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Saturday, 29 November 2008

‘For the times, they are a-changin’.........maybe

Even when you read these words above, the whiny voice of Bob Dylan pops into your head willing you to sing along even if you don’t want to. Compare this to the current property situation, the questions remain: 

Are the times for property really changing?

Or are things going to get a lot worse before they get better?

For the past 2 years, interest rates have been increased 10 times in order to curb the inflation monster. Current prime rate stands at 15.50% whilst inflation has peaked at 13.6% (a far cry from the projected 3%-6% margin set by the SARB) The Rand has devalued by 40% this year alone & our political situation leading into the 2009 elections, seems wonky at best.

But to every cloud there is a silver lining? Maybe.......

In the past few months, USA, Australia, New Zealand, the European Central Bank, Turkey and even England have cut their interest rates in order to prevent the looming global recession. So why is South Africa the odd one out?

Trevor Manual has said that the impact of the global recession still has to be absorbed into the economy, and therefore a ‘wait and see’ attitude is currently held. But with real estate agents down 50% (maybe not such a bad thing), stock market down, platinum down & business confidence down, maybe it’s time to light the fires & burn the tires !!

(As long as the Rand doesn’t weaken more to negate the expected rate decrease)

The MPC meets on 11/12 December.

Let’s hope they take a feather out of the cap of the Springboks victory against England, by defying the odds & putting the market on course for a recovery leading into 2009.

Please Uncle Tito, how about an early rate cut to get us into the Christmas spirit........

2 comments:

donald said...

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Betty


http://www.my-foreclosures.info

Eric S Doms said...

Donald

I really appreciate the good feedback :) Thanks !!

I'll try to maintain the standard from what it is now.

Keep well
Eric