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CBK MPC Meet!!!
Cde Monomotapa
#41 Posted : Friday, December 02, 2011 8:32:31 AM
Rank: Chief


Joined: 1/13/2011
Posts: 5,964
Looking forward to QE County Edition smile
ecstacy
#42 Posted : Friday, December 02, 2011 8:35:59 AM
Rank: Elder


Joined: 2/26/2008
Posts: 4,449
mkonomtupu
#43 Posted : Friday, December 02, 2011 9:00:38 AM
Rank: Veteran


Joined: 2/10/2010
Posts: 1,001
Location: River Road
Well they say business is not charity so yesterday I gave termination letters to employees asking not to come back next year and also told the landlord i wont need the premises next year. If CBK want to raise rates to 30% no need to do business just put the cash into government and hibernate till the good times return. I don't understand how CBK is raising rates yet there is no money in the economy, customers are not paying the invoices, there is no cash flow and the banks want their money.

I don't know what kind of business CBK thinks you can engage in with +30% returns in this market well apart from drugs and speculating on land.
GenghisCapitalLtd
#44 Posted : Friday, December 02, 2011 9:12:09 AM

Rank: Bona-fide


Joined: 11/2/2011
Posts: 191
Location: Nairobi
Mainat wrote:
Up 150bps to 18%.
Not clever, somebody will be paying 30% (30!) on their loan

So GCL ended up being right Applause but the lending rates will just be ridiculous.I just hope this suffering will be for greater good down the road Pray
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“Be a yardstick of quality. Some people aren’t used to an environment where excellence is expected.” Steve Jobs,iGenius
Mainat
#45 Posted : Friday, December 02, 2011 10:13:53 AM
Rank: Veteran


Joined: 11/21/2006
Posts: 1,590
GCL, hisah and the deal, congrats. CBK got it totally wrong earlier in the year and hasn't looked back since... All you need to know is banks lend at CBR+8%

This yr's banana republic economics has benefited only certain groups. The cash rich (read politically well connected) and Kenyans in the diaspora who've been able to exchange their $/€/£ held savings for fx rates the only ever dreamed, put the cash in t-bills and can now potentially withdraw the cash out of Kenya for a very handsome risk-free profit. Finally, the one or two savvy investors, who withdrew from the NSE at circa 4200 and have since been eating risk free cash courtesy of GoK.

A fool and his money will always part ways...
Sehemu ndio nyumba
Impunity
#46 Posted : Friday, December 02, 2011 10:32:12 AM
Rank: Elder


Joined: 3/2/2009
Posts: 26,328
Location: Masada
Sad.
I hope they will not raise the loans taken earlier at sub 16%, otherwise defaults will be kibao.
Portfolio: Sold
You know you've made it when you get a parking space for your yatcht.

2012
#47 Posted : Friday, December 02, 2011 10:34:56 AM
Rank: Elder


Joined: 12/9/2009
Posts: 6,592
Location: Nairobi
bwenyenye wrote:

The bigger issue is can those who were evaluated to pay a loan at 14% three years ago qualify to repay it at 24% today. I don't think so.


I totally agree. And now they're expected to pay at btwn 27-30% after yesterday's stupid decision. You cannot counter inflation with temporary CBR rate increases. How is that going to increase innovation or capital for new businesses and manufacturing? Will fuel and electricity prices come down? Will employers who operate on loans and overdraft increase employees wages? I don't think so.

BBI will solve it
:)
guru267
#48 Posted : Friday, December 02, 2011 11:02:36 AM
Rank: Elder


Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
GenghisCapitalLtd wrote:
the lending rates will just be ridiculous.I just hope this suffering will be for greater good down the road Pray


there can be no greater good in achieving one mandate (stable inflation which is not even being achieved) by destroying another mandate (stable growth rates)

The CBK is being lazy by compromising one mandate for another instead of finding away to achieve all of them
Mark 12:29
Deuteronomy 4:16
Kausha
#49 Posted : Friday, December 02, 2011 11:38:53 AM
Rank: Member


Joined: 2/8/2007
Posts: 808
The problem with this whole scenario is the word HOPE. CBK is hoping the persistent poorly thought rate hikes will reduce inflation. Wananchi are hoping the hikes and suffering are for a greater good. My crystal ball tells me we are sipping on poison that will have grave implications than we are seeing at the moment. Expect the following;
1. Sharp drop in tax revenue. Customs revenue
will remain on the decline as long as the
exchange rate is shit and rates are high.
2. In lieu of 1 expect near panic borrowing by
CBK in January when they discover government
is suddenly running out of cash. By March
next year this will be worse.
3. The next rate drop in January has to be a
drastic drop when CBK finally discover HOPE
is not returning results.
4. Unions are about to come out in the streets,
people are earning money which keeps loosing
purchasing power year on year, the paltry
salary raises can't keep up with inflation. 4. However the Omieri in the room is the many
SALARY LOANS employees, civil servants,
military and police officers have been
borrowing and the revised rates. This will
heighten the Union Clamor.
5. Banks and other institutions will start
laying off staff very soon. By April expect a
bit of momentum.
6. In the end, the campaigns for next year will
have a lot to do with the economy than ever
before.
7. Obax may walk out with a very poor legacy
much to his surprise. The majority don't
care about motorable highways if they can't
eat.
8. Ours is not a very financially literate society, therefore we should walk,guide protect our wananchi whenever they consume financial services. We shouldn't give them a reason to run for their dear lives. By raising rates the way we are doing we are scaring off these wananchi from the private credit space and you can bet they will be overly apprehensive going forward. The way it works with these people is that they rely on our word not financial and economic theorems. We are repeating the same blunder we did with Safcom shares and since then wananchi vacated the NSE. Now KQ and everyone else can't raise much needed capital. We have not had a full subscription since then.....I fear for banks relying on retail business it will be hard to get customers coming in for loans in future.

In essence we are f***ING up our economy with World bank theories that messed us up in the 90's
cnn
#50 Posted : Friday, December 02, 2011 12:59:25 PM
Rank: Veteran


Joined: 6/17/2009
Posts: 1,619
Mainat wrote:
GCL, hisah and the deal, congrats. CBK got it totally wrong earlier in the year and hasn't looked back since... All you need to know is banks lend at CBR+8%

This yr's banana republic economics has benefited only certain groups. The cash rich (read politically well connected) and Kenyans in the diaspora who've been able to exchange their $/€/£ held savings for fx rates the only ever dreamed, put the cash in t-bills and can now potentially withdraw the cash out of Kenya for a very handsome risk-free profit. Finally, the one or two savvy investors, who withdrew from the NSE at circa 4200 and have since been eating risk free cash courtesy of GoK.

A fool and his money will always part ways...

@mainat...we were at 4200 around the month of March,what was the return on the 3 month T-bill then?,and what return to date if you had rolled over the proceeds?
Impunity
#51 Posted : Friday, December 02, 2011 2:04:16 PM
Rank: Elder


Joined: 3/2/2009
Posts: 26,328
Location: Masada
cnn wrote:
Mainat wrote:
GCL, hisah and the deal, congrats. CBK got it totally wrong earlier in the year and hasn't looked back since... All you need to know is banks lend at CBR+8%

This yr's banana republic economics has benefited only certain groups. The cash rich (read politically well connected) and Kenyans in the diaspora who've been able to exchange their $/€/£ held savings for fx rates the only ever dreamed, put the cash in t-bills and can now potentially withdraw the cash out of Kenya for a very handsome risk-free profit. Finally, the one or two savvy investors, who withdrew from the NSE at circa 4200 and have since been eating risk free cash courtesy of GoK.

A fool and his money will always part ways...

@mainat...we were at 4200 around the month of March,what was the return on the 3 month T-bill then?,and what return to date if you had rolled over the proceeds?


Kindu 6.01%.
Portfolio: Sold
You know you've made it when you get a parking space for your yatcht.

GenghisCapitalLtd
#52 Posted : Friday, December 02, 2011 3:09:51 PM

Rank: Bona-fide


Joined: 11/2/2011
Posts: 191
Location: Nairobi
Impunity wrote:
cnn wrote:
Mainat wrote:
GCL, hisah and the deal, congrats. CBK got it totally wrong earlier in the year and hasn't looked back since... All you need to know is banks lend at CBR+8%

This yr's banana republic economics has benefited only certain groups. The cash rich (read politically well connected) and Kenyans in the diaspora who've been able to exchange their $/€/£ held savings for fx rates the only ever dreamed, put the cash in t-bills and can now potentially withdraw the cash out of Kenya for a very handsome risk-free profit. Finally, the one or two savvy investors, who withdrew from the NSE at circa 4200 and have since been eating risk free cash courtesy of GoK.

A fool and his money will always part ways...

@mainat...we were at 4200 around the month of March,what was the return on the 3 month T-bill then?,and what return to date if you had rolled over the proceeds?


Kindu 6.01%.

According to the CBK historical rates the 91 T-bill traded on an average of 2.77% in the month of March 2011.
Follow us on Twitter @genghiscapital
“Be a yardstick of quality. Some people aren’t used to an environment where excellence is expected.” Steve Jobs,iGenius
tutebeng
#53 Posted : Friday, December 02, 2011 4:21:28 PM
Rank: Member


Joined: 10/29/2009
Posts: 40
The CBK is simply doing the wrong thing, with this kind of environment unemployment is going to rise further, poverty increase and growth diminished. No chance of Vision 2030 with this kind of stewardship.
cnn
#54 Posted : Friday, December 02, 2011 5:16:08 PM
Rank: Veteran


Joined: 6/17/2009
Posts: 1,619
[/quote]
According to the CBK historical rates the 91 T-bill traded on an average of 2.77% in the month of March 2011. [/quote]


So 2.77%,10%,14%,16%(approximately)over four quarters to Feb next year ,an average return of 11%.An investor stuck with Kenol @9.60 has had similar return this year already in dividends,one in WTK has had about 6% in dividends and 40% in capital gains.Going forward we will have to wait and see.
@mainat...so being savvy could also be a function of the stock you opted to remain invested in.
smallfama
#55 Posted : Friday, December 02, 2011 6:08:42 PM
Rank: New-farer


Joined: 8/15/2010
Posts: 99
Location: nairobi
we are controlling liquidity driven inflation at the expense of long term solutions. Failing to plan is planning to fail since all our key economic drivers are left to the dogs. We need to enhance agricultural production and value addition, have legislation regulating arable land sub-divisions to non-profitable portions, boosting industrial dvt by lowering the cost of doing business; power et al. We need to have more large scale kenyan farmers and i mean KENYAN not some mzungu selling flowers and horticultural products and then keeping their proceeds abroad after using L Naivasha water. Rains were coming to easy the cost of food but now it is destroying crops and settlements because we cannot tap that water in dams for irrigation when rain goes. We should slap heavy tax on non essential commodities being imported from China. Ati ile mwiko unanunua Nakumatt is also made in China na huko they don't cook ugali nkt. The ministries of Finance and Planning should wake up and give lasting solutions!! I think Kenyans will be sober when voting nxt yr.
the deal
#56 Posted : Saturday, December 03, 2011 12:23:37 PM
Rank: Elder


Joined: 9/25/2009
Posts: 4,534
Location: Windhoek/Nairobbery
Anybody willing to learn and stop listening to panic being spread around read about Measurement of Elasticity or just Elasticity in general.
hisah
#57 Posted : Saturday, December 03, 2011 2:43:46 PM
Rank: Chief


Joined: 8/4/2010
Posts: 8,977
the deal wrote:
Anybody willing to learn and stop listening to panic being spread around read about Measurement of Elasticity or just Elasticity in general.


http://economicsconcepts...lasticity_of_demand.htm

http://economicsconcepts...lasticity_of_supply.htm
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
Scubidu
#58 Posted : Saturday, December 03, 2011 7:00:26 PM
Rank: Veteran


Joined: 9/4/2009
Posts: 700
Location: Nairobi
hisah wrote:
the deal wrote:
Anybody willing to learn and stop listening to panic being spread around read about Measurement of Elasticity or just Elasticity in general.


http://economicsconcepts...lasticity_of_demand.htm

http://economicsconcepts...lasticity_of_supply.htm


Thanks Hisah. @the deal. Would you expound on your statement above please. I'm familiar with the subject matter now.
“We are the middle children of history man, no purpose or place. We have no great war, no great depression. Our great war is a spiritual war, our great depression is our lives!" – Tyler Durden
the deal
#59 Posted : Saturday, December 03, 2011 8:48:50 PM
Rank: Elder


Joined: 9/25/2009
Posts: 4,534
Location: Windhoek/Nairobbery
I will let Kenyans comment on Kenyan issues...apart from my investments here which I can pull out anytime...the rest is non of my business...I will keep my comments strictly stocks!
Hunderwear
#60 Posted : Sunday, December 04, 2011 9:15:06 AM
Rank: Member


Joined: 4/14/2011
Posts: 639
Scubidu wrote:
hisah wrote:
the deal wrote:
Anybody willing to learn and stop listening to panic being spread around read about Measurement of Elasticity or just Elasticity in general.


http://economicsconcepts...lasticity_of_demand.htm

http://economicsconcepts...lasticity_of_supply.htm


Thanks Hisah. @the deal. Would you expound on your statement above please. I'm familiar with the subject matter now.

I second!
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