WARNING: This is Version 1 of my old archive, so Photos will NOT work and many links will NOT work. But you can find articles by searching on the Titles. There is a lot of information in this archive. Use the SEARCH BAR at the top right. Prior to December 2012; I was a pro-Christian type of Conservative. I was unaware of the mass of Jewish lies in history, especially the lies regarding WW2 and Hitler. So in here you will find pro-Jewish and pro-Israel material. I was definitely WRONG about the Boeremag and Janusz Walus. They were for real.
Original Post Date: 2001-12-16 Time: 19:35:59 Posted By: Jan
Dear Jan,
Here are some comments on your concern about the weak Rand. First of all,
I have a very hard time believing the broker’s story
that”anti-speculation” measures are the cause of a weak Rand, at least in
the short run. In the short run, if anything, it may be these
anti-speculation measures have prevented the Rand from falling further
than it already has, as they prevent outside speculators from
successfully attacking the Rand. An analogy can be drawn with southeast
Asian currencies during theircurrency collapses in 1998. If the banks
hadn’t stepped in to “thwart” some of the outside speculators (like
George Soros), it likely would have been worse than it was. Recall a few
years before that when George Soros nearly broke the Bank of England with
his speculation in Sterling. It senta scare through the British financial
establishment that causes them nightmares yet today.
Virtually all major banks trade (speculate) in foreign currencies in an
attempt to make a profit, or to simply build reserves of certain
currencies in case they need to intervene at some point down the road
toprotect their own currencies. However, some banks (just like traders)
are better than others at trading currencies for profit. And smaller
countries, like South Africa (relatively speaking), have a harder time in
the giant global currencies market as they don’t have the financial
muscle to have much of an impact on the global currencies market, which
amounts to over 1 trillion dollars per day globally. Contrary to what
your brokersays, “thin” trading itself may or may not be responsible for
a weak Rand. What will affect the Rand greatly is whether those trades
are successfulor not, just as in any market. Thin trading or heavy
trading in itself is meaningless … as we all know, it’s the quality and
success of the trade (smart buying or selling regardless of the amount)
that determines the outcome.
I was mostly talking of the short run above. In the long run, you are
absolutely right that speculation lies at the core of the Free Market
system. As long as it’s not abused, speculation is healthy, just as (and
being African you will understand this very well) jackals, hyenas and
carnivores keep the overall health of all animals on the African veldt
ata high level by culling the weak and sick.
And when it comes to markets, socialism almost always casts markets among
the weak and sick. The only place where socialism seems to work well is
Switzerland, whose financial system is underpinned by gold and privacy,
making it the world’s banker-of-choice; and whose highly disciplined
social and political infrastructure instills a powerful cohesiveness to
the nation. Everywhere else socialism (communism, centralized economic
planning, Maosim, etc) has failed.
As the once powerful South African market slides towards socialism, and
anarchy, and its social and political infrastructure crumbles, the
currency speculators are only doing what comes naturally. In truth the
falling Rand is just a reflection of the internal health, society,
strength, and prosperity of the South African economy. No amount of
“anti-speculation” measures or jawboning or excuses can ever change that.
Thus, the strength of any nation’s currency is always a measure of its
economic and financial health. That’s why the Rand is weak, in my humble
opinion. A faulty government system is simply manifesting itself.