More Pain As Interest Rate Hike Starts Tomorrow
Most analysts thought it would stay the same at 3.5% and 7.0% respectively. This has come as a shock to many who are in so much debt it is hard to see them getting out of the hole they have dug.
Today the Reserve Bank of South Africa increased their interest rates by 25 points to 3.75% meaning the base home loan rate is now 7.25% will come a s a shock to many. With everything increasing there is literally no end insight and expect more rate hikes over the coming months.
The problem is salaries are stagnant and only a fortunate few will receive bonuses this December and a salary increase come January. We are talking about the very few companies that have been performing and I don't know of many. I know the family business which is based around online supplying private label to the Amazon equivalent here is booming so there are the exceptions.
A report came out earlier this week regarding the middle class and how they are the biggest offenders when it came to borrowing money. It is as if they haven't had a lockdown and nothing has affected their lifestyles. The average person earning a middle income salary is forking out 60% of take home pay paying their debts. That is insane and now with just the 25 points rate increase all debt payments will now rise leaving them with even less.
I must admit I was a little gob smacked last Christmas when it looked like the entire country was flocking to the coastal resorts without a care in the world. We were invited and refused as I knew that was only the beginning and things will become tougher and tougher the longer this goes on. This is all self inflicted by others not reading the warning signs which are all around them.
I recognise this photo as it is outside the Massmart Distribution Center in Johannesburg where I ran a bicycle assembly plant for a number of years.
Today there was another announcement from another Trade Union with strike action starting tomorrow with Massmart/Walmart on the eve of Black Friday. Talk about picking your timing especially after the riots we saw in June and is just another kick in the teeth. People do not value their jobs and wage increases are not a given. Something called online is going to kill their jobs anyway and give the retail sector another 5 years max before we see less and less bricks and mortar. Warehousing is where the money is as shops are dead compared to what they were 10 years ago.
I think many of us are starting to see how fortunate we are to be involved in crypto as the outside world is a real mess. I know I can smile everyday as my Hive is growing and it somehow has taken on a far more important role than what it used to have. Before it was a long term retirement plan with a passive income, but things can change drastically and is now a great back up plan whatever happens.
Posted Using LeoFinance Beta
