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Limuru Tea pre-tax profits 72% down
Rank: Chief Joined: 8/4/2010 Posts: 8,977
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stockshunter wrote:At this rate of companies recording poor performance we might see the bear before the end of the year. looking around there are no bargains in the market and more so the poor earnings in agricultural sector which is the leading foreign exchange earner we will have problems. The dollar might sky rocket and the commodities such as fuel and other imports will drive the inflation. If the chingland defaults blow up as expected from Q2, then I expect commodos prices to deflate or even collapse across board! So KES might just survive a nasty squeeze even if the eurobond is postponed or undersubscribed since oil becomes cheap and CBR rates are still high.
But the nightmare would be if chingland defaults blow up and Fed hikes the USD fed rate. That cocktail would properly squeeze many emerging market currencies. Worse for those that rely on commodo exports for their fx reserves. If a nation just relies on say oil exports as the only fx income channel, such an econ will be at the crossfire and their ccy will definitely take it in the chin.
The biggest risk to the global econ is not inflation, but deflation and that's why the CBs have been printing money like madmen since GFC. $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Limuru Tea pre-tax profits 72% down
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