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Shares hardest hit by price controls
the deal
#21 Posted : Friday, June 25, 2010 2:37:48 AM
Rank: Elder


Joined: 9/25/2009
Posts: 4,534
Location: Windhoek/Nairobbery
VituVingiSana wrote:
the deal wrote:
VituVingiSana wrote:
the deal wrote:
Hehehe price control can bring innovation and massive profits to the likes of Unga i.e they will have a lot of customers in turn raking billion for their shareholders look at safaricom with their bamba 5 and Mpesa...also look at the divergence between the CBK rate and your banks lending rate...damn this banks operate with impunity...LoL.


Erm, how? Your argument makes little or no sense... Please explain...

How do price controls innovate?
Bamba 5 & M-Pesa not coz of price controls...

Like I said... u are making little sense... pls educate me...

@VVS i used Safcom's Mpesa and Bamba 5 as an example of on how innovation can change people lives i.e if we cap Unga at 5 bob its up to the company come up with ways to maximise their profits at that price...ofcourse Unga will have a lot of new customers(demand) because its now affordable...


What are you smoking???

Bamaba 5 is not 5/- per minute... but simply 5/- credit! It's like Unga selling smaller packets of jogoo at a higher price per kilo!

Please look up shortages... It means UNFILLED demand... Unga has no incentive to expand its mills since its VARIABLE costs would be higher than its MARGINAL profits...

Over time, Unga will close up shop if the margins are too low...

Yes, there may be innovation but which country has the highest number of patents? The USA... not entirely free market but a decent example even with all the problems...

Hehehe @vvs u are well versed in this departmnt even though the debate can go on i gues i'm a socialist who feeds on capitalism...LoL.
guru267
#22 Posted : Friday, June 25, 2010 12:36:13 PM
Rank: Elder


Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
GOK is full of shit... it doesnt make any ECONOMIC sense to implement price controls but i guess it makes perfect POLITICAL sense...

they don't know that instead of implementing price controls any SLIGHTLY sane government would aim to reduce cost push inflation and enable companies to improve efficiencies....

GOK will be surprised how much this move will discourage investments since most firms know that in a country like Kenya you can never control or predict your costs but now they want to fix their revenues...
Mark 12:29
Deuteronomy 4:16
winston
#23 Posted : Friday, June 25, 2010 1:29:03 PM
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Joined: 4/14/2010
Posts: 806
Location: Nairobi
The only price control (by mwananchi) that is overdue is on Mpigs salary!
VituVingiSana
#24 Posted : Friday, June 25, 2010 1:37:55 PM
Rank: Chief


Joined: 1/3/2007
Posts: 18,038
Location: Nairobi
winston wrote:
The only price control (by mwananchi) that is overdue is on Mpigs salary!

AMEN & they shud pay taxes on the perks (non-monetary income) like the rest of us!
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Ric dees
#25 Posted : Friday, June 25, 2010 2:47:02 PM
Rank: Member


Joined: 3/6/2008
Posts: 632
Really!! price Controls this day and age, let me reiterate succinctly what we all know..

Price controls can take the form of:

Maximum Prices – Price can’t rise above a certain level. This can reduce prices below the market equilibrium price. The advantage is that it may lead to lower prices for consumers.

The disadvantage is that it will lead to lower supply. There will also be a shortage, demand will exceed supply; this leads to waiting lists and the emergence of black markets as people try to overcome the shortage of the good and pay well above market price.

Minimum Prices:

Minimum prices are used to give producers a higher income. They are used to increase the income of farmers producing goods.

The disadvantage of Minimum Prices

* Higher prices for consumers
* Higher tariffs necessary on imports
* May encourage oversupply and inefficient.

Generally price controls distort the working of the market and lead to over supply or shortage. They can exacerbate problems rather than solve them. Nevertheless there may be occasions when price controls can help for example, with highly volatile agricultural prices. However that said with the history of our leaders, i don't see this going anywhere..albeit i can see what the @deal is saying, we need a new model of economic democracy which ensures that the gova is accountable for long-term stability, not just short term returns but again this brings about the million dollar question " Is it time for a democratic control of the markets" - Aye or Naye??

The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday's logic.
VituVingiSana
#26 Posted : Friday, June 25, 2010 2:53:27 PM
Rank: Chief


Joined: 1/3/2007
Posts: 18,038
Location: Nairobi
The GoK at most should be 'smoothing' out markets e.g. supply/purchase of maize at criticial junctures but at 'market prices'...

Supply of maize from GoK (NCPB) stores will dampen price rises...

Wholesale 'control' will lead to what Ric Dees discusses... Ultimately, a few will benefit at the expense of the many!

I have argued that we need SUBSTITUTES for maize! As Kenyans we need to return to a pre-maize era where cassava, yams, etc were part of the diet!
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
ProverB
#27 Posted : Friday, June 25, 2010 2:59:30 PM
Rank: Veteran


Joined: 3/12/2010
Posts: 1,199
Location: Eastlander
..i keep reading some people saying Mumias is goiing to hurt... how much portion of mumias sugar is exported?..of overal production..what proportion is sugar..compared to elec?
half year results were earnings up 500%..momentum likely carried through 2nd half as year ends this june...meaning probable impact of controls is likely to come in future..not year ending June 30th.. could i be wrong to keep holding..as of now.. As in not offloading before full year results announcement in August/September??
..Let your light so shine before men, that they may see your good works, and glorify your Father which is in heaven...Matt5:16
- 1769 Oxford King James Bible 'Authorized Version
guru267
#28 Posted : Friday, June 25, 2010 3:57:01 PM
Rank: Elder


Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
ProverB wrote:
..i keep reading some people saying Mumias is goiing to hurt... how much portion of mumias sugar is exported?..of overal production..what proportion is sugar..compared to elec?
half year results were earnings up 500%..momentum likely carried through 2nd half as year ends this june...meaning probable impact of controls is likely to come in future..not year ending June 30th.. could i be wrong to keep holding..as of now.. As in not offloading before full year results announcement in August/September??


@ProverB mumias will definitely be hit but only if their costs get out of control and besides they have diversified revenue streams out of sugar production....

this years results look poised to be good (i'm expecting 3billion full year PBT) so i'm also holding mine and accumulating more at these levels
Mark 12:29
Deuteronomy 4:16
mukiha
#29 Posted : Friday, June 25, 2010 4:37:02 PM
Rank: Elder


Joined: 6/27/2008
Posts: 4,114
@Wazua;
We are going round in circles. Please merge all threads about the Price Control Act
Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
mukiha
#30 Posted : Friday, June 25, 2010 4:41:53 PM
Rank: Elder


Joined: 6/27/2008
Posts: 4,114
If I were President, I'd sign the bill to avoid being held hostage by the MPs. Then I'd instruct my Finance Minister to set the maximum prices extremely high, eg., Sh1,000 per kg of Unga &sh5,000 per lit of petrol.

That way, traders will have the freedom to sell at whatever they wish... as long as the market supports the price.
Nothing is real unless it can be named; nothing has value unless it can be sold; money is worthless unless you spend it.
guru267
#31 Posted : Friday, June 25, 2010 4:58:38 PM
Rank: Elder


Joined: 1/21/2010
Posts: 6,675
Location: Nairobi
mukiha wrote:
If I were President, I'd sign the bill to avoid being held hostage by the MPs. Then I'd instruct my Finance Minister to set the maximum prices extremely high, eg., Sh1,000 per kg of Unga &sh5,000 per lit of petrol.

That way, traders will have the freedom to sell at whatever they wish... as long as the market supports the price.


@mukiha i very much disagree with this plan because it costs alot of time and money to pass legislation but it makes no sense to make fuel 5000per litre if there is absolutely no possibility of it getting there

Price control legislation whether maximum or minimum is not done for the sake of it but with the view of protecting consumers and producers from actual risks...
Mark 12:29
Deuteronomy 4:16
VituVingiSana
#32 Posted : Friday, June 25, 2010 7:35:52 PM
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Joined: 1/3/2007
Posts: 18,038
Location: Nairobi
@guru is right... the MPs are playing politics... Populism... expect where their salaries, taxes & perks are involved...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
wukan
#33 Posted : Thursday, October 05, 2017 11:25:36 AM
Rank: Veteran


Joined: 11/13/2015
Posts: 1,567
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...125820-ldl3i3/index.html
maka
#34 Posted : Thursday, October 05, 2017 12:02:30 PM
Rank: Elder


Joined: 4/22/2010
Posts: 11,522
Location: Nairobi
[quote=wukan]
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...25820-ldl3i3/index.html[/quote]

Is this really the best time?
possunt quia posse videntur
kawi254
#35 Posted : Thursday, October 05, 2017 12:27:18 PM
Rank: Member


Joined: 2/20/2015
Posts: 464
Location: Nairobi
maka wrote:
[quote=wukan]
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...25820-ldl3i3/index.html[/quote]

Is this really the best time?




Barring risk of adulterated fuel, people will flock to Somali owned petrol stations which guaranteed will be few shillings cheaper than Total,Kenol Kobil, Shell.
maka
#36 Posted : Thursday, October 05, 2017 12:51:18 PM
Rank: Elder


Joined: 4/22/2010
Posts: 11,522
Location: Nairobi
kawi254 wrote:
maka wrote:
[quote=wukan]
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...25820-ldl3i3/index.html[/quote]

Is this really the best time?




Barring risk of adulterated fuel, people will flock to Somali owned petrol stations which guaranteed will be few shillings cheaper than Total,Kenol Kobil, Shell.


We wont see prices huko 108?
possunt quia posse videntur
mlennyma
#37 Posted : Thursday, October 05, 2017 12:56:55 PM
Rank: Elder


Joined: 7/21/2010
Posts: 6,173
Location: nairobi
[quote=wukan]
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...25820-ldl3i3/index.html[/quote]
the oil stocks will rally hard
"Don't let the fear of losing be greater than the excitement of winning."
Ericsson
#38 Posted : Thursday, October 05, 2017 2:10:45 PM
Rank: Elder


Joined: 12/4/2009
Posts: 10,626
Location: NAIROBI
mlennyma wrote:
[quote=wukan]
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...25820-ldl3i3/index.html[/quote]
the oil stocks will rally hard


The price controls have hurt the small players and the big players have really benefitted.
Kenol Kobil and Total profits have skyrocketed
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
lochaz-index
#39 Posted : Thursday, October 05, 2017 3:06:37 PM
Rank: Veteran


Joined: 9/18/2014
Posts: 1,127
[quote=wukan]
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...25820-ldl3i3/index.html[/quote]
Finally, a step in the right direction. I was worried KE was becoming doggedly anti free market with controls being instituted all over the place.
The main purpose of the stock market is to make fools of as many people as possible.
Sir Jones
#40 Posted : Thursday, October 05, 2017 5:36:14 PM
Rank: Member


Joined: 3/10/2009
Posts: 36
lochaz-index wrote:
[quote=wukan]
Quote:
The cost of petroleum products is expected to jump by large margins as the government removes controls that have seen the Ministry of Energy set retail prices every month. Energy secretary Charles Keter said the price controls regime, which was established seven years ago, had run its course and needs to be retired.
The controls were introduced in December 2010 to protect consumers from high retail prices that were blamed on cartel-like behaviour among marketers. “We have seen efficiency and discipline return to the petroleum market and the government has no business to continue dictating prices,” said Mr Keter.


Applause Applause Applause

http://www.businessdaily...25820-ldl3i3/index.html[/quote]
Finally, a step in the right direction. I was worried KE was becoming doggedly anti free market with controls being instituted all over the place.


I concur with you. This is an indication that the current gova might do away with the rate caps sooner than later. Let us get over this elections and focus on economic activities that have stalled for a while. Applause Applause Applause
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