it might first wait for next week's auction. if the rates are lower then it will find its way to the stock market from Monday 16th..

A lot of the bids were at high rates so it does not mean the money is waiting to be invested in lower yielding assets.

@ hisah. Now that the interest rates and coming back down, now at 13%. Does it mean we that the bear is dead. I remember you told me to watch CB action

Bookmarking this for self.

Great insights

The drop in interest rates is because CBK has loosened the Monetary Policy to protect banks after Imperial closed down. The fiscal (deficit) picture isn't pretty. Nor is the substantial negative Balance of Trade.

Once the banking sector has stabilized, CBK will withdraw its QE and we will be back to the usual maneno.

By offering banks cash through Reverse Repos, CBK eases their liquidity crunch.
Why is there a liquidity crunch for some banks?
1) GoK offered high rates so many (smart) customers took their cash to GoK. Bank deposits could reduce or stagnate. Or banks offer higher rates to depositors.
2) After the Imperial Bank fiasco, some small(er) banks lost deposits [& will do so as FDRs come due] but banks make loans so there's a liquidity issue. Apparently, CBK has entered into Reverse Repos with some banks at CBR to cover the withdrawals. These banks will see their balance sheet shrink as deposits shrink. Nevertheless, it beats having banks collapse.
3) GoK's thirst will somewhat be quenched by borrowing another $600mn through a syndicated loan. The problem is the loan is due in 2 years, just after the elections.

Most people who have 'made it' in Kenya believe that they are above politics. That is okey but you should know that the political situation in a country determines the kind of life you live. Socionomists have determined that a large bear market in stocks portends violent behaviour and even major wars. I have stated this before and will state it again. If our stock market fall sufficiently strongly (e.g. below 3000) the you should prepare for disruptions caused by war/violent clashes. None other than the Chief Justice of the Republic has warned of the possibility of a return to violent clashes. Heed him! Politicians are already whipping their people into line this early (when the NSE has fallen from a high of 5500 to about 3800). This violent clash that I foresee will be worse than the 2007-2008 one.

Of course there are people who still don't believe in Elliott Waves (and by extension Socionomics). The best advice I can give is for such people to read the Elliott Wave Principle (it is only about 250 pages) and then keenly follow markets and 'see' if they don't really apply. Arguing with @mnandii will not help you. You managed to be where you are through study. Extend that effort into a new area and see the world differently!

I have been reading the book for about two months, it has been quite fascinating. This socionomics thing is growing on me. @mnandii kwani there is a 250 page version? Which one is that? My copy of "The wave principle of human social behavior and the new science of socionomics" is 463 pages and I am less than half way through. I read a few pages a get a new concept and I'm off validating it only to remember...oh the book, I need to go back and read some more! So it has been back and forth read, validate, read validate...sijui when I will finish the book.