has a significant involvement. The kids who did not have the opportunity for education work in the unskilled sectors earning low income, their children join the world and have to start working asap to help the family live (don't develop their skill-set) etc etc.

Ray

And that's why the Rand is effed?

21Fretter

Ray wrote And that's why the Rand is effed?

Nah, it was a bit of a tangent but it all contributes. Striking does cause uncertainty with foreign investors though who pull out and that does weaken the rand. The global economy not being great as well increases our production costs because we import a lot of capital goods for production, creates inflation locally, foreign investors don't get as much bang for buck as before, and the striking etc....

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