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simonkabz
#21 Posted : Thursday, December 15, 2011 2:23:12 PM
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Joined: 3/2/2007
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Location: Cameroon
Thanx @GCL.
TULIA.........UFUNZWE!
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VituVingiSana
#22 Posted : Thursday, December 15, 2011 2:44:26 PM
Rank: Chief


Joined: 1/3/2007
Posts: 18,261
Location: Nairobi
The problem Kenya has with a strong KES is that Kenyans LOVE imports. Yes, even toilet paper.

We need a 'weaker' KES (well, not a volatile KES) & I thought 100/- was a good figure to be at. It would have helped cushion exporters, discouraged importers and good for local manufacturing.

The high interest rates in KES benefits those who export to Kenya (who can borrow at much lower rates in Yen, GBP, Yuan & US$) but dissuades local manufacturers who mostly borrow in KES (since they sell in KES).

We had already factored in 'costs' at KES 100/$. The idea would have been to become competitive re: exports & import substitution.

For fuel I would have liked to see an expansion of local bio-diesel production to replace imported diesel.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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kizee1
#23 Posted : Thursday, December 15, 2011 3:58:42 PM
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Joined: 9/29/2010
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Location: nairobi
this move has some major FDI flow behind it, funding isnt even tight yet, KES rallied even at rates crappin out and global risk picture becoming super dodgy, I SAY AGAIN, CBK SHUD STAY THE f*** OUT OF MONETARY POLICY AND LET THE MARKET DETERMINE OPTIMAL QUNATITY/PRICE OF MONEY...this play will be showing again at a theatre near you
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kizee1
#24 Posted : Thursday, December 15, 2011 4:01:13 PM
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Joined: 9/29/2010
Posts: 679
Location: nairobi
GenghisCapitalLtd wrote:
The CBK got an injection of forex funds from the IMF to the tune of US$144Mn Sickquot; (my reaction exactly). Yesterday they used REPOs to mop up Kes.2Bn and today they are in the market again to mop up a further Kes.4Bn, all this to support the shilling which is trading at 87.3 to the US$. We had predicted it will close the year at 87.5 but now things are looking better, how low do you think it can go? I'm thinking 84 by end year, what are your thoughts?




84 trades kesho...84 is looking like a soft resistance...im beginning to think we might close where we opened
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GenghisCapitalLtd
#25 Posted : Friday, December 16, 2011 8:28:45 AM

Rank: Bona-fide


Joined: 11/2/2011
Posts: 191
Location: Nairobi
kizee1 wrote:
GenghisCapitalLtd wrote:
The CBK got an injection of forex funds from the IMF to the tune of US$144Mn Sickquot; (my reaction exactly). Yesterday they used REPOs to mop up Kes.2Bn and today they are in the market again to mop up a further Kes.4Bn, all this to support the shilling which is trading at 87.3 to the US$. We had predicted it will close the year at 87.5 but now things are looking better, how low do you think it can go? I'm thinking 84 by end year, what are your thoughts?




84 trades kesho...84 is looking like a soft resistance...im beginning to think we might close where we opened

i totally agree with you, we might end the year probably at 77.
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GGK
#26 Posted : Friday, December 16, 2011 8:41:32 AM
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Joined: 11/21/2006
Posts: 608
Location: Ruiru
VituVingiSana wrote:


We had already factored in 'costs' at KES 100/$. The idea would have been to become competitive re: exports & import substitution.



Am an advocate of Import substitution. I believe GoK being the biggest single spender should seriously consider this. There was an attempt some times back when the banned importation of office furniture. I don't know whether the ban is still there or it was lifted.

This has more benefit to the economy than perceived lack of competitiveness.
"..I am because we are. "― Ubuntu, Umtu,
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hisah
#27 Posted : Friday, December 16, 2011 9:38:50 AM
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Joined: 8/4/2010
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Wow! KES still grinding gains targeting 80 on 'very strong' eCON fundamentals... As @kizee says - the sequel (release 2) will be played again in the near future. Start booking your tickets in June 2012...

Until a solid fiscal policy is put in place, the vicious cycle is here to stay!

http://www.businessdaily...2/-/11m1nyq/-/index.html
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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VituVingiSana
#28 Posted : Friday, December 16, 2011 10:30:37 AM
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Joined: 1/3/2007
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Location: Nairobi
mututho stuffed his house with imported furniture

http://www.nation.co.ke/...-/113579cz/-/index.html

Here, steel is restricted to curtain rods, window railings, and a security door on the first floor. The rods were imported from Dubai.

Apart from the curtains from Singapore, curtain rods from Dubai, and furniture from Kuala Lumpur and Beijing, most of the other fittings are locally made.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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kizee1
#29 Posted : Friday, December 16, 2011 10:48:38 AM
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Joined: 9/29/2010
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Location: nairobi
so now kes takes out the 500DMA! this thing is on a tear!its(kes) quite overbot at the mom tho wudnt turn long at the moment
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hisah
#30 Posted : Friday, December 16, 2011 12:45:11 PM
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Joined: 8/4/2010
Posts: 8,977
kizee1 wrote:
so now kes takes out the 500DMA! this thing is on a tear!its(kes) quite overbot at the mom tho wudnt turn long at the moment

Wow! @83.25 - What a full cycle reversal! Very 'bullish' this KES... I thought Bernanke and the euro freaks were houdini masters, but clearly CBK is vying for the top honours in 2011. KES has almost reversed the all the 2011 losses against USD in 2mths!? I think SNB and BOJ should study this case with full attention! So by end Dec some forex headlines will read KES, best performing ccy against USD and others. So we end 2011 on high note on KES. Xmas has indeed come early with Dec power bills down, Dec fuel down and inflation expected to peak and head south and lending rates as bullish as ever... KE economy is a bizarre as it gets!

@kizee - you know what happens when you breakdown long term MAs like 200, 300 & 500 on houdini acts? The snapback will be equally spectacular... Definitely I'm booking that ticket in advance. Can't afford to miss that show!

$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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VituVingiSana
#31 Posted : Friday, December 16, 2011 2:08:47 PM
Rank: Chief


Joined: 1/3/2007
Posts: 18,261
Location: Nairobi
@hisah - At a cost. The interest rates are 25% (the recent KBA announcement is almost meaningless. All it does is extend the repayment period by reducing the Principal one pays). And it will only benefit a few. They are allowed to get 20% more than the 'original' payment.

Say you have a 20yr mortgage (just an example & the numbers are approx). Your payment was 100,000/month with Interest 75k + Principal 10k.

Interest rates rise from 15% to 25% so your interest jumps from 75k to 125k. What the bank does is... they say you pay 120k (interest only) with zero principal. The bank takes a 'hit' of 5k/month in interest + no more principal coming in.

The banks benefits from earning 24% in interest. In addition, you do not default so the loan is 'good' on their books. In the meantime, if rates drop, then the 'excess' can be applied to Principal.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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