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R. 2,239,200,044,894. That was our national debt this morning. 90% of our debt is in South African Rand.
Which is great. Because with the ZAR depreciating, it means the 36% that is owed to people who deal in dollars, becomes worth less and less and less in dollars. The downside is - that makes them less willing to invest here. Because. You know. This morning I had $4120 invested in SA, this evening it`s worth only $3996. Also. If credit rating agencies downgrades us to "Junk" status, the following will happen: The 40% foreign buyers of SA`s debt will be BLOCKED from buying more debt and WILL HAVE TO DUMP THE 36% THEY ALREADY OWN. You see, foreign buyers don`t use their own money. They use the public in the US, UK, Switzerland etc.`s pension funds, provident funds and annuity funds. Once a country reaches "Junk" status...they MAY NOT INVEST IN THAT COUNTRY ACCORDING TO THEIR INVESTMENT LAWS.
That means South Africa will have to find someone else very, very fast to re-finance R 880 Billion. Or about $40 Billion at that stage when the ZAR will hit R22 to the $. This is where China and Russia comes in. You see, the US controls the IMF. They will give us the money, but will insist we slash public spending, grants etc. and the amount of people government employs. We can not do that. Riots will happen in the streets.
But China and Russia will give us the money with no strings attached...besides giving them free-entry into our economy and access to our minerals and resources. We are about to become a Chinese province with Russian business-ties.
Which is great. Because with the ZAR depreciating, it means the 36% that is owed to people who deal in dollars, becomes worth less and less and less in dollars. The downside is - that makes them less willing to invest here. Because. You know. This morning I had $4120 invested in SA, this evening it`s worth only $3996. Also. If credit rating agencies downgrades us to "Junk" status, the following will happen: The 40% foreign buyers of SA`s debt will be BLOCKED from buying more debt and WILL HAVE TO DUMP THE 36% THEY ALREADY OWN. You see, foreign buyers don`t use their own money. They use the public in the US, UK, Switzerland etc.`s pension funds, provident funds and annuity funds. Once a country reaches "Junk" status...they MAY NOT INVEST IN THAT COUNTRY ACCORDING TO THEIR INVESTMENT LAWS.
That means South Africa will have to find someone else very, very fast to re-finance R 880 Billion. Or about $40 Billion at that stage when the ZAR will hit R22 to the $. This is where China and Russia comes in. You see, the US controls the IMF. They will give us the money, but will insist we slash public spending, grants etc. and the amount of people government employs. We can not do that. Riots will happen in the streets.
But China and Russia will give us the money with no strings attached...besides giving them free-entry into our economy and access to our minerals and resources. We are about to become a Chinese province with Russian business-ties.
