Manuel: Too many caught in debt trap

2011-11-03 10:57

Johannesburg -  South Africa is a nation of highly indebted families, Minister in the Presidency Trevor Manuel said on Thursday.

"The move from living hand to mouth... is a death trap," he told delegates at the national consumer forum at the Gallagher convention centre in Midrand. "What we will earn next year is already spent."

Manuel said there are 18.84 million credit active people in South Africa, double the number of people in formal employment.

About 8.8 million of the 18.84 million are described as having impaired credit.

"They are in trouble," said Manuel.

"It's a scary number but a number that arises from circumstances." This is because of spending.

"We've spent money we haven't earned yet and we've spent it on goods that we don't need. We (are) trying to keep up with the Kunenes," he said.

This is why South Africa finds itself in a debt trap. Manuel said the protection and rights of consumers need to be exercised.

"We don't provide every single citizen with protection."

However, Manuel asked whether trying to help people not get into debt is taking away their freedom as consumers.

"Maybe we (are) looking for the wrong solution," he said.

South Africa has a low savings rate and so people borrow money at emergency rates.

"There is no cushion," said Manuel. 

  • Dim - 2011-11-03 11:08

    Government is Just as GUILTY!!!!

      kkgosiemang - 2011-11-03 11:42

      Suspect number 1> Government.

  • Makutu - 2011-11-03 11:10

    LOL, too true... Well, keep your expenses low while your income is increasing. That works FINE!

  • Voice - 2011-11-03 11:19

    Live by goverments example.......!!!!

  • Msandi - 2011-11-03 11:22

    "We trying to keep up with the Kunenes" Lol, it's tough to buy/eat Sushi on credit.

      Gierg Seiznem - 2011-11-03 12:45

      I liked that quote too, pretty funny stuff from T-Man...

  • sven.steennielssen - 2011-11-03 11:27

    Money is debt. And debt is always paid. Either by the lender or the borrower. The reason why we find ourselves in this position is because the music stopped in 2008. And the game of musical chairs is now over. Ain't no chairs. Compare this to whats going on in Greece and all over the the Gartman Letter: "European leaders are searching for a relatively quick and easy way out of the government debt bubble that has been building for decades and just started to burst a few years ago. Unfortunately, there is no quick or easy way out. "Debt has to be reckoned with one way or another. It either has to be repaid, or someone has to bear the losses on what cannot be repaid, either through default or inflation and currency debasement. If it were otherwise, everyone could be rich. "The bailouts proposed for the Eurozone do not solve the underlying solvency problem. Instead, they are little more than shell games to shift losses on bad debt from bondholders to taxpayers."

  • Dusty - 2011-11-03 11:28

    maybe if goverment stopped stealing my tax money they could lower tax rate, and in the process allow me to save that extra cash. but noooooo... they take and take and take, and then they are concerned cause i don't save. ID10TS!!!

  • DrGonzoSA - 2011-11-03 11:38

    Imagine what it would be like if we didn't have FICA?

      DennyC - 2011-11-03 12:10

      Slightly better than it is now.

  • baudtin1 - 2011-11-03 11:39

    Maybe if we didnt have to pay almost R6 of every R10 to tax to support lazy helpless people and sponsor our ANC GOVERNMENTS LIFESTYLE.. we wouldnt have to live in debt!!!! STUPID COMMENT!!! TM!!!

      kkgosiemang - 2011-11-03 11:40

      U got it spot on, my thoughts exactly. U r a star

  • kkgosiemang - 2011-11-03 11:46

    U r correct Mr Minister but yet our Government is still waisting money on useless things and does not address corruption (a mother of all blanders, it undermines democarcy). No one has been asked to pay back de money acquired through corruption. Instead you focus too much on ppl who earn their money honestly. Corrupt people dont bank for your info

  • justin.pretorius - 2011-11-03 11:51

    The regime must lead by example and not with rhetoric. There is no incentive in SA to save any money. You get punished by the banks for saving. Only place I will ever invest is Capitec now the rest are thieves. Then there is the regime itself hell-bent on destroying the middle class and making sure there are only two classes: rich and poor

  • Robbex - 2011-11-03 11:52

    If you want individuals to save anything from their income the returns have to be attractive. Interest rates on savings accounts are less than inflation, so what is the point of saving for those with relatively little to put away. I live on income from savings and investments (I am old) and it is far from easy. Whilst it makes sense not to save for something how can you expect to stop people using credit.

      Succubus - 2011-11-03 12:17

      There is a spycological answer to your question. First, understand that it is difficult to survive because you have little money. Then understand that if you borrow money, when you have little money, you will have even 'less' money. So the answer is simple, if its difficult to survive with little money, how much harder will it be to survive with 'less' money. So very simply, do not 'ever' borrow money, 'unless' the money you are borrowing is being used for a business, who's returns are greater than the interest on the debt. But do not ever borrow money for your life. Do not ever use the excuse that its hard to survive with out borrowing, simply because the excuse is meaningless. If you know you will have less than you have now after you've borrowed, then although your situation may be dire, 'obviously' borrowing will not help at all. So you need to gravitate your thoughts to 'another' solution other than borrowing. Borrowing is 'not' the only option, because it is in fact not a viable option at all. Adopt the attitude I've explained above, how ever uncomfortable it may seem, and your life will tend to improve rather than deteriorate.

  • Lanfear - 2011-11-03 11:54

    Yes Trevor, and when goods, petrol, living costs in general go up with triple the percentage you get as a raise on your salary? What is one to do? Keep lowering your living standard until all you can afford is a shack and pap? The middle class is getting poorer by the day, while the poor stay poor and the rich get richer. That is not a healthy environment for saving and living debt-free.

      Succubus - 2011-11-03 12:27

      There is a statement that people often quote. Is goes a little something like this, "The rich get richer, while the poor get poorer". The irony of that statement, is that it couldn't be further from the truth. People who believe that the rich get richer and the poor get poorer, have sealed their own financial doom. In reality, foolish and/or unlucky (but usually foolish) rich people loose 'everything' all the time, all over the world. And then there are smart, wise, poor people who become wealthy all the time, all over the world. The truth is, smart, wise and enlightened people 'become' richer regardless of how poor or rich they were to start with, and foolish, unenlightened people become poorer regardless of how rich or poor they were to start off with. That, is the real truth. I would say less than 1 out of every 10 people I know personally who ever bought a house bothered to check the graph of interest rates in SA over the last 100 years to ensure that they only buy houses that they can afford if the interest rate rise to their 100 to 50 year highs, as they will during the course of this recension. Instead, they borrowed more than they originally planned, at interest rates that leave them on the edge of there monthly budget from the first month. Even though some of these people are my friends, I offer little sympathy for the predicament they find them selves in. There is another saying, it goes like this, "if you dumb, you going to struggle".

      James Peter - 2011-11-03 18:02

      @ Succubus - While I do agree with most of what you say, it is easier to obtain more wealth when you already have a lot to work with. If I have R 100 million to buy an apartment block, that return will be huge, I will get richer. On the flip side, if you have nothing, and every cent you make is used to cover already limited expenses, you will struggle regardless. I'm sure there are exceptions where people have made millions from nothing, but those are exceptions and not the norm, and often those people already had wealth, in terms of their knowledge and abilities to start successful businesses. The blue collar man on the street doesn't have that. What is sad though, is that there are many middle class people with good jobs, wasting what should be their wealth on interest repayments. My strategy to my finances has always been about how much money I pay the bank, and how much goes to me. I've met people earning double my salary but pay 80% of that money to the bank, on interest. So technically they earning a lot less than I do even though they live a better lifestyle. Renting your stuff from the bank is not helping you in the long term, only building wealth will. Those people will retire poor, and lonely.

      linpark - 2011-11-04 00:34

      peter I was one of those rich who became poor but I now actualy have more spare cash. The reason is easy when i was rich and earning over 8k a month my 5 bed house with pool cost 4k my 4.4 vogue range rover and my wife's ml 230 merc 4x4 cost over 1k plus running costs ect ect. I now earn less than half that but my 3 bed no pool house costs 600 I have no payments on my cars ford and fiat ect ect.. it works. also everyone can save just save relitive to what you earn if you earn 50k you can save 5k if you earn 100 you can save 10 or even 5

      Succubus - 2011-11-04 07:18

      One of the greatest dis services any one can do to them selves, is to choose the belief that they need more money now, to have more in the future. If you believe that you need money to make more money, then that will become your reality, simply because you won't even try. You wont even try because you will have already eliminated the possibility that you may have more with out first having something to start with. The frustrating thing for me is most of my financially indebted friends and acquaintances all started with many times more than me, are more educated, and have earned higher salaries than me. The only difference between my self and them is that I don't believe I need anything to start with in order to make more, where as they all believe they need something to start with in order to make more. Our realities diverged over time based on these beliefs. I became very wealthy starting from nothing, according to my belief. Then lost it all, and then made most of it back again, again in accordance with the beliefs that I have chosen. My financially indebted friends, most of whom ironically earn more than me, fell into the debt trap, in accordance with their beliefs. They all tell me that there is no way out and that its the governments fault. And so, that has become their reality. I don't believe the government has any influence over me at all, and that my financial status is 100% my responsibility, and consequently, that is the reality that I experience.

      Thandi - 2011-11-04 08:54

      Well said Succubus - if more people would listen to and take heed of what you have to say, they wouldn't have this debt crisis. As the saying goes - "a fool and his money are soon parted".

      James Peter - 2011-11-04 10:38

      @ Succubus - I'm not disagreeing with you that it's possible to make a lot of money out of very little. What I'm saying, is that your money is most likely obtained through wealth right? In other words, you aquired assets that provide a return, which is used to aquire more assets and make the cycle. The problem is, where does that money come from? Thin air? Really? No, whatever money you obtain from wealth, comes from someone elses pocket, normally the poor and middle class. For example, if you own shares in a company you earn dividends from the profits of that firm. That money should technically have gone to the employees, but it doesn't. Shareholders are more important than employees. So employees are technically working (often for small salaries) for the shareholders to get paid out. Other asset classes? How about property. Your properties are rented to people who often cant afford to buy their own. Why not? Cause they too busy working for the above company, who pays them the bare minumum so that they can pay their shareholders a cut. Also investors (often the above shareholders) buy properties so they can rent them, increase demand for property, and thus the price becomes out of reach for most, forcing them to rent. Do you get it now? For every person (like yourself) that owns wealth, another must pay, it's just nature. So not everyone can be wealthy as you and Robert Kiowsaki so claim. If you earn money for doing zip, someone is working for you.

  • clark - 2011-11-03 11:55

    Tough times

      Vagav - 2011-11-03 12:11

      ..& rough rhymes!

  • clark - 2011-11-03 12:01

    Now Mister Clark you should sign out....

  • Miguel Gomes - 2011-11-03 12:02

    Although I respect Trevor Manuel, he is way off on this one. People aren't spending more on things that they want, they are spending much more on things that they need! Electricity keeps going up, fuel is going up, the toll roads are starting, medical aid costs are going up, we need it because government hospitals are a shambles. We pay so much for private schooling because government schools are a shambles. We pay for our own security because the police cannot keep us safe. Noticing a trend here Mr. Manuel!if I didn't have all these things to pay, trust me I would be able to save money, and before you critisize me for not using government hospitals please have a look at all the ANC top brass. All of them have medical aids and go to the best private hospitals when they are sick. No trust in the government hospitals either hey!

      Succubus - 2011-11-03 13:15

      Trevor Manuel is correct. For some bizarre reason, people in SA are buying more of what they want. The data comes from market surveys which show that south Africans seem to be oblivious to the global recession and are continuing to borrow money for things they won't be able to afford in the future. You would be shocked to know how many people earning less than 10k per month, trade in their 'almost paid off' cars for new ones, often with higher monthly repayments. You would be shocked how many people in SA buy a house, and have no idea what the 30 or 100 year interest rate high was in this country. People who have not analysed the historical prime interest rate chart for SA have no business buying a house. So even though our interest rates are at an all time low, you would be shocked how many people still buy a house who's monthly payment are maxed out to the limit of what they can afford. As the global debt crisis escalates, what are these people going to do when the interest rates begin to approach the historical highs for SA? The data is 'free', so there is no excuse. Most people in SA have not even bothered to pay enough attention to the global economy to know that in 2001 the world fell into what will be the greatest global recession of the last 100 years. Most people in SA are oblivious, due to their own lack of interest, to the fact that we are now 'only half way' into a recension that will over the course of the next 10 years make the 1930's look like a tea party.

      Succubus - 2011-11-03 13:31

      What I meant to say in response to your comment before I got slightly side tracked, is that although the ANC have mismanaged the country quite severally, the economic issues in SA have nothing to do with the ANC or South Africa. The world is suffering a very 'very' severe global debt crisis, who's economic influence is much greater than the influence of any internal economic variables at this time. Trevor Manuel knows this and is doing exactly the right things. Personally I believe he is being to soft on tax, as are most governments around the world. Most countries are still passing through the denial phase of the crash which will come in the next 5 to 10 years, and holding back on tax in order to try and inflate them selves out. The truth is the cycle has fallen past the point of no return. Greek default is inevitable, followed by the total economic collapse of Europe, followed by the collapse of the US economy in 5 to 10 years, which will take the entire world with it. The economic forces at play in the world right now are many times more powerful than anything taking place in our little country. I wish all South Africans, especially the ANCYL supporters would understand this. For SA to survive the coming storm, all citizens of SA must 'immediately' stop borrowing money, for 'anything'. The government needs to 'immediately' shut the ANCYL up, and loosen up foreign trade barriers in order to attract massive foreign investment. And quick! cos time is running out.

  • Mo_Afrika - 2011-11-03 12:08

    Dont forget SARS taking half of their income regardless how much they try...I would love to personally meet the person who thought of TAX jerr, that person must have died ages ago but the legacy still live...

      Steve - 2011-11-04 11:05

      He's dead already..... a chap called William Pitt brought in income tax.... seems it was a temporary measure to fund a war.... :(

  • Harry - 2011-11-03 12:11

    It is funny how people are quick to blame government for their debt situation. As much as I hate the present government like the rest of you, you need to take responsibility for your own finances. The only way to get out of debt is to spend less than you earn. The only thing you should buy on debt is a house. Everything else needs to be cash. Use your credit card like cash. If you living on credit then you living above your means. If this is the case, then ask yourself - Who are you trying to fool?

      Dusty - 2011-11-03 12:25

      this is only partially correct, 2 years ago one could have been living debt free, with the recent petrol, electricity and water hike you can now suddenly find yourself R1000 out of pocket, and if you earn an avarage income of R10 000 p/m this eqautes to 10% of your income gone... how many people can take a 10% pay cut when they earn that amount of money?

      Tolerant - 2011-11-03 13:48

      The only way anyone can live debt free is to save like mad for as long as you can. Most people should have enough savings to survive 1 year without work while you are working> When you retire you should be able to live from the interest on the savings and not the savings itself.

      linpark - 2011-11-04 00:17

      correct house is the only thing.also if you can afford 10k a month get a bond for 7k but pay 10k. just think that car you replace every 3 years costs 100,s of K's but you dont see it as that you only see it as an amount you can afford every month. If you had 300k cash in the bank would you go spend it all on a car??

  • Tolerant - 2011-11-03 12:21

    Save 10% of spendable income every month for 40 years, you will have enough then. Use a debit order on the 1st of the month towards a RA. You can not touch this until you are 55. Just do it.

      gcr - 2011-11-03 14:08

      If you think an RA is your saviour then you are misguided and have been listening to too much salesmen speak. I paid into an RA from age 42 to 64 premiums R80,000 return at end of term R 276,000 hardly a worthwhile return. Rather pay into mutual funds or SATRIX type investments and get a better returm. Oh and also check what fees are levied by your RA trust company - then you will see why they have such poor returns. On the issue of indebtedness - when people stop buying bling items and rolling over motor vehicle every 3/4 years and moving to bigger and bigger houses then only will people wise up - everything is relative so concentrate on quality of live rather than quantity and bling

      Tolerant - 2011-11-03 15:28

      The only reason why I support RA's are that you can not take money out of it before you are aged 55, but any saving is good. I was also in that trap of buying a car every 3 or 4 years on credit, not a good idea. It is a good time to buy a home, but not to sell. Rather save to much money than too little, no one is going to look after us when we are old, unless you pay them.

      debt doctor - 2011-11-03 15:55

      I agree with GCR - RA's generate poor returns and attract significant fees. The tax benefit does not warrant the downside. Instead I would pay off debt where a guaranteed saving ("return") is achieved with no tax consequences. Thereafter SATRIX must be an option with such low fees and zero reliance on so called "experts". Don't underestimate an offshore option though - political risk is so real in our country and look what happens to the rand when Europe, America or BRICS sneeze - somehow the rand devalues?

  • call a spade - 2011-11-03 12:44

    18.4 million in credit trouble , duble the figure in formal employment. 14 Million on Government montly handouts. Should we be surprised. The employed also support the unemployed who just keep on reproducing. Come Trev the ANC messd up on your watch.

  • Chris - 2011-11-03 12:48

    Who can forget that this gentleman started the concept of "Tip for ....."? He never ever used any tips sent to him. He is a smoke and mirrors man and knows how to dance the political three step. The only way we will ever save is when they: a) peg the bond home loan rate at 7.5%pa b) bond repayments not to exceed 15% of the combined spouses income c) peg interest rates at 9% on loans and all other credit purchasers d) general credit and loan repayments to not exceed 15% of income e) peg utilities, water and electricity to 6% increases annually f) de-nationalize utility provision of water and electricity g) reward food growers h) introduce enforced 7% savings from all earners, formal and informal That's enough for a start.

      Dusty - 2011-11-03 13:01

      and in the process take away all financial freedom.... sounds like you lean towards capitalism :)

      Chris - 2011-11-03 15:51

      Ah Dusty, yes I do unless you can prove to me that the other systems have worked anywhere in the world. Reward must be based on effort put in and not on what has come into my pot by my efforts. Remember when you take from one that has worked to get and give it to someone who has not you will end up in the position of the worker also wanting handouts and then they too will down tools.

      Succubus - 2011-11-03 16:50

      @Dusty, I'm curious by your statement. Every single one of the points Chris listed, define mechanisms that 'promote' financial freedom? So how do you come to the conclusion that these measures would 'take away' financial freedom?

  • Gierg Seiznem - 2011-11-03 12:58

    A consequence of poor education on the nature of debt. You have to live within your means. Going into debt implies forgoing future consumption for current consumption, unless it's a potentially profitable investment (which is not what Manuel is talking about). The keyword is "forgoing" - if you save, you're forgoing current consumption for future, borrowing is the opposite. Unless you're going into debt for a car or a house or some durable good, it's not advisable. Either lenders or borrowers are going to find themselves in trouble and government (not just in SA) is likely to side with the borrower. I'm not saying all debt is bad, that is clearly not the case, but uninformed debtors without foresight and an understanding of the need to pay back at some point in the future are not going to escape the trap anytime soon.

  • Vegi - 2011-11-03 13:24

    Who is the fool that deletes my comments? You can continue deleting comments as long as you know that your actions are foolish. Is this forum owned by the banks that steal from our people. The truth is that credit providers are the ones that encourage the debt trap. If you buy cash and save your money you are penalized by being labeled as having no credit points.

  • Rinus Eckard - 2011-11-03 14:13

    No man should be protected from his own stupidity...(or greed for that matter). If you cannot work with money, you shall forever work for money.

      Thandi - 2011-11-04 08:29

      Good comment Rinus - I always apply the principle "if you haven't got it, don't spend it".

  • erick.mamba - 2011-11-03 14:55

    The reality is you can't be materialistic and still be able to save. Its inevitable to stay out of debts, buying a car and a house is mostly financed through a loan. but avoid buying other things on credit, pay-off your credit card and get rid of it if you have one. Yes we paying more on taxes, petrol, food e.t.c however you are steal on the driving seat as far as your finances are concerned, you can't always be blaming Malema and Zuma for your reckless spending behaviour

      debt doctor - 2011-11-03 15:35

      I agree with Erick in that we need take responsibility - it is of no use to continue the blame game. Instead realise that we cannot control those factors but that we can start to measure our spend, determine the "wants" that we can reduce, live within our means and target a debt free life!

      Sheda Hab - 2011-11-03 20:08

      In the real world the drug pusher (banker) is the guilty person and not the user (indebted). Banks give and the people suffer - AND NOTHING IS DONE ABOUT IT........... Manuel, do the RIGHT thing......

  • Lauden Kirk - 2011-11-03 22:34

    Lack of education. You can't buy class you born with it. What is class you ask? Well it's morals and living in your needs not wants. The evil wants to consume you. Ask your self do I need or do I want this every day every second.

  • Lauden Kirk - 2011-11-03 22:44

    14%vat+12%intrestcar+27%tax+bank chargers+bond+fuel++++++++ does it ever stop. ??

      lizelle.plowes - 2011-11-04 08:31

      Agreed, and you did not even add the tax you pay on the fuel. You still need the 4 loaves of bread for the month, and have already cut down on the meat.

  • Helen Ntini - 2011-11-04 04:06

    Prices are too high in South Africa.Government needs too protect consumers from greed banks,retailers and property owners. Help us by selling land at reasonable prices. White people are cashing in and selling land at exorbitant prices. Home loans in turn are expensive. Please put a stop to land sales and do an audit on land ownership. Municipalities and government need to work together to identify land around the cities and sell it to ordinary people and not developers. Stop all these malls that are coming up at every corner. Taxes are too high. How can we save?

      Succubus - 2011-11-04 07:35

      Ironically land prices are relatively low right now. The real estate bubble in SA burst some time ago. The the irony is you can pick up pretty decent pieces of agricultural land right now for bargain prices. I think a lot of people in SA who feel disenfranchised don't understand how agricultural land is bought. You don't need much money to buy land, you need to have a solid business plan detailing how you will utilize the land productively, and then you begin the long tedious process of attracting investment. For larger agricultural projects you will inevitably need to seek foreign investment. If you get it right you can pick up fantastic pieces of land, with out paying a single cent and still arrange a 5% share in profits of what ever agricultural operation you plan to use the land for. And if there was ever a time to go shopping for land, it'd be now, 'while its cheap'. Land in SA is also relatively under priced from an international perspective, so I don't know where people get this idea that land is being sold at exorbitant prices. The irony is that land in SA over all is under priced internationally, 'and' in a local price slump. As the global debt crisis unfolds over the next 10 years, the worlds economies will for all practical purposes collapse, after which, round about 2020 to 2030, the next great economic boom bill begin, and it will make the .com boom look like a corner cafe. And at that time, land in SA will sky rocket. So I'd say get in now, while its 'cheep'.

      Succubus - 2011-11-04 07:49

      Also, taxes are not to high, they are to low! Remember we are in the middle of a global debt crisis and even our own government is starting to over extend its self. Many governments around the world are making the mistake of holding back tax to try and inflate out of the crash. But the cycle has passed the point of no return, total global economic collapse is no inevitable. The first countries to accept this, suck it in, and raise taxes to maintain operational cash flow will be the once who enter the next economic boom in round about 2020. Those countries that hold on to the delusion that they can inflate out by holding back tax will just fall harder. So as citizens we need to accept and encourage higher tax in our country during the next 10 years in order to give our government the cash flow it needs to navigate the global crash thats coming in the next 5 to 10 years. Malls are good for business. They promote centralization of commerce and consumer convenience, and greatly assist in keeping consumer prices low. Unfortunately we have a serious housing shortage in SA and so we rely on developers who make significantly more efficient use of land by building larger numbers of housing units that can be sold at lower prices than could be achieved by individuals, by many orders of magnitude. Home loans are also not to expensive. In fact the prime interest rate is at an all time low. Hove you checked the 30 year prime interest rate chart recently?

  • Carla - 2011-11-04 07:34

    Wwe pay about 70% of our income to tax, thats why we need debt to stay alive. Consumers are just cash cows

  • - 2011-11-04 09:07

    Why do we owe so much money? Let's see...high interest rates on credit cards,low interest rates on savings, gastronomical food prices due to high fuel costs. Not forgetting the high increase in electricity, and this because we are basically giving away electricity to our "neighbours", and we have to pay such exhorbitant prices.

  • debt doctor - 2011-11-04 09:51

    There is no doubt that the lenders and collectors are part responsible for the aggressive marketing of debt, over charging and reckless lending. However the consumer still accepts the offering and needs to take responsibility for this. Part of the trick is to manage the first signs of trouble correctly - which is not to borrow from Peter to pay Paul. Managing your impulse or irresponsible spending habits and to cater for unplanned for events is crucial to your financial health - this is done most effectively by measuring your spend. This allows one to visualise the consequences of an impulse purchase and to set goals providing purpose and discipline.

  • Ignus Kempen - 2011-11-04 10:00

    I am guilty of over extending myself in terms of debt. I think it will only take a major catastrophe like what is going to happen in Greece for people to start realising that we should lower our living standards and to strat living well in our means. Stop buying at a designer stroe becuse your neighbour is buying there. As I said I do not think that this will change unless a major economic crisis is on our hands. Only then will we learn to use money like our parents used to and save a big portion of our funds for future reserves. Until then I cannot see things changing.

  • StJ Prophesy - 2011-11-05 10:01

    The key points to mending SA economy: 1. Lower interest rates by a lot - this will stop carry trade and provide for the rand to be more stable. 2. Go for a weak rand. Why? here's why: 3. Get local production up and exports going. 4. Create jobs, 3 above will provide that. 5. Get the tourism trade going. 6. Stop greed and reduce crime. Sadly none of the above will ever happen and ZA will just be average, if that, never great...

      Nasdaq7 - 2011-11-06 17:57

      Interest rates are at historical record lows and we are still in debt as Trevor Manuel has just said. The advice to weaken the Rand will increase prices of most of the goods we buy in stores. Most of our petrol, food, electric, electronic, computer, telecommunications, cars are imported etc. Weaken the Rand and most of what we buy in shops, retail stores and petrol stations will cost more.

  • Lauden Kirk - 2011-11-06 02:01

    Personal greed is a disease. Quality of life should equal Value for life. Pay high get bad service. In every respect. We can say its cheap and these figures are right. End of the day the common man is suffering. Not the figures on the paper.

  • Ajith Prahalath - 2011-12-15 20:32

    Why isnt he striking at high prices? We pay on average 30% more for our cars BEFORE hp. Buying a house is now impossible. Household appliances and computers are at an all time high (30%+ more than the USA!) Why not solve the distribution pricing (rip-off) problem in our country before telling people not to spend money? I think we are looking for the wrong solutions. The price of importation (since EVERYTHING is imported in our country) is a great place to start!)

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