South Africa Rand Is Crashing

Yeah that is why I don't do currency hedges or options, too much risk.
 
Any outfitter who booked based on 16 or 17 to 1 was kidding themselves. The smart ones booked hunts priced on a lower base rate and should be fine at 13 to 1.

I know for us we just do good pricing period not based all on what the rand does. Some of the places that based there specials on the rate will be putting less in there pocket and that bothers some more then others. It sure will be affecting the specials some guys had going though or what they will be doing here on out.

If you're saying the outfitters should not be adjusting their prices in accordance with what was a wildly swinging Rand last year, then we are in agreement.

However, my less than obvious point was intended for those who thought they should have. Go back to the first page and re-read the posts there. One poster said if the outfitters weren't adjusting their prices accordingly, it was simply out of greed. This was suggested by others also in other thread(s) on basically the same topic. I personally advocated that the outfitters should not be making wild discounts in case the exchange rate went the other way. After all things can as we now have seen change greatly from year to year.

It would seem some outfitters chose to play that game. I wouldn't be surprised if they'll not only be sending clients home with animals but for all intents and purposes with an envelope of cash representing the loss they'll be taking, or at the very least the profit they need to sustain the business.

With the clarity of hindsight, it is easy to say now that those who didn't play the forex game made the smart business decision and won't be hurt by the now strengthening Rand. Had the exchange rate stayed high as it was, they'd still be accused of being greedy despite the decision having been made to avoid putting the business at risk.

And for those that made the mistake of pricing hunts based on a 16-17R / dollar rate, do you think their clients would understand them trying to re-negotiate the contract to a higher price? I think we both know the answer to that question is Hell No.
 
I don't want to over simplify the "buy low/sell high" theory or basic economics.... however, with this industry & the rand. Operations know there are going to be swings, adjustments & corrections. So when you sold a PG hunt when it was $1/$10..... when hunt transpired it was $1/$18..... times are good.... vice versus... not so great. I think for most operators it does not affect.... especially since they trade in greenbacks. I think they are doing just fine. Except for maybe the small operators that are having to buy & stock their game for a particular hunt/hunter. 2 cents.....
 
Some people are greedy no matter what the dollar to rand market is. I think the mistake some people have made is all good deals were based on the rand to dollar. When some outfits just do good deals each year and go after a different market then others. Some have worked with landowners for better pricing and do not have the running cost of others.

Some deals also came about with the game market down. Some outfits built game numbers up when the auction prices were at all time highs. Springbucks is a great example of this. Copper springbuck go up and down sometimes by 1000 or more. If they bought them at the wrong time to start there breeding group up they will take a beating. Hard to buy one for 2500 but only sell it for 1500 and stay in business. Same happened with sable and the deals are still out there and the rand is not the reason why. Others did not over pay but used what was on there land to start. There is a reason a golden wildebeest was over 50,000.00 and now under 8000 to hunt one. Many factors go in to deal sometimes and I just know some hunters made out well this year.

I think there is many ways to run a business and grow a business. The currency game is not one to play with long term that is for sure. Though it can be played if your daring and take your lumps with the good times to.
 
I think most outfitters base their prices on roughly 13 to 1.The Rand just took it's biggest fall % this morning, as a result of Zuma firing the finance minister. R12.94 to R13.60
 
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I find this a very interesting subject. Coming from Sweden, our "federal reserve" has been eager to keep the swedish Crown cheap, to the extend that we now since 2 years have a negative federal interest rate. While this helps the export driven economy (Sweden has 3-4% GDP growth and had it even through the eurocrisis years) it makes for other problem and safaris being expensive is not the worst mind you :)

First, it is simple to obtain a house mortage at 1% interest (and still partly tax-deductably). This had lead to booming house price where apartments in central Stockholm are approachung Manhattan levels. I would now call it a housing bubblet and I am not the only one...

On the other hand, for us who already owns a villa, the lower interest rates sure offsets the low crown/dollar ratio when safariplanning. Good.

I don't see price models for hunting that speculate on exchange rates as the way to go. I would rather hope that one bases the price with some margin and do appropriate adjustments when needed. Of course, if you run a VERY large operation, there might be value of securing a specific rate which can be obtain through exchange futures
 
Things are going to be very interesting coming the next few weeks...we may even get a new president very soon....(y)(y):LOL:
 
We are approaching a global currency collaps ... beginning with € and $.
 
Zuma fires Finance minister, Rand Crashes http://www.theglobeandmail.com/news...ks-finance-chiefs-rand-dives/article34511443/


Down down down in a burning ring of fire



South African President Jacob Zuma sacks finance chiefs, rand dives

In a dramatic late-night move to gain control of South Africa’s treasury, President Jacob Zuma has sacked his two highest finance officials and replaced them with personal loyalists, triggering a plunge in the national currency.

Mr. Zuma dismissed or reassigned 20 ministers and deputy ministers on Thursday night as part of a sweeping purge to get rid of his opponents in a fierce factional war.

In a bizarre touch, his office made the announcement after midnight (local time), at an hour when most South Africans are asleep.

Mr. Zuma gave only a terse explanation, saying that he made the moves to “bring about radical socio-economic transformation” for the benefit of “the poor and the working class.” But analysts noted that he was dismissing the ministers who have sought to protect the government from corruption and cronyism.

Read more: South Africa’s Jacob Zuma holds the key to Africa’s political future

The sacking of his enemies will consolidate his power as he manoeuvres to anoint his ex-wife, former African Union chair Nkosazana Dlamini-Zuma, as his successor at the helm of the ruling party, the African National Congress. But it could also trigger a rebellion within his party, leaving the country in political turmoil.

Among those sacked in the late-night shuffle were the highly respected finance minister, Pravin Gordhan, and his deputy, Mcebisi Jonas.

Their removal immediately triggered a 4 per cent drop in South Africa’s currency, the rand, while economists predicted that the country’s credit rating could soon tumble into junk status. Government bonds have also weakened, adding a reported $200-million (U.S.) to government borrowing costs.

Mr. Gordhan has been widely praised for protecting the national treasury from Mr. Zuma’s bid for free-spending projects such as a huge nuclear-energy project that could cost tens of billions of dollars. He has often clashed with Mr. Zuma’s business cronies, the Gupta brothers, whose vast financial empire includes a web of state contracts and a business partnership with Mr. Zuma’s son.

Mr. Gordhan’s deputy, Mr. Jonas, has enraged the Zuma faction by giving sworn testimony that the Guptas offered him a bribe of 600-million rand (about $59-million) and a cabinet promotion if he promised to co-operate with them.

In the cabinet shuffle, Mr. Gordhan is being replaced by a Zuma loyalist, former home affairs minister Malusi Gigaba, who has a personal friendship with the Guptas. He once attended a lavish Gupta family wedding where the Indian guests were flown into a South African military base, bypassing normal immigration procedures, and he has acknowledged that he has made social visits to the sprawling Gupta mansion in an upscale Johannesburg suburb.

The news of the cabinet shuffle was first reported on a television channel owned by the Gupta family, quoting unnamed “sources.” The channel has been campaigning against Mr. Gordhan for months.

The question now is whether the Gordhan sacking will split the ruling party. Deputy president Cyril Ramaphosa is among those who are reported to be considering a mutiny against Mr. Zuma.

Opposition parties are planning another parliamentary effort to impeach Mr. Zuma. If several dozen MPs defect from the ANC, it could be enough to force his departure.

At the funeral of revered ANC stalwart Ahmed Kathrada on Wednesday, many ANC veterans applauded loudly when former president Kgalema Motlanthe read a letter by Mr. Kathrada in which he called for Mr. Zuma’s resignation. It was an open gesture of rebellion by many of the most senior members of the ruling party – including several cabinet ministers who were sacked on Thursday night.
 
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Like Mugabe, like Zuma.
 
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We are approaching a global currency collaps ... beginning with € and $.

You think the USD is going to collapse? And you think the global collapse is going to start with it??????
 
I have 2 questions about the SA Rand;
1. What the current exchange USD to Rand?
2. Is it better to exchange USD for Rand prior to arrival or to exchange
after arrival?
 
I have 2 questions about the SA Rand;
1. What the current exchange USD to Rand?
2. Is it better to exchange USD for Rand prior to arrival or to exchange
after arrival?

1. Current (tonite) exchange rate 13.42 Rand to 1.00 usd.

2. Do not excchange to Rand unless you absolutely have to. Most outfitters work in USD and like USD. Use credit cards and PayPal. Tip in USD, it will be accepted and appreciated.
 
I always use Rand for miscellaneous, and tipping the staff. Exchange here in the the US and never at the airport. Just got some yesterday at the 13.4223 exchange rate. Just google : Dollar to Rand and you will get the Bloomberg or Forex quote for dollar to ZAR. After the bank discounts the rate to cover their fee, which is usually about an 8per cent discount , it is still much better exchange than at the airport.
 
Thanks for the info.

When I was in South America in '87, it was better to exchange locally than at the military pay master.

When possible at the nearest bank in country it was even better.

I received a post that the Ecuadorians have switched from Sucre to USD.

The villagers outside our base camp at that time made an average yearly income of $1.25USD or 200-225 Sucre.

When making purchases they accepted either sucre or USD. If USD was used they were sure to give the proper change back in sucre.

At the time it was 200 sucre to the US dollar on the local (village) exchange rate. In the nearest "city", (appoximately 3 hrs by chopper/ 6-8 hrs. by road, depending on road conditions dry or after the rain) it was 220-230 to 1.

Example:

Spend $4.00 on souviegners, hand the "shop" or table owner $5.00 your change would be 200 sucre.
On more than one occassion the owner would bargin harder for that fifth dollar than the previous four dollars I just spent and yes, on few occassions I did spend the fifth dollar.
 

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