Zambia sees 2007 inflation down to 5.0 % – BOZ

1. From 32% inflationary status to 5.0%.This is what is called phenomenal econometrics. Bravo for the tenacious fiscal discipline and painful sacrifice!We can do more.

2. Dr. HK I give you a new name from from today onwards you are DrFeelgood.I think this one suits you very much because of your kindness and read to help us in your field of Autospy. I believe you rush and meet LPM to congratulate him in his hard working. When the thieves will pay our economy will even pick more. One digit inflation Sage is what Zambia need. Countries like Germany has 2.0% inflaction and these is accepted and even 7% is okay. Now what we need is Full employment because this is cardinal for our survivor. Mr. Fundanga next time pilz realise also the unemployment rates because these how economy growth is measured.

3. Dont be fooled by these numbers. these numbers are cooked by IMF. As Zambians we don’t even own 30% of OUR own country(MINES). its a shame!!!!! Zambians are naive. Its unbelievable.When are we going to wake up??

4. #1 PRAGMATIST.Whithout being abussive may you please justify the single digit inflation verses the high unempolyment and poverty levels in our nation?

5. #1 PRAGMATIST.Without being abussive may you please justify the single digit inflation verses the high unempolyment and poverty levels in our nation?

6. #3 Zambian. Its you how doesnt know your own country. Some of us we have seen Zambia from the source of the Zambezi river in the Kaleni Hills to the Muchinga escapement in Eastern province. Travel all the way from Lake Tanganyika to Itezi tezi Dam. I know you have never be to Mufulira or Chingola. If you want move from Kasumbeleza to Kanzungula my brother. At Nakonde you go to Chadiza and connect to Mulobezi for Timber. If that is not enough go L-Town and jump in the Victoria Falls the Kariba Dam will happy to generate you for power. Have you been to Kasaba Bay or Lake Mweru wantipa or Bangweulu. I sometimes like in Kafue National Park then I cross to Kalabo and Mangango. If you want to grow cotton go to kapiri and Mpika or Chamuka area in Kabwe. Please may you advised to visit Solwezi and Mwinilunga. I hope you have enough time and energy because Big Malaria is claiming everyone.

7. kwacha is not gaining value at all its the US dolla dropping down worldwide.The US economy is sicking.

8. Chapi I need the answer to I have asked the same question? Zambia has a working force of about 500 000 civil servants and how many work in the private sector. I know the labour ministry has no data about this.

9. Easy my friend.. Employment is being created in Zambia and will soon reach saturation level. I can see hope for my country as long as we keep away the thieves and punish the crooks dead or alive

10. BaJoze, How is Kafupi doing in Joberg?

11. #7 Bman, can you define Depreciation of a currency also please enlight the Bloggers on Appreciation. You should be mindful and dont be naive learn some simply economics like why do go and buy food or why are you travelling. How is possible that yo can go to a disco. Critic have you forgotten that the president rejected this increase of taxes early this year. Anyway Zambians forget quickly now its true. Remember are not children.

12. Dr. HK good you are now in line and good thinking I also dont condone Bakabulala, nachitola fe. Dont be scared my friend say your opinions and even write to the president and critise him where things are not okay and praise when its worthwhile.

13. Caleb Fundanga is doing a fair job keeping his total academic faith in inflation targeting. The fellas at MOFNP need to provide him a coherent overall economic policy framework so his strategy does not injure other important national economic goals.
    We’ve been on this long, painful stabilization road for a while now. So sticking our head into this single-digit inflation while interest rates are so high could be hurting us. Unless we manage to somehow disobey economic laws, further contraction of demand to achieve 5% inflation will reduce our export competitiveness, employment and increase poverty.

14. #11 Easy. Currency depreciation is a decline in the value of one currency relative to another currency. Depreciation occurs when, because of a change in exchange rates, a unit of one currency buys fewer units of another currency.

15. #13 Francis can you explain what you mean I didnt understand you last sentence. Its seems you are over looking the law of supply and demand.
    A viable concept in understanding supply and demand theory is elasticity. In this context, it refers to how supply and demand change in response to various stimuli. One way of defining elasticity is the percentage change in one variable divided by the percentage change in another variable (known as arc elasticity because it calculates the elasticity over a range of values, in contrast with point elasticity that uses differential calculus to determine the elasticity at a specific point). Thus it is a measure of relative changes. Now supply is there and demand for copper and other minerals is there.

16. 14# Bman why are you saying Kwacha has not appreciated hence you you define the changes in the same context.The Kwacha has gained value. All what we need is fight and defeat the novices that affect our economy like high price of fuels and petroleum, food and services. This makes them affordable. So which way are heading?

17. Adam Smith observed that people pursuing their own interests could, if guided by a competitive market, serve the public interest. Smith was right–the interaction of individuals in competitive markets results in economic efficiency. This means if people are let to work and earn there own money they are able to pay for their needs.

18. Its very intresting reading how Zambians have book knowledge of Economics and yet our country’s economy is going in circles, let alone our ‘good’ BOZ governor is being paraded by IMF as spokesman, putting ‘butter’ on our faces. Mr Fundanga, LPM said it already, “we are not children” #13,(francis) LPM and his Govt have no ‘Economic policy framework’ only if we can break from economic slavery from IMF just like Hugo Chavez of Venenzuela has threatened.

19. Easy, as long as our hope is in Indeni in its present state, Zambia shall never see stability in the Oil Market. Time to start thinking without Indeni is now so that our Children wont have to deal with the same problems.

20. #15, here are the contradictions i see.
    Given that we’re in times of low production, high unemployment and poverty, inflation targeting to 5% does hurt our economy because it results in an increase in interest rates. And an increase in interest rates does 2 things. (a) It dampens domestic capital accumulation and (b) also dampens foreign direct investment (contrary to what Fundanga and others say, investors dont like high interest rates). So this kills domestic job creation and also keeps us at a disadvantage with our trading partners. Hence hurting our export competitiveness, which is the key source of our future growth and poverty reduction. But MOFNP has a motto of export-led, poverty reducing growth which is why i made reference to them.
    Further, tightening monetary control will usually make the kwacha less attractive to foreigners and this also hurts our growth.

21. Interest rates are prices
    The beginning point in any analysis of interest rates is the recognition that they are prices – and as prices the best way to understand them is with the supply and demand models. Important steps in this approach are:
    4.describe the situation graphically
    3.explain the behavior of the players
    2.identify the players (buyers and sellers)
    1.identify the market
    We can as well you the cookbook apporach: The market is Money market(BOZ who are the suppliers I call this Fundangalistic theory approach and demanders of money are individuals and companies and this determines the interest rates which is the price. What is the Market? Money, What is the Interest rates? Prices, who are the team members? Suppliers= Boz, Banks, Other lending Institutions like Kaloba, Demand= Households, Firms, Kachaso drinkers,Thieves. What affect these two sectors? Supply=BOZ polices, Interest rates, Risks. Demand= Income, Wages, Peace Worker earnings, Interest Rates.

22. 18# Zambian, What is should be done. Is to pay off the debts and and become a lending nation. We can do this good willing. Dr.HK yes we have to work for our children they need Zed.

23. Didnt get your full point Easy. But…
    So when the GRZ tightens its (or your) belt, there’s less money available to you, to GRZ and to commercial banks, so the price of money(interest rate) goes up. Then the businesses suffer and jobs are lost or not created. Farmers go bankrupt and potential direct investors (not TB dealers) also stay away. The wheels of our national productive sector slow down or stop running altogether. Poverty ensues, but Fundanga has his 5% inflation-which should prepare us for a restart, not now but in future.

24. Easy, by govt withdrawing from borrowing from Banks alone will push the Banks to other players like individuals and SME’s. As these pipo avoid banks due to high interest rates, the Demand will be reduced further and will force the banks to reduce their interest rates to atract new player. With time and reduced risks by customer payment prudence(Culture) ..We shall see new initiatives in the lending institutions which will offer flexible and negotiable interest rates much lower that the standrd rates.
    First the govt has to start to deliberately move away from these markets.
    I have already seen our banks reacting to some changes by offering some finacial tools to individuals.

25. HK#25,you’re definitely correct. But if Fundanga pursues a tighter grip on inflation to 5%, the rates wont come down. You can fairly predict that. Thats my main worry and i hope am wrong. We are only a $4 billion economy lets not forget.

26. Dr.HK good idea but you are not mentioning where GRZ will get its money? Any suggestions. We need these ideas to feed Fundanga.Zambia has a chance of developing the next for 5 years because of the sport activties coming up.

27. Iwe HK, how is bamudala ba VJ pa Morningside Clinic? Tatulaumfwako since he left Zed. Ba Joze, ati hani umunenu VJ pa RSA? Zed is doing fine than it was some months ago. Ba Joze muleke utuntemba, go and join the mines ku Solwezi. Magande won the case, but I don’t know how fair the hearing was since our juducial system has been invaded by chuchu.

28. Francis which point did you get? I hope Fundanga is not following money as Fiat Money because it will have the impacts you have mentioned above.

29. #28 We shall not give an info about VJ because you were making funny of him. This is a family issue no news to outsiders.

30. #26 Francis, I agree with you to an extent. I think we need an inflation level which makes our economy function at optimal level. Inflation drop with corresponding exchange rate appreciation would record negative returns in our export oriented market as cost of production will become unattainable in short term as companies may fail to meet some Labour numerated in Kwacha.The option would be to replace humans with machinery.. The long term effect though would be positive as a low inflation rate will stablize the exchange rate making budgeting and planning easy. Francis, one other thing Zambia can be happy about is the increased value of their property which they can use to borrow.. assuming we shall have reduced interest rates.
    I would rather see a growing economy, with reducing poverty indexes,and inflation at single digit.

31. #27 EASY makes a lot of sense. he is a true Zambian who thinks for ordinary Zambians, that is, their livelihood and future especially when he says, “to pay off debt and becoming a lending nation” and he further says, “where GRZ will get his money” Easy you’re brilliant. But you know what, those are our two weaknesses that our ‘economic slave masters'(IMF) capitalises on. They sholve loans under our throats so we can be perpertual beggars, and secondly, run our govt broke with the trade agreements they attach to these loans. wht a circus!!!

32. #31 I hope I didnt give you an impression that am against lower inflation. Inflation if possible should be zero or negative. All I was saying that when you begin to trade in 10-12% after 16 years of, BOZ need to dampen their own expectations of lower inflation. So, they could tolerate 7-9% for next year in order to ease the pressure on interest rates. Then, it will be less painful in jobs and poverty, if we moved further down to 5-6% in say 3-5 years. I think at that point interest rates would need to come down to where inflation is right now. That was my point.

33. Zedian you can analys issues very clearly and understandable but implementing and establishing of what you talk about is another case you don’t want to do.Lets put into practise of what we say and move Zed forward rather talking about problems and solutions of which will never happen on its own.Development of a nation takes a sacrifice of one generation for the better of the one to come.

34. #34 Bman you are right Iam not at BOZ I can only give advice it taken be taken or not. So its up to Mangande and Fundanga to put these vision in practice. Zambian implementation is not a problem you know they say where there is a will there is a way. 60 yrs ago Germany had hyper Inflation. They were get 90 Kgs bags to buy a banana, but they overcomed this with a period of 10 years Germany became a developed nation. So we can do it,the world is very competitive and we should be not be the early worms caught by the birds but the early birds to catch the worms.

35. Interest Rate Money Supply

    Increas Demand UP UP

    Decrease Demand DOWN DOWN

    Increase Supply DOWN UP

    Decrease Supply UP DOWN

36. Easy the BOZ guyz do they read what we write or its just the share waste of time.

37. EASY and Chapi you remember last week i had a heated debate with Kuku over the GDP and the inflation rate. I questioned the validity of the inflation rate. When you have more than 80% un employment and your exchange rate is about K4,500 to a dollar not forgetting that more than 60% of Zambians dont participate in the commerce of the nation. Its hard to believe these cooked economic indicators. As i pointed out last week most Zambians worry about the dollar to Kwacha rate than the inflation rate. Which is evidenced by the long lines at Western union. I would suggest they keep the figures in the closest because they dont mean a thing to a Zambian on the street. If magande and Fundanga want something to show to the donors thats fine.

38. Bman (37),
    Your theories here are all a Share waste of time. No leader worth his salt would engage in trolling business or worse still dig in blogs taking his scarce time off pressing issues.You think there is anything theorized here that those technocrats and learned politicians don’t know? Even those who provoke the debate and step aside silently following both smart and faulty theories here are certainly very knowledgeable than some of us trolling here.

39. Certainly your theories here are nothing but a Share waste of time. No leader worth his salt would engage in trolling business or worse still dig in blogs taking his scarce time off pressing issues.You think there is anything theorized here that those technocrats and learned politicians don’t know? Even those who provoke the debate and step aside silently following both smart and faulty theories here are certainly very knowledgeable than some of us trolling here.

40. Morning, abena Easy, Kuku, Kanyata,Am, Bman, Saga and Zambian what all of you have written makes a lot of sense and i hope that the Bankgovener Dr.Fundanga. My question to you the big brains is on the name of our currency. Known as Kwacha since 1968. How did the name kwacha come about? Was there a referandum to choose the name Kwacha? From my little understanding Kwacha is a bemba word, meaning “Dawn”.In my opinion we need a referandum to rename our currancy, so that there is a balance in the name of the currancy. waiting to hear from you big brains.

41. Our government needs to take a thorough investigation on how most companies where sold. They need to bring some culprits to book. People like Valentine Chitalu. Why some companies like Zambia Breweries’ house documents and titles deeds first disappeared before the company was let go. We need to find out why chiluba’s government ignored the management buy-out plan and sent everybody home pensionless. People were cheated of pensions and long term savings and our current government has ignored such injustices that need to be corrected. The rule of law must be seen at work that is when those inflation rates will make sense.

    Let’s bring all the thieves to book. Let’s repossess every government council, National Housing etc house that was bought illegally in short let’s allow the law to control the order of the day or else those statistics will only remain at bank of Zambia’s data bank.

42. Easy,
    Not trying to be sarcastic or hilarious as I always do, by any chance are you a Congolese Kasai or Nuachusa from Tunduma TZ? I have noticed your struggle with the queen’s language to be way too much. Undoubtedly you do have ideas of issues but evidence of some literal translation from some alien language into the broken English is overwhelming on. Ever since I started patronizing LT, I have been struggling to piece your messages together. I know due to speed we all post messages with uncountable typos buy ewe ulepatula sana Man. Try writing in word first, edit and then past here to lessen the kafwafwa in your lingo issues. Don’t be discouraged, just keep coming and try some learning programs. I see you being one of Zambia’s prolific writers some day. In our intake with the Current Commerce Minister Felix Mutati at the Ndola campus, Fred M’membe was a disaster in English writing skills despite being Editor of some Marxist propaganda paper that circulated at Campus then. But he never got discouraged in spite of his communication short-comings. Today just look at his editorial writings in the Post Newspapers. His motives and messages aside, the guy is a prolific writer to the dismay of many of us who know him closely from time in memorial. You could ask our the professor Mubanga Kashoki.

43. nalumba (41),
    The name Kwacha for the zambian currency was not really crafted from the Bemba languange incase you have trouble with that.It was infact derived from some Chewa-Nyanja language then predominately used in the military and BOMA structures. Infact it whole message is ” kwacha Ngwee” Meaning after independence light dawned and we can see our way clearly. So no need for a referendum over than ba bwana besu. Just clear your mentals clouds you have with the Bemba language.We are all one people under God in Zambian.

44. nalumba (41),
    The name Kwacha for the zambian currency was not really crafted from the Bemba languange incase you have trouble with that.It was derived from some Chewa-Nyanja language then predominately used in the military and BOMA structures. Infact its whole message was ” kwacha Ngwee” Meaning after independence light had dawned and people could see our way clearly. So no need for a referendum over that ba bwana besu. Just clear your mental clouds you have with the Bemba language.We are all one people under God in Zambian.Bemba, Tonga, luchazi, Ng’umbo or Nyanja they remain Zambian languages necessary to pick some message from.

45. #43 Sophist, Dank if they are not errors I hope you have heard about Zangalish or Bemlish. These are new languages which the Internet brought us. Just take the time to understand the content. I hurt the queens language because its the only weapon of slavery remaining. Our children if they cant articulate themselves in English then they are said to failures or dull.I dont intend to be editor like Fred, because these F names at the end of the day u become a crook. Hi Sophist if I was to send to you an SMS then you can hardly understand me. Change with time learn chinese Mandalini it will help you thank God I dont write how I speak.

46. The kwacha is the currency of Zambia. The ISO norm 4217 code is ZMK and the kwacha is subdivided into 100 ngwee. The name derives from the Nyanja and Bemba word for “dawn”, alluding to the Zambian nationalist slogan of a “new dawn of freedom”. The name ngwee translates as “bright” in the Nyanja language. My father told me that this was to cement the chacha campaign which brought the Zambian freedom. It was very easy slogan that Kaunda used to convince the Tongas for the same words in Chitonga are used. This led to the completely defeat of Nkumbula during the run up to the Choma Declaration. The Bembas are use the same words. In 1968, the kwacha replaced the pound at a rate of 2 kwacha = 1 pound (10 shillings = 1 kwacha). The currency has suffered from high inflation. In 1968, the kwacha was worth 1.2 U.S. dollars, but in 2006, the dollar was worth about 4000 kwacha.In 1968, bronze 1 and 2 ngwee and cupro-nickel 5, 10 and 20 ngwee were introduced, followed by 50 ngwee in 1969…..

47. In 1982, copper-clad-steel replaced bronze. The 1 and 2 ngwee were struck until 1983, with production of the 5 and 10 ngwee ceasing in 1987 and that of the 20 ngwee in 1988. Nickel-brass 1 kwacha were introduced in 1989. In 1992, a new coinage was introduced consisting of nickel-plated-steel 25 and 50 ngwee and brass 1, 5 and 10 kwacha. In 1968, the bank of Zambia introduced notes for 50 ngwee, 1, 2, 10 and 20 kwacha. 5 kwacha notes were introduced in 1973, the same year that the last 50 ngwee notes were issued. 50 kwacha notes were introduced in 1986, with the 1 kwacha note being replaced by a coin in 1988. 100 and 500 kwacha notes were introduced in 1991, followed by 1000, 5000 and 10,000 kwacha in 1992, when the 5 and 10 kwacha notes were replaced by coins and the 2 kwacha discontinued. In 2003, 20,000 and 50,000 kwacha notes were introduced.

48. These look like cooked numbers. Are we not suppose to see a correlation between interest rates and inflation. What is the lending rates now. As far as I can remember it was about over 40%. And looking at inflation, how are they going to manage the 5% because inflation worldwide is on the upswing due to energy costs and Zambia is no exception and I don’t think the Kwacha has strengthened that much. It was 3100 to a $ two Decembers ago and as someone said, the $ is just weakened.

    Maybe BOZ defines inflation as govt spending or borrowing. I think Energy is a key component in Zed even villagers know that increase in fuel messes up everybody and I don’t see oil price going down anytime soon. There is just no spare capacity anywhere in the world today to meet the current demand.

    Looking at BOZ site I can’t even see what makes up the CPI calculation. No transparency at all, that is why I can’t invest in Zambia FOR NOW. LONG term risk too high. I will just trade right now.

49. #49 The world has to two problems China and climate chnage. China is consuming everything and climate is destroying everything like is the case in UK now. These will push the prices of oil per Barlell in the Market.

50. #38 SAGE yes I remember but sure where on earth can you have full employment? Are you going to count patients in hospitals and under age of workers. Zambias population has about 60% of children. Be careful SAGE these theories. Iwe AM if you have nothing to contribute just go to Mongu and buy Ilitapi. We know that pipo are busy even us we are busy too but we take time to attend to matters which affect us daily. We also here to educate each other. SAGE, Francis, CHAPI, Kuku anyone with the lastest Balance of Payments review for Zambia. I only have fron 2002. How doesnt the current Account for Zambia look like at present. I worried because of FTJ case it might be more negative next year.

51. Iwe ci Hakaichile Kalikeka (HK – #39&40)leka ukubofye IP yandi we CHIBANDAwe. U have started ur monkey tricks early in the morning. By the way have u washed today to remove yesterday’s body odour (akachena)or did u buy cheap body mist in my katemba at Kulima tower, it should have costed u only 50 ngwee, for u I can come down to 20 ngwee.

52. Sophist tell your prof. to make correction in that book Loanword Citonga doesnt exist but Chitonga. I know he sometimes lectures at the university of Michigan in USA.

53. Dr Chiluba and late Ronald Damson Siame Penza are the architects of this low inflation. They made sure that Zambia attained HIPC, which qualified the country for a major Debt cancellation. I know tribalists believe Mr Magande is responsible for these low inflation, they must be out of their heads.

54. #54 Truly Zambian, elyo wacibuka ikufuma kumanda. Stop day dream your Kafupi and Ronald are what we call failures in life. Failing there own pipo. bakabola tiyako Atase.The economy is starting to pick because Zambians can now consume and sell my dear. These has to do with good policies that has been implemented by the administration. Its not only Magande but the democracy we are enjoying is the driving factors. Above all the peaceful Zambian who loves its country.

55. Hyperinflation – what’s that?
    This is what happens when the value of money plummets.

56. Mbozi (54),
    I have rightly figured out who Pragmatist is going by his opinions. For fear of breach of privacy rights and possible legal suits I will only confess, he is a man I have engage with on some contentious topics in other discussion forums for a good span of years. I know of a specific forum where he has a deep hand in ownership and participation. Frankly, he’s a seasoned activist with an amiable persona on issues of agreements but certainly with a focused mindset you may need more effort and facts to curve him. Predominantly his personality is of a loyal combatant for his values. My advice is, instead of you turning into a complaining sissy; consider increasing the layer of your blogging skin if you have to withstand these political machineries too shrewd with some phenomenal propaganda skills to demoralize opponents. That is how they turn power and National leadership into their own dynasty of friends and accomplices in perpetuity. Look at how the MMD machinery is knocking out those they don’t like to join the leadership band wagon. Nevers Mumba is one such who they have systematically turned down his ambitions to line up as their party candidate after Levy. They would allow you to join the party but attach a 3 year period conditional clause to vie for any position in and on the party platform. Those they like, they enlist them silently to beat the 3 year condition. VP Rupia Banda’s membership application I hear was activated in retroactive while Nevers Mumba may be admitted short of the 3 years period maybe in 2009 to make him ineligible. The post should dig deeper on Sikota. He could be having his membership already. We may be just spammed up with another candidate in a short but confusing time.

57. Sorry meant to post this in respond to mbozi (92) under subject heading “COURT CLEARS MAGANDE OF GRAFT CHARGES”

58. And Parliament heard that the value of Foreign Direct Investment (FDI) was K259 billion in 2001, K1,305 billion in 2002, K1,645 billion in 2003, K1,739 billion in 2004, K1,696 billion in 2005 and K1,260 billion in 2006.
    Minister of Finance and National Planning Ng’andu Magande said this in response to Bahati MP, Besa Chimbaka (PF) who asked what the value of FDI inflows into Zambia was from 2001 to 2006.
    And Government disclosed that K6,994,582,274 was raised from 4,634 Government vehicles that were auctioned from 2002 to date.
    And Mr Magande said the Bank of Zambia (BoZ) would only reduce the Kwacha from a four-digit level of thousands to two digits of tens and re-introduce Ngwee units, after inflation was maintained at low levels.

59. GERMANY 4.3% INFLATION
    UK 2.7% ”
    FRANCE 1.5% ”
    USA 2.69% ”
    ZAMBIA 8.2% ”
    Magande and Fundanga should stop cooking up figures.

60. GERMANY 4.3% INFLATION
    UK 2.7% INFLATION
    FRANCE 1.5% INFLATION
    USA 2.69% INFLATION
    ZAMBIA 8.2% INFLATION
    Magande and Fundanga should stop cooking up figures.

61. # 54 Truly Zambian
    People like you are very shallow minded and are driven by euphoria without facts.Chiluba and Penza generated so much upheaval in the economy , they by creating an enabling environment for them to plunder. Penza under Chiluba’s tutelage ended up razing all the foundations of the economy without consideration of the long term effects. A case in point is the closure of Zambia Airways. I remember Penza while being interviewed by Frank Mutubila saying that Government was not going to bail out Zambia Airways because only rich people flew hence it was not going to affect the poor people. He did not understand the economic significance of an airline to a landlocked country and to an economy that was relying on tourism to replace copper as a foreign exchange earner.
    As finance Minister he stands far behind Ngandu Magande the technocrats in the ministry of finance attest to the fact that Mr Magande knows his job and alwas relys on professional advice from his experts.

62. PENZA on the other hand was full of himself, arrogant a know all type.He intimidated and brow beat experts in the ministry, and did all sorts of things to enrich himself. He was full of greed and sloth. No wonder he ended up being murdered by his fellow plunderes. Who has forgotten the dryport issue,meridian bank,promissory notes among others

63. #38 Fundanga said inflationary pressures would ease on the back of a build-up in strategic food reserves, EXCHANGE RATE STABILITY due to increased foreign exchange earnings mainly from copper, as well as lower money supply growth in the first half of the year.He is not saying the exchange rate is the best measure of the economy.For your own sake I have repeated the meanings again may be this time you will find time to read them.
    What is Inflation?
    At its most basic level, inflation is simply a rise in prices. Over time, as the cost of goods and services increase, the value of a ZMK is going to go down because you won’t be able to purchase as much with that ZMK as you could have last month or last year. Of course, it seems like the cost of goods are always going up, at least to an extent, even when inflation is thought to be in check. It is important to note that some amount of inflation is considered normal because of its relationship with unemployment, some inflation is actually desirable. While the annual rate of inflation has fluctuated greatly over the last 16yrs, ranging from nearly 32% inflation to 11.2% inflation, else where they actively try to maintain a specific rate of inflation, % but can vary depending on circumstances. Deflation (for example, -1%) occurs when prices actually decrease over a period of time. Please note that deflation is not the same as disinflation, which is when the rate of inflation decreases but stays positive (for example, a change from a 11.2% rate to a 5% rate).
    Mwaice Easy this the meaning of Hyperinflation: Hyper Inflation :A period of rapid inflation that leaves a country’s currency virtually worthless

    How Inflation is Measured

    There are two main indices used to measure inflation. The first is the Consumer Price Index, or the CPI . The CPI is a measure of the price of a set group of goods and services. The “bundle,” as the group is known, contains items such as food, clothing, gasoline, and even computers. The amount of inflation is measured by the change in the cost of the bundle: if it costs 5% more to purchase the bundle than it did one year before, there has been a 5% annual rate of inflation over that period based on the CPI. You will also often hear about the “Core Rate” or the “Core CPI.” There are certain items in the bundle used to measure the CPI that are extremely volatile, such as gasoline prices. By eliminating the items that can significantly affect the cost of the bundle (in either direction) on a month-to-month basis, the Core rate is thought to be a better indicator of real inflation, the slow, but steady increase in the price of goods and services.

    The second measure of inflation is the Producer Price Index, or the PPI . While the CPI indicates the change in the purchasing power of a consumer, the PPI measures the change in the purchasing power of the producers of those goods. The PPI measures how much producers of products are getting on the wholesale level, i.e. the price at which a good is sold to other businesses before the good is sold to a consumer. The PPI actually combines a series of smaller indices that cross many industries and measure the prices for three types of goods: crude, intermediate and finished. Generally, the markets are most concerned with the finished goods because these are a strong indicator of what will happen with future CPI reports. The CPI is a more popular measure of inflation than the PPI, but investors watch both closely .

    Inflation and Your Investments

    Inflation is greatly feared by investors because it grinds away at the value of your investments. Put simply, $100 today is not the same as $100 in 1 or 10 years. It is crucial to include measures of expected inflation when calculating your expected return on investment. As the most basic example, if you invest $1000 in a 1-year CD that will return 5% over that year, you will be giving up $1000 right now for $1050 in 1 year. If over the course of that year there is an inflation rate of 6%, the purchasing power of $1000 has decreased by $60, and you have actually lost ground! (Of course, the capital gains taxes you pay on your “gain” will increase this loss.) If you had spent that $1000 instead of investing it, you would have been able to purchase a larger bundle of goods than was possible with the $1050 you earned a year later. However, this is not a suggestion that you spend your money instead of saving it. First, the reasons to save are too numerous to list, but a home and retirement should be enough to inspire you. Given that savings are important, inflation eats away at your purchasing power more if you just put your savings under your mattress than if you had invested it. Now that this issue has been clarified, it is important to be aware of the effects of inflation on your investments. Whenever you can, try to determine your “real rate of return”, which is the return you can expect after factoring in the effects of inflation. If you are working with a financial professional, ask him or her for an estimate of the real rate of return of a given investment or portfolio. As explained, inflation can erode the value of cash investments, such as stocks, bonds, and CDs. However, some people believe that investments in real goods, such as a home, are protected from inflation. This is because the value of a real good is determined to a large extent by its intrinsic nature, as opposed to money, which is valued only for what you can trade it for. If inflation is high, the price of a home or a car may simply increase at a similar rate, insulating it from price erosion. The same cannot be said for a 10-year bond. As a result, some investors seek protection from inflation, and investment options which do just that are becoming available. The most popular example is TIPS – Treasury Inflation Protected Securities. These investments are just like bonds except that they are insulated from the effects of inflation .

    The description above explains why investors follow CPI and PPI reports so closely. In addition to being aware of the current rate of inflation, it is crucial to be aware of what inflation rate the experts are anticipating. Both the value of current investments and the attractiveness of future investments will change depending on the outlook for inflation.

    Inflation and Unemployment

    Many modern economists believe that inflation is inversely related to unemployment. This relationship is shown through something called the Phillips Curve. The Phillips Curve shows the relationship between a given level of inflation and the expected level of unemployment that would go along with it. As inflation decreases, unemployment is expected to rise. This relationship is why you hear about the Fed’s dual tasks of keeping inflation in check and maintaining full employment. Economists agree that there is a minimum level of unemployment that an economy can handle without causing inflation to accelerate .

64. AM u c I told you not kuya kumanda nomba wamona walenga ati Penza wabuke. Did you hear he lastest he made an expolation in Kaleya to have someone guard his grave. Pity the boy is only 12. Citizen dont divert from the topic look the lies in from Chapi about Inflation he is bringing us figures from 1948. In the European union if you inflation shots 3% you recieve a blue letter from Brussels. So the Ba #60 Chapi false data where did you get. Its just yesterday when they were assumptions that milk prices are likely to increase. In the EU all members has to meet the conditions of borrowing which should not be more than 60% of the nation budget.

65. #65 Kuku Mudala, we have to keep the debate hot kaili ZIM ati they have Hyperinflation I wanted to see the reaction of our monitors and indicators ba blog. About the Philip-curves it only worked for Ronald Regan and Magi Thacher in the 1980s. The situation today is different. How about brain drain or employment flight how can you calculate that? In some cases we have food inflation or food deflation in Zimbabwe where the money is not longer a medium of exchange and store of value pipo are going back to barter system. Also e-cash is more important. ati shelves are empty in Zimbabwe but you wonder what pipo are eating all these 7 yrs.

66. #64 sorry I meant you

67. Iwe Mwaice Easy #66 that is why I was so specific in my last paragragh for SAGE who is in USA and I quote “This relationship is why you hear about the Fed’s dual tasks of keeping inflation in check and maintaining full employment”. end of quote.Your Zim forcasts for Infaltion at the end of the year is being looked at 100,000%,if RGM will stand that ninshi mwana wa ndoshi kwati HK,Mwaice Easy brain drain is just a small fraction and its not every sector that is affected.Zambia’s employable age is 4m plus but out of this only 500,000 are in formal sector,the only worst hit sector is Health as regards brain drain, but else where the figures are not so bad so that does not affect the EI but the level of unemployment is what must cause case for worry.
    Also Mwaice Easy see#59 on what Magande and Fundanga wants to do when the rate hits 5%, you return to using K10,K20,10n etc,but RGM does this mechanically

68. #67 go on sky.com/news and see how Zimbabwweans are sufferring trying to cross to RSA.Its shame, that is why Mbeki’s brother yesterday on sky news was saying Mbeki’s govt are in denial of what is happening in Zim.Its a shame and then day dreamers like Gaddaffi are busy advocating for one Africa govt.Nomba naya mukomona ba Joze ku Kabwe,we shall link up later.
    BaJoze nalapula Kabwe in the next 3hrs.See you pa Elephants.

69. Easy

    Too much ama ilele mwisho. Try copy and paste may be we can see your intelligence, otherwise buy Rufqah @ $400 @ interz and kolima towerz from AM, Kuku and jose

70. Citizen & Easy do not understand macroeconomics and no wonder they seem to live in constant loss of memory concerning Zambia’s economy. In 1991 inflation was almost 200% and interest soured to 120%. Where was Magande when Zambians were queuing for basic essential commodities like sugar and soap?

    If you have memory at all you will recall that prior to 1991 elections Zambia had lost its financial relationship with the Breton woods institutions due to Dr Kaunda’s policies. At least you should remember that Dr Chiluba was President 1991 and late Penza was Minister of Finance and together they worked tirelessly to restore donor confidence.

    Can you tell us one economic success LPM govt has achieved apart from persecuting political opponents and protecting his tribesmen like Chitoba at DEC.

71. #70 M´kulupe you didnt understand my points that is why you are trying to tease me. Talk what you know. Ba Jose he want me to buy shares ku Kulima tower nomba company name ati shani?

72. There goes a patriot. The combat never loses its principles

    DON’T INCITE ZAMBIANS-CHIZYUKA

    Namwala Member of Parliament, Robbie Chizyuka has urged the Oasis Forum not to incite Zambians to demonstrate against the constitution making process during the forth coming SADC heads of state summit to be held in Lusaka next week. Major Chizyuka told ZNBC News in the Zambian capital, Lusaka, Wednesday that the heads of state who will attend the summit should be left alone to handle the agenda of the meeting.He said the leaders should not be antagonised with Zambia’s constitution making process. Major Chizyuka said, it is the responsibility of Zambians to handle their domestic problems and not visitors.He also advised all political parties to stay within the Zambia Centre for Inter party dialogue and argue their grievances within the body. Recently the Oasis Forum indicated that it will demonstrate against the constitution making process to the heads of state who will attend the SADC summit at Mulungushi International Conference Centre in Lusaka.

73. Truly Zambian- please learn to give praise where its due, its not about a tribe or an individaul its all about team work. everyone of us has played a role in bringing down the inflation rates, the best you should do is to thank youself for the sacrifice you made.

74. #71 Truly Zambian, what Zimbabwe is going thru now is what was happening to Zambia in the run up for 1991 elections. This is a weapon or machinery used by the your Breton woods institutions the WB and IMF. Thank God things have changed worldwide. So you ci Truly Zambian you are made to believe that its was Kaundas policies. Are you real a Zambian? Not a normal Zed can support you and your Chiluba come 10.August and you will see your old man paying for his misachievements. If this is your Macroeconomy then Iam sorry nowonder you are out of office with yout FTJ. You should have joined PK chisala today your tammy would be full.

75. #71 Truly Zambian
    I am lucky I am not like you whoe spends more time theorising and bunding about terms and figures as a measure of economic performance. I see and measure the economy from a very practical point.
    I will give you only some examples;

    It is only now when you are seeing banks advertising and begging individuals and companies to get loans with minimum or no collateral at all.

    Investments in the tourism and mining are increasing to unpresidented levels.We now have more than eight international flights into Lusaka a day. Employement in the mining and tourism sectours has quadripled.
    The construction industry has become active again.
    People seem to have more disposable income.
    Employment formal levels are increasing

76. Kuku & Easy,

    Be careful you are spending too much of your time on the blog. My research has proved on average you are here every other 45 minute around the clock -24/7. I don’t think that is normal or productive. You are proving a bad example to the young ones on whose shoulders the future of this country depends. If you have children or spouse, you risk losing them. Family time is very important. 85% in the kids’ learning curve is from what they see their parents do. You could be building a disaster in your household should you kid adapt from you the 24/7 bogging devotion. Even fully paid up bloggers are not that sticky in blogs like you. They blog and take off for other social and economic interests. I’m not trying to discourage you but register my brotherly concern. Do it but with a sense of self regulation so that life balances. Time is too precious to be wasted just like that. Increase your value out of every minute. Otherwise, the haves and connected will continue having more and more.

77. I think the Government/BOZ is supposed to spend more time talking about micro issues, the nitty gritty of our daily lives rather than boring us with figures that make little sense-if any- to lay men like most of us on this blog. I would rather hear what Gov. has,is and will do to reduce poverty.#1 PRAGMATIST is commending the Governor for being a rhetor. Thats nosense, we have heard enough of text book economics, we need food on our tables, not to mention shelter, social services, schools,water, the list goes no. Zambia needs real pragmatic leaders who are prepared to forgo a Prado in to build just one simple house for a teacher. Next time he opens his mouth, i want to hear prices are falling in line with the falling inflation, otherwise let him shut his mouth up and wait for his salary at the end the month and the open it to eat. Very disgusting.

78. #77 imwe ba senior citizen bakamba, be senior in your brain as well like ur name, u’re elder brother of ci Citizen Mushebwa te, you dont know that Ba Kuku is the Boss of bosses, and he is aspiring to be the next Presdo for zed, thats why he u feeds with progressive ideals. For that matter, he has already done his part in life, he has done all the work he needed to do and he has has produced all the children he wanted, so what more do u want him to do. He is got workers, working for him at main masala. As for Easy, abafye pa easy umwaice.

79. #77 Senior Citzen, have ever heard about Time Management, Planing, Adventures, Leisture, Recreation, ICT or Lean Management, May to be precise Just in Time. Do you know google offers a calander and Time plan space? Are you aware of video conference, Remote connection, what else can I say. Manage your time and make plans then you will always have enough time to for activities. Senior I am a parent and I have time for my kids. So you should not worry. 24/7 blog you should have asked when do I sleep? You missed the point. Do you that when you are sleeping others are busy working and making backs. I dont need to be paid for write on the blog God already open the doors for me for everything. Committment is vital no gaps make use of all the time you have. Do you that I also do some sport to keep me health. Do realise that I read books too to give you all these information. Iam also practical on the ground to transform some of these ideas. Thank you for the concern but it shouldnt bother u

80. Senior citizen, Go other topics and see how Pragmatist is terrorising the blog. Nashibuka Ingulu nakaili

81. Vertran 44/45- sorry bane,kwacha is bemba,meaning in the dawn and ngwee is chewe- nyanje.Even if you open the net on Zambia,it say,s the word kwacha came from the language bembe.So please we should not run away from the truth.We have to change some of this name’s

82. Ba Jose mwamona ubushilu bwakwa Pragmatist ifyo buchita nomba #83&84. Wina azafunta muleti chaseko. Chainama is calling u Pragmatist, can u pls hear the calling and respond.

83. Emwe babuli kainyelene panse. Get out here with your rubbish.

84. Easy my brother has it come to this ?.

    You know that in even in the midst of this lunacy, we must maintain sanity. Or have you gone overboard like AM ?

85. Ewe Citizen, leave us alone we are flowing in Rufqa tongues nomwina myandi Easy

86. As for Jose his we all know that his mind departed from him a long time ago .
    He is know a pious wanderer and heretic with emptyness in between his ears. Funny though he seems to attract followers the way a magnet attracts iron fillings

87. ka Citizen,
    kabiye uko. i have the right to attend to my love haven’t you headar ba Senior chimochimo gifving me isntrusions for famiry timie?

88. I refuse to be assorted with such rubbish, I know it is the work my enemy like ci Citizen necikalamba cakwe ciSenior Citizen, ciPragmatist, ciHK or the Monks of this world.

89. Ulembele mu #90 ni KOLWE neci PANTO.

90. #92 Easy
    I understand that your mind is doing mental gymnastics, but I am confident that we still have a reasonble chance of retrieving and rehabilitating you from this affliction. I am consulting with DR mengele sorry Dr HK

91. Easy, love love from me for you.

    Hubby

92. I see a big confusion in our debate about inflation. Declining inflation DOESNT mean prices are falling. It means that prices are INCREASING at a slower rate. In estimation of inflation in Zambia, the CSO do have a robust enterprize following international standards by which they collect prices of goods across the country. When I see prices of most goods from food items to consumer durables I tend to agree that inflation is down. I still buy a mealie meal, TV, cooker at about same price as I did in 2004. Those who are saying inflation figures in Zambia are cooked up, can they give us examples of which commodity price has say doubled in Zambia over the past 1-2 years.
    Finally, the exchange rate cannot be a more important economic indicator. The reason why some Zambians may worry more about it is simply that inflation is already down. You wont get a stable (market)exchange rate with hyper inflation. What we need is a stable rate, whether its K50,000 or K5 to $1 absolutely doesnt matter

93. 94# AM
    This is more serious than I thought . Apart from insanity you are also exhibiting a split personality.The only one who can cure you is that women in kitwe’s Buchi township.

94. HK Doctor wa mafi (Doctor of feaceas)

95. Ka Citizen go and get cured by your doctor of feaceas HK. Dont u impersonting me, u dokya wa dobo. I am out of here for now. Shala namafi wobe.

96. I came here to join the debate on inflation only to find Easy and AM on madness riot in languages i can’t figure out. To make matters worse, they are revealing their sexual pervasive orientation. Earnestly is Gayism all you could learn from the Diaspora young men? Brother Easy you could have listened to the words of wisdom of ba Senior Citizen. Seriously look at the results of your addiction to the internet.Do we have any spiritual counselors here. As a country we have lost again. Besides HIV aids honestly even the internet should become another robber of our youth?

97. #60 Chapi you also forgot to point out that the unemployment in USA is @ 3.7% . There has to be a correlation between unemployment and inflation. Unemployment directly affects the purchasing power of a nation. if 80% are un employed and the inflation is 8.2% something is amiss somewhere. EASY go to BOZ or Ministry of Labour they will tell you the unemployment rate is between 76 and 81%. They release these figures, we not just pulling them out of thin air. And by the way kids are supposed to participate in the commerce of the country. If you dont i suggest you start giving you kids allowances. Most people make their kids earn these allowances by giving them minor duty like washing your car, watering your garden or taking out trash. McDonalds is in business today because of Kids and they are Lovin It.

98. I am yet to see a posting where Truly Zambian #71 does not mourn about imaginary TRIBAL problems.
    So may people have advised ba Easy on his apparent english language problems, but the real issue may be that he does not comprehend these messages either.

99. My dear friends dont be disgruntled the real Easy will never write arabic. This shows just how imbicile and *****ic some apes are on this planet. Those who know my writing style can easily understand that rubbish cannot come from me. This is Pragmatist and junk tricks on the blog just give me time I want to expose this mental sick chaps. A technocrat like me will never right such useless things. Just check my contribution there is wisdom and educative. Not the paragaunt, blind pofus of chainama. Pragmatist to you us to trace you time and location where you are posting this nonsense. God forbids dont force us to bring you behind bars for a offence you can afford. AM dont follow this confused fellower ignore him he is sick, frastulated and wicked. See what Kuku wrote about Satanist this is the work of the evil and the devil.

100. #101 Serviceman (Rtd)just ignore the new Easy because he is no other than Pragmatist who has nothing to do in his life as just to insult. #97 Francis dont get confused bring out the data about prices in 2004 and 2007. Kuku is a meeting in Kabwe he would have done this because its his area. The fact is we should look at the Balance of Payment and how it looks likes whether we have a surplus or deficit then we can determine how these inflation figures are coming. Emplyoment opportunities are starting to come up. You HEY what is wrong with you I dont want to have a masters in English all what I want is that you understand my Zangalish or the new Bemlish. Otherswise I will start using Luvale.

101. #102 SAGE that is child abuse. My children will wait until the are 16 yrs. So you dont even know how muc unemployment rate has Zambia as now?

102. Easy i told you go MOL or BOZ these figures are their. If i may ask which country are you living in at the moment?

103. #102 SAGE can you give data how many farmers has USA? You are forgeting that most of the population has been subsistence farmers. Do you call that employment? IN Zambia about 4 Million are adults of which 500 000 are on GRZ Salaries. Then we have private firms how much has Zambia Sugar for instance. Ba Jose should tell how workers does he got pa ka NTemba not only Astrida

104. #107 Dispora SAGE just like you

105. SAGE how is the excise duty in Zambia? This determines the price of a commodity not Inflation. Inflation is just an indicator. So if we have many processing firms well the better we can talk about the employment creation.

106. If you are in Diaspora how come you dont know that we give our kids allowances and slso that we give our kids minor tasks at home for them to earn extra cash for movies and any etra entertainment they may need. This priciple is widely exercised in the US. Its designed to teach kids that you can only earn money through work. Thats why you dont see your American friends asking for money from you like we do back home. Its a culture that has been developed over centuaries. Knowing what you know now would you still clasify my suggestion as child abuse?

107. Sage, Francis, Serviceman(RtD) we have to talk about when a market reaches its Equilibium. What are the factors influencing this becuase Inflation alone is not helpful we need to apply microeconomics as well look at how many pipo are local firms are able to employ in every quartal or a year.

108. SAGE a kid of 3 to 12 can not go to kino alone what kind of parenting is this?

109. EASY lets be coherent in our discusions. I dont recall anywhere in my posting stating that a kid of 3 can go to kino alone. But a kid of 6 to 12 can take trash from the house to the dump. You dont seem to grasp what i’m talking about here do you?

110. Obviously there are 2 people going by the Easy name.The new easy is quite different. I dont know which one is the imposter.

111. #114 SAGE so you say you have to pay tis minor for doing this job. I thought its part of upbringing. Come back to novices of Inflation before you get confused.

112. call me nshinya citizen as my new ID

113. The minor in this regard is the duty “Minor Duty” meaning light work. I think we have a language problem here. I wonder how we are going to understand macro and Micro economics.

114. Easy, can you make yourself clearer? I think we could discuss issues more interestingly without being too academic about inflation.

115. #119 check above 112 my question is not anwsered. I want always to be practical not books. Iam talking about excise duty? How is it in relation to Inflation because it affects the prices of goods and services. With SAGE he just find an excuse because he was talking of children working in Africa. It all started with the ? of many pipo are eligable workers in Zambia with apopulation of 11 Mios?

116. Also my question the effect of Balance of payment has not been answered? SAGE we should about facts. We need factors which can lead to creation of employment. What are these?

117. Also my question the effect of Balance of payment has not been answered? SAGE we should about facts. We need factors which can lead to creation of employment. What are these?

118. Definately if cannot take in account the Laws of Supply and Demand our Micro/Macro econometrics will be meaningless.

119. Francis answer the ? what are needs and wants? This is simply language. Once we can identify our needs then we can know which route we are taking.

120. haa ha ha

     I will never use my ID as “senior citizen”

     More tobwa, more coke, more more more daggaaaaa. Mufana wanga citizen bend over.

121. I’ve just seen SAGE i believe is talking about work ethics. Obviously anyone outside 18-55 year age bracket isn’t part of labout force. But i agree a national work ethic taught early in life impacts adult employment.
     Inflation is a collection of prices of goods traded in various markets. And each of these free markets is assumed to be in equilibrium. If govt interferes, the black market will mushroom to force equilibrium. So the price of bread at K3,000 is what buyers and sellers have ‘agreed’ to be the fairest. Problem is as others have said, this equilibrium occurs at a point when employment is too low. So to raise employment, you move the supply side of things (low interest, low taxes, better education and health, more investment). If you can do this with little inflation, then you have equilibrium at a higher level of employment. In short, i agree we also need higher employment to appreciate 5% inflation. And i have my doubts that stringent inflation targeting will deliver it

122. #120 EASY. The issue here is understanding issues with in context. You are confusing asking your some to clean up his bedroom with child labour. Suprisingly you are in the states. My son gets $10.00 every two weeks as an allowance. But if he he wants to buy Xbox spiderman 3 video game he has to earn the extra $45.00 bucks for him to afford the games he wants. He cleans his bedroom and he also takes out trash in morning to earn the $45.00. You have to understand we are trying to create a work ethic and concept that money does not grow on tries in these kids. Do you know how many billions kids put in the economy evry year? I know a kid 10 years old who has started a lemonade stand to support his charity. My friend the list is endless.

123. People won’t eat numbers. we need jobs, good health care like the one ministers enjoy, good schools for our children, good retirement packages…we’re simply asking for the basics!numbers to impress IMF so that you can access more loans and steal! bakabolala bachabechebe! tayeni uko!

124. Easy i havent got your question in 122/124?

125. Eastern Power, jobs wont just rain down like manna. You create them with specific policies and resources. The govt is least able to provide jobs directly unless the economy is healthy. To make the economy healthy you have to reduce inflation, first and foremost. This is real life.

126. Easy I love you come and fxxx me since you are missing it at home and spend more more more time on internet. I have just finished doing xxx with mufana wanga citizen, alema.

127. Francis & SAGE you are missing the point. What kind of an Account is Fundanga making his statement? When you talk of equilibium you are talking of a
     Current Account + Financial Account = 0
     A Balance of Payments Equilibrium is defined as a condition where the sum of debits and credits from the Current Account and the Financial Account equal zero. For Fundanga to talk about lower inflation a Balance of Payment should have Surplus or a deficit. So where is your point how can we reach this 5% Inflation which our current account is still by debt servicing, grants, aids, help etc. So you guys you make your children work for the money you give them. What a bad culture. Why let reach 16 and they can be able to earn there own bags. So SAGE tell me about your 3 yrs daugther who need a toy is she going to dump the bin to get one. I dont think its a good culture. DOnt be slaves of money be masters of life.

128. As dato 2006 Fackbook World Bank 64 countries are in surplus, while 99 countries are in deficit. Zambia is one of the them with – 165, 4 Million deficit.

129. # SAGE I was talking of what factors can lead to creation of employments? Pipo need food on plates on figures.

130. Easy, you’re crazy. BOP can’t be in surplus or deficit thats just totally illogical.
     Now let me end my contribution to this issue by saying this. Zambia is an open economy vulnerable to external pressures. So if our reserves are running low because of low foreign earnings or high imports(which might create a BOP crisis) BOZ could try to keep exchange rate from depreciating in order to keep inflation down. This potential fixing of the rate can cause our economy to come under perverse speculative forces. Remember we had this talk about some people sabortaging our exchange rate when the kwacha appreciated massively in 2005-6. Good, BOZ didnt mess around with it. Low inflation achieved by minimal govt profligacy will mitigate these external effects, NOT artificial exchange rate fixing. And your BOP will come back in order.

131. EASY first this is the definition of balance of payments..A systematic record of a nation’s total payments to foreign countries, including the price of imports and the outflow of capital and gold, along with the total receipts from abroad, including the price of exports and the inflow of capital and gold. I’m not an economist but i have enough knowledge to understand basic economic indicators. I also understand that if you are talking about 8.2% inflation and 80% unemployment and more than two thirds of the population living on less than $1.00 a day. Bearing in mind that the line at western union is longer than the lines in all banks put together. something is wrong with this picture. EASY for your sake learn to read and understand what someone is writting before you respond. I clearly stated that a kid between 6 and 12 can do light duty at home. And i also mentioned that i give my son $20.00 a month. so what part of this dont you understand?

132. Back to inflation. for those of us who are not economists this is the definition of inflation….A persistent increase in the level of consumer prices or a persistent decline in the purchasing power of money, caused by an increase in available currency and credit beyond the proportion of available goods and services. And this the definition of the inflation rate…the rate of change of prices (as indicated by a price index) calculated on a monthly or annual basis. With out even going into major details i believe BOZ or GRZ have their own definition of inflation.

133. how is Core inflation in Zambia? Sage had fundanga taken into account of this? #135 francis will disinflation affect our economy. sage how do measure your $1 per day when most pipo.Sage You are be unfair to the Bambins are investing as well in the childs future. Like making saving for him so that when he starts his own life he has starting capital.

134. I meant when most pipo has no salaries.

135. Inflation is an upward movement in the average level of prices. Its opposite is deflation, a downward movement in the average level of prices. The boundary between inflation and deflation is price stability, disinflation is the reduction of the rate of inflation, hyper-inflation is an out-of-control inflationary spiral, stagflation is a combination of inflation and rising unemployment and reflation, which is an attempt to raise prices to counteract deflationary pressures. I think is much simply to understand. So you can choose which is the situation for Zambia.

136. Zimbabwe is to start circulating a new 200,000 Zimbabwe dollar note, in a bid to tackle the country’s inflation, the highest in the world.
     The new note, issued by the Reserve Bank of Zimbabwe from Wednesday, can buy 1kg (2.2lb) of sugar.

     Food and fuel shortages have become common as the government relies more heavily on imports, pushing prices to new heights.

     The official annual rate of inflation in Zimbabwe is more than 4,500%.

     In practice, this means the price of a loaf of bread costs 50 times more in cash than it did a year ago.

137. EASY that is exactly the point. 80% ZEDIANS HAVE NO INCOME.. How can you be talking about inflation if people cant afford even to buy basic necessities? If you look at the production levels in Zambia and just reduce the unemployment to 40%. There inflation rate will be more than 50%. Thats why i tell you book economists to start using your brains and not kidneys for thinking. Until we can practically create jobs and uplift peoples lives these economic indicators are just academic numbers for you loosers like show to the donors.

138. #141 KC why bring BCC news these boy are kachepas that is why they not allowed to report from Zimbabwe. This just drama I hope SADC should move in quickly to avert this west bullets which infested Africa for years.

139. #143 SAGE I thought you will come with answer which will clear things but there you go. The 40% are children who are being kept in someway by those who earn money or they get support from Government this is how this $1 issue comes in. This we had floods and Govt had to airlift food to affected areas.

140. SAGE #142, I dont agree, economists try to describe to us whats happening to the society’s economic system. They also advise what to do or not do if you want economic prosperity. But economists DONT create the economy. I posted an opinion about figures up on #97 somewhat defending the indicators. I think there are many many other indidators of welfare you can choose to use. BUT the data even there wont tell you anything too different: if you have hyper inflation, low production, high interest rates, you will have few jobs, more poverty, low skills, etc.

141. The cost of living is the cost of maintaining a certain standard of living over time this all we must determine when we are talking of Inflation. Are pipo able to buy basic needs and services? A cost-of-living index, such as the Zambia Consumer Price Index cannot measure a price index that conceptually measures the cost of living. Such indexes have 100 as base value in a given year(or period), the base year. Other values of the index are relative to the base year. An index value of 40 indicates that the cost of living is 40% lowe than in the base year. Thus, the index provides no unit-free measure of the cost of living. Instead pipo have to pray to nature and continue hoping the the next day the sun shines.

142. Nothing wrong, all the indicators are as good as we are doing.

     Economists have boldly said that the Zambian economy needs to grow 8-10% per year consistently for the next 10 years to produce the kind of welfare impact ordinary Zambians want to see-high employment. Politicians dont have the guts to admit, let alone say this to the people. Right now, we are growing at 5-6%, meaning you stretch it to 15-20 years. No magic bullet. To be fair, we’re doing this for our children.

143. #145 Francis what is important is our needs. So I leave u with Maslows hierachy needs. Water, Food, Air, Sleep, excretion and homoostasis. Safety in terms of our bodies,employment, resources, morals, family, health and property. Family, friends, respect of others, confidence, achievement, morality, creative, equal chances, problem solving, accepting facts.

144. Needs are subject to economic force of price, so on their own they are useless concepts. Even health is subject to affordability otherwise we wouldnt be losing 25,000 kids each year just because we cant afford a $4 mosquito net. Its harsh but its life.

145. #143, ba Easy, this is a hard reality that Zimbabweans are facing.Whether BBC are kachepas or not, the current situation in Zim needs immediate attention.How much more does the economy need to crumble for you to see how bad the situation is?Sometimes we need to learn to call a spade a spade.

146. Important Quotes from Kabwe Elephants Head Hotel
     World Economy
     FIVE major risks threaten the world economy. Three centre on the United States: renewed sharp increases in the current-account deficit leading to a crash of the dollar; a budget profile that is out of control; and an outbreak of trade protectionism. A fourth relates to China, which faces a possible hard landing from its recent overheating.…
     Tony Blair’s Experience in his recent visit to Middle East
     TEN years ago, if you had told me I would spend a significant part of my premiership on foreign policy, I would have been surprised, a little shocked and probably, politically, somewhat alarmed. Even today, we all run for office concentrating on domestic issues. “Foreign” policy rarely wins votes, and can easily lose them. Yet nowadays the reality is increasingly that we are obliged as leaders to think, work and act internationally.
     Over ten years I have watched this grow. (If you had told me a decade ago that I would be tackling terrorism, I would have readily understood, but thought you meant Irish Republican terrorism.) The line between “foreign” and “domestic” policy is being blurred. Climate change is a big issue in developed nations’ politics today. It can be beaten only by global action. What happens today in Pakistan matters on the streets of Britain. Mass migration can only partially be managed by individual nations’ internal policies. Economies are shaped by forces of globalisation.
     Weirder worldwide weather
     Freakish phenomena are becoming less freaky all around the world. South-central Europe is fighting a heat wave fierce enough to cause forests to combust. In China, India and Pakistan over a thousand have died in floods in the past few weeks alone. Global warming may be changing the world’s climate but personal and political choices determine how much damage it can do.
     Building on sand
     Time to use insurance to stop people building on flood plains

     Reuters
     NO ONE in his right mind would build London today where its founders did. At the mouth of the Thames, it is threatened by the rush of water when there is flooding inland. On the edge of the North Sea, it is buffeted by sea surges when storms blow up offshore. The supremacy of water-borne trade that once dictated its location has ebbed: the cranes that dotted busy docks have given way to financial skyscrapers, trendy watering holes, “affordable” housing and excavations for the 2012 Olympics.
     London is lucky. The centre of modern Britain’s wealth, it has been powerfully protected from the sea by the great Thames Barrier, and against trouble upstream by sturdy cement dykes. Not so Tewkesbury, Gloucester, Oxford and other towns in southern England, desolated this week by river flooding on a scale not seen in 60 years (see article). Not so Sheffield, Hull and their Yorkshire neighbours, which suffered even worse inundations after heavy rainfall a month ago.
     Smelly old SOX
     Sarbanes-Oxley is not as bad as it’s cracked up to be

     Satoshi Kambayashi
     FIVE years ago this week, in the aftermath of the Enron and WorldCom scandals, George Bush signed the Sarbanes-Oxley Act into law. The president needed to restore public confidence in corporate America and to inoculate himself from accusations that he was too cosy with dodgy businessmen, such as his ex-pal, the former Enron chairman, Kenneth “Kenny Boy” Lay.
     Today, SOX, as it is known, is widely reviled. In boardrooms across the world’s mightiest economy, it has become shorthand for foolish, heavy-handed state interference in the wealth-creating marvel that is corporate America. The cost of complying with its requirements, it is said, has been far higher than predicted. It is blamed for promoting risk aversion and mistrust in corporate boardrooms, driving a growing number of public companies into the clutches of private-equity firms, and undermining the global competitiveness of America’s capital markets
     China and Darfur
     The Sudanese government has just explicitly declared the unconditional acceptance of the third phase of the Annan Plan and reached agreement with the United Nations and the African Union on sending a hybrid force to the Darfur region. This positive development is attributable to efforts made by all parties concerned. The Chinese government of course has made its own contribution, which is widely recognised by the international community
     USA minimum Wage & General economy
     The minimum wage in America increased by 70 cents to $5.85 an hour, the first rise since 1997. The legislation was promised by the Democrats in last year’s mid-term election campaign.
     A weak job market may be behind this malaise. Though America’s headline unemployment figure looks impressively low—4.5% in June—this is misleading. Other indicators, such as labour-force participation and real-wage growth, paint a picture of a job market where labour demand is less than robust. According to Jared Bernstein of the Economic Policy Institute, participation in the labour market has fallen most sharply among disadvantaged groups, usually the first to drop out of the jobs race when labour demand slackens.
     Inflation of the prices of key commodities, such as petrol, is also cutting deeper into pay-packets, forcing Americans to eliminate discretionary purchases. And the nasty combination of falling housing prices and rising interest rates is forcing many new homeowners with variable-rate mortgages to slash their budgets everywhere else in order to meet their rising house payments. Even so, defaults have climbed precipitously, particularly in the subprime market

     It doesn’t add up
     Fears that China’s economy is overheating are exaggerated

     CHINESE students may come top of the world league in mathematics, yet the country’s economic numbers are notoriously dodgy. New figures showing that China’s GDP growth quickened to 11.9% in the year to the second quarter, its fastest since the mid-1990s, while inflation jumped to 4.4% in June from 3.4% in May, have fuelled concerns that its economy is now seriously overheating. However, a closer inspection of the numbers suggests there is no need to panic—yet.
     China is always one of the first countries to report its GDP after the end of each quarter. But speed kills accuracy. Each province later publishes its own growth numbers, which have consistently averaged higher than the national figure in recent years. Moreover, if you add up the main components of GDP—investment, consumption and net exports—you also get a higher growth rate.

     Thanks to such inconsistencies, many China-watchers track alternative proxies of growth. Jonathan Anderson at UBS uses one based on production (industry, electricity, construction, transport and agriculture) and another based on real expenditure (household spending, fixed-asset investment and net exports). Curiously, neither gauge shows an acceleration since 2003-04. The growth in electricity production rose broadly in line with GDP during the first half of this decade, but the economy’s apparent surge since 2004 has not been matched by faster growth in electricity
     So what are Chinese number-crunchers up to?

147. #77 Senior citizen,what a shame,when did you become a Sr.Citizen?Listen the work culture and patterns are changing with modern high tech.I can work from anywhere and when I have a chance I log onto LT.You seem to be talking from experience, what happened to your kids and spouse?You are the kind of lot that wastes energy and time on the net watching porn,no wonder you wife left and now you want us to be like you.My friend us we are serious entrepreneurs who have worked for our money and lead super comfortable lives and continue to thrive.Continue dosing in diaspora, ukesa lala ku cimuti.Iwe kuti uleiba ifwe ati we spend more time pa blog?Ulicikopo sana,you are the people George bush will tell to go and grow your hair on tha bold head of yours.My kids are the most adorable on this earth and they school in chengelo not iwe your kids go to those state schools to just learn insults and dobo.come on man come back to your senses dont just speak act.Read quotes from Kabwe on #151,Nayamukutusha

148. #79 Ba AM uyu muntu alecula sana , mailo mu meeting afwile aba pa agenda.Satana akwata fye itoloshi limo,ala mu car park.We need to send him SOS funds from our balance of payment account so that akabwele ku USA, abakashi balimubutuka taishiba nokwaya abana, lisebenya lya muntu.And from the grape vine this chap is 62yrs, imagine languishing in a foreign country.Dont worry, we will take care of you.But can he work at Kulima Tower? He needs to be in a nursing home,we need to critically look at his fate.As usual you know our Kulima/Masala hospitality.Nacendefye bwino pa Kabwe, nomba nasanga pa blog palifye cimbicimbi, kanshi aba abalumendo ba dobo balepela kwisa?See tommorrow.Mwaice Easy tushako naiwe ulimuntu ulanaka, let the Arabs take charge for now.Sala maleko

149. Ala paba amashilu pano pantu mwee

150. Ka Kuku kale satabukafye nombo. Ebushilu ubobwine.

151. Magande is the best FM Zambia has ever had.Inflation=8.2% and heading towards 5% Unemployment=1%.We also have skyscrappers,alot of shopping malls have been constructed with underground parking,Freeways(6 lanes each way) connecting all cities(no pot holes),National airline,Internet access is free coz it`s now available in all public libraries,Pensioners have all been paid,LUSE is among the top 5 Stock Exchange in the world,KWACHA has stabilised and is now 2 British Pounds to 1 KWACHA.The Judicial system is the best in the world and cases are now handled expediciously and LPM has finally returned the land he grabbed from UNZA.

152. sophist, mwaice politics is not my cup of mosi, may be medicne (psychiatry) so see me at Chainama helping my fellow Zeds.

153. Easy in response to your question about where I got such ridiculous data from in #156.This was from Zambias best selling book called MAGANDENOMICS and was passionately confirmed by the MMD CHIEF Strategist on this blog who always uses the word “TROLLING” and mis spells my name as SHAPI.

154. #154 Chapi I never asked you about this data we are talking of Inflation. Its a pity you lack economics background. I thought in Msc in ICT you cover diverse topics because you are aspiring for management level. Kuku teach these young men a bit of Marketing MIX so that the can understand terms like price. If that wont be enough send them to me will give them lesson on the 4Ps and beyond. If wont understand I will can the formula and apply SIVA if not enough I will teach them Marketing and beyond. #38 SAGE your assumption that 80% of the population dont particiate on the commerce in Zambia is unfounded. What I know is even a villager uses Kerlosine for lightening they have to buy hence the one $1 per day. Kuku your meeting was a such and those are the real problems facing the world today. Tell Sage to stop child abuse see what he said above about his Minor Duty and kids in the USA. This child labor and its misused.

155. No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and Mammon. Matthew 6:24
     For the love of money is the root of all evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows. First Epistle to Timothy 6:10
     If you want to know what a man is really like, take notice of how he acts when he loses money.” New England Proverb
     “Money is a stupid measure of achievement, but unfortunately it is the only universal measure we have.” – Charles Steinmetz

156. 152 . Chapi – Good analysis ha ha ha !!!!!!!!!!!!!!!

157. Congratulations!!! Lusaka times, well done u have managed to erased ci arabic calembele embulwa mano. Pls try also to make it impossible for imposters to be accepted on blog, if possible u give each individual blogers a secret code numbers for one to use whenever blogging.

158. Chapi, LPM’s plot on “university land” is a real thorn in your side ?? Give us some more background for us to appreciate the venom contained in your all too frequent quips about it !!

159. Chapi#152 Very good. We are not going to be fooled by economic indicators.We have to see real POSITIVE impact on the common Zambian.For how long have we been hearing about the inflation getting down and the Kwacha getting stronger? One,two,three years..?

160. Shakers and Movers,
     Very cognizant of the fact that my brief remark to the LT subject line on BOZ Governor Fundanga’s economic outlook report has invoked an expansive economic debate. That is healthy for our Country searching for some growth stability mechanics. Certainly, as individuals and institutions we have a lot to debates on considering that man is ever in some learning curve pursuing some continuous improvements.
     In this vein, it would be counter-productive to shoot down any contribution painstakingly made here. Now am merely adding my views to the long thread of varying economic views. Depending on what school of economic thought we individually come from, disagreements and rivalry in economic analysis will always be predominant.
     The released BOZ economic outlook report could indeed be looked from many angles. I treasure Chapi (4)’s directed at me to justify the benefit of single digit inflation verses the high unemployment and poverty levels in our nation. First, I applaud our Technocrats and politicians for their strict fiscal discipline policy in the overall economic management. I believe lower inflationary brackets are cardinal for economic stability and eventual growth which lead to capacity for jobs.
     Nothing wrong, we could look at numerous existing economic theories and models such as the Keynesian, Phillips Curve or some stochastic forward-looking model with a lower bound, calibrated to our troubled Zambian Kwacha as solutions. But the solution still lies in us to continue brainstorming and coming up with our Zambian centric models that fit the time being cognizant of the predicament we are in from unemployment to economic growth rate macroeconomic variables instability.
     We are now an open-economy with substantial differences from the closed-economy framework we existed where the economy survived on cosmetic means. Our investment starving economy needs some arrested inflationary trends if we have to increase some long term economic performance and growth stability. Knowing our exchange rate and open economy, it would be helpful to understand the Phillips Curve I have seen many have rightly sighted in their contributions here.

     It is helpful know though that; the Philips Curve impairs the perfect stabilizing property of monetary policy in the face of demand-side disturbances under domestic inflation targeting. If CPI inflation is instead the target, the perfect stabilizing property of monetary policy breaks down even in the absence of the direct exchange rate channel in the Phillips Curve. Thus in any approach we should carefully compare the behavior of the endogenous variables of the model and the policy instrument under flexible domestic inflation as opposed to flexible CPI inflation targeting if such models have to be appreciated.

     Next….Continuing with is there a correlation between unemployment and lower inflation?

161. Chapi’s criteria for a good FM is laughable really. It lacks recognition of the reality and touches areas which are unrelated to the job in question.
     Economic indicators importance can not be over emphasised, they are the only measurable way to know how the economy is performing. The trouble with waiting to get ‘favourable views form the common Zambian’, as Mr Zed suggests is that this is NOT measurable. Hearsay will not take you anywhere…

162. Pragmatist(161),who are your target audience given the complexity of your submissions?It is quite apparent that you have above average skills in the English language and there is some evidence of competency in the field of economics.Simplicity and skills in making summary statements are a requirement on “general blogs” such as Lusaka Times.A deluge of complex theories are matter of specialist digestion and not required for simple minded and practical participants you often find on blogs like this.Specialist fora do exist and you obviously qualify for admission.I trust you will reserve your energies for such fora and leave the space for more generalised contributions understandable by the majority.

163. #161 Pragmatist, You have woke up well today and your contribution seem to be viable and acceptable. Unfortunately your analysis is incomplete because the Philips curve alone is not enough as indicator. Keynes is just one economist but the are other like Milton Friedman and all those who were adcocates of the laissez-faire capitalism. This means “let it be” or let us do it mark the birthday of free market economics which are live in today. Its only thru comparison that we can be able to make right decisions.

164. #163 TOP what is wrong with pragmatists contribution on 161 he just made a summary of what we have been discuss and noble human can understand this. You have to be an expert of your own instead of waiting someone to explan things to you. Ask Kuku he will tell you the same. I have also noticed your contributions are missing on this topic. What have to to say about the law of supply and demand in relation to Inflation. We need ideas how we cab our economy and stop it fron declining.

165. Can Zambia attain one digital inflation. Read on and comment.I believe this is Zambias problem Mercantilism was a theory that took special notice of the balance in payments and sought simply to monopolize gold, in part to keep it out of the hands of potential military opponents (a large “war chest” being a prerequisite to start a war, whereupon much trade would be embargoed)
     As mercantilism gave way to classical economics, these crude systems were later regulated in the 19th century by the gold standard which linked central banks by a convention to redeem “hard currency” in gold. After World War II this system was replaced by the Bretton Woods institutions (the International Monetary Fund and Bank for International Settlements) which pegged currency of participating nations to the US dollar, which was redeemable nominally in gold. Yet long time ago Adam Smith talked of the Diamond-Water Paradox.What is important Diamond or Water. I need food rich in vitamins to keep me healthy.

166. EASY could you explain to us the relationship between inflation and balance of payment?

167. Hey#162.I didnt say we need to get views from common Zambians. I meant the BENEFITS common Zambians get from your DIGITS on inflation!Get real.People are hungry they need money into there pockets not lectures about ECONOMICS.

168. Hey guys, prices in Zambia are not rising as much as before. Many commodities cost about same as they did a year or so ago. This is not to say prices are low. But at least they are stable. So the incomes of ordinary people have to increase in order to appreciate stable prices.

     SAGE, i notice Easy is cooking up a conceptual sausage by mixing up alot of stuff. My take on BOP is this. BOP is our national balance sheet. Lets say our dollar reserves are falling because of low exports or higher imports, this often leads to massive depreciation of the currency. When the currency depreciates you need alot of kwacha to buy imports which forces Govt to print money and thereby fuel inflation. Which then kills the local economy and gives you more inflation, etc. The other way is Govt fixes the exchange rate, but this is unsustainable because it causes a shortage of dollars and a black foreign market. This is what Gabriel Mugabe is doing over in Zim.

169. Francis…! from a layman’s perspective ….a booming economy has be felt by everybody! if yours is improving by the BOZ’s rate, then good for you my brother. for a common man like my self numbers keep on changing and yet my standard of living has not impoved an inch? cooper exports were good, but whose economy has improved…the investors? to my understanding a good economy “nimu mpoto and having a job?”

170. Mr Zed # 168! you absolutely right! i hope francis has a way of adding up the numbers so that people can have enough food. brother Francis practice what you teach? do the math!

171. #167 SAGE how did you define inflation and why is it important to keep low? You described BOP isnt it? So start by looking the budget of Zambia every year and look at the Expenditure and Income Accounts compare the two and then tell me the result. The problems lies of Balance of Payment which is being compensated thru Aid, Loans, grants, this the govt have to serves and they are eating our investments all the monies we get in selling of precious stones goes to servicing these debts only about 7% can be retained. Do you what it means for an economy to live on a debt the standard of living remains poor. If Zambian coffers where full the leadership can invest more in improving condition of service.What is wrong with us Africans look at the toilets you find in Shanty compounds like Kanyama no wonder cholera breaks out every year. In south Africa the govt promised every one 13 years ago to build decent house up to now nothing has happened yet you produce tonnes and tonnes of Gold, wine, …

172. diamonds, cereals and many more. Where is the problem simply debts we have are a burden its clear how Africa compensates the west with what they need. Even at G8 summit it was admited hence the focus on Africa.

173. #170 You are not in Zambia early this year prices of meal meal increased it tool the president to intervene. Fuel has never been stable.Cement is selling higher on the black market because some ***** Manager is exporting the commodities. An economy cannot work unless you satify your domestic market. The ratio should 70% local market consumpation and only 30% should be imports. Is the case in Zambia. USA can afford to have a deficit on BOP because they consume all what they produce hence a sound economy. So you see how you can put inflation down. Its only bringing the it down but to maintain it. Stability baice bandi

174. #169 Francis, your dollar has less value than our cobalt and copper you understand. Money is just a symbol and a medium of exchange. The Kwacha can as well be strong like the Dollar. Please do basic economices to understand how things work. You lack expertise. Why the G8 want to maintain their lending status? What is at steck? Why are they worried about China becoming a economical jaunt? Open your eyes the problems is you are living in the USA where you have opportunities.

175. Sage and Francis dollar reserves are meaningless if pipo are hungry, no jobs, health facilities. You have always complained of taking patients abroad like morningside clinic what is the reason of doing this?

176. Easy this isnt the place for such silly talk. Its not my fault that you’re failing to communicate well with many people here. Again, USA has a trade deficit, not BOP deficit. There’s no such thing under the sun as BOP deficit!

177. I have differed with many people’s opinions many times on this blog but i still consider them reasonable and thoughtful people. But i think you’re taking this to a different level. Not all of us are living in the USA.

178. #178 Francis, I didnt mean to be personal sorry if you are not in USA. I forgot that you UK. We should not fight but bring arguments. Now here is the Current Account of USA as per 2006, US$862,300 Millions. Wat have got to say about this because it coming from BOP. Pilz dont confuse the two Trade Balance is part og current account.The balance of trade forms part of the current account, which also includes other transactions such as income from the international investment position as well as international aid. Mind you USA doesnt need Aid. Modern economists are split on the economic impact of the trade deficit with some viewing it as a loss in a fixed volume of trade and more radical Neoliberal voices who claim it is a sign of economic strength. The traditional view opposes long run trade deficits and outsourcing for the sake of labor arbitrage to obtain cheap labor as an example of absolute advantage which does not produce mutual gain, and not an example of comparative advantage.

179. Imwe Baice bonse apa pa blog including pragmatist you are failing to understand simple things,if you cant rely on data from BOZ where else will you get it?It doesnot make sense to argue from without.See my quotes from Kabwe on China and how learned men have approached the economic measure of china to ascertain reasonableness and that is what you should do if in doubt.Dont just argue like you are all pensioners.Iam a Mathematician by profession but I understand economics better than those who did it as their major, why?,reason is simple ,develop interest and apply your analytical skills to articulate things in more bigger perspective.I urge all of you to encourage your children to love Mathematics and not shy away from it it helps.
     If this is the calibre of future leaders ,ninshi nimwaculeni

180. US$ -862,300 Millions

181. #179 to who are appealing? Is it SAGE or Francis? It seems they dont want t understand your mathes. I love calculations mudala. I have keen interest that is why in I took it as part of my studies to understand figures, analyse things from the mathemical point of view. Iam surprised by SAGE and Francis who thought they understand their Base two binaryin their computers studies but they are without any logical in it. Its disappointing Kuku we need to teach this young men more of algebra. From your point of veiw yu are right I was motivated by pathgorous theorem. Kuku if you tell SAGE that synergy effect 1+1=3 we will not agreed.

182. Kuku Mudala naiwe where is the data I requested from CSZ on VIOP? I need it to complete my concept.

183. Easy, it seems you having a thing about me or SAGE. I cant understand why you constantly fanning direct confrontation. I have done Maths at UNZA before i migrated to economics at masters(USF) and post-graduate, and a postdoc at harvard (CID). I cant imagine from the quality of your debate you are anywhere near this in economics. There’s no mathematics or economic theory i could learn from you or kuku if as you imply he might have been referring to me. I earn my living lookig at economic and social data on Africa everyday. I do apologise for boring others but i thought you should know this and stop demeaning your friends. Thought this is just a forum for airing views.

184. I didnt want to heat back so I understand why Africa is painted black everytime.We have guys like you who have lost sight. You gave gave lord cains that false inform about zambia.Why do take this personal.I am delighted with career radar I am emulating you.you know the sky is the limit until death part us. Francis is not you who admited on one of your posting that you are not an eonomist.i also read article on ukzambian over fibre and wireless. check 142 then 168 pilz govt coffers are empty wat are talking about.bop in zambia is still being supplemented debt,aid, grants and help.what is this to you.

185. I believe you do know (#127) that SAGE shares my name Francis, but we are 2 different individuals. In #168 am just arguing with SAGE. SAGE seems to be in IT and iam an economist. But thats not the point you insulted both(#181) with your A-level economics. And then you ask me why am taking this personal? Case closed.

186. Francis iam postgraduate and iam also an economist but i combine without subjects.dontlet me done stand the test of time remain strong.accept critic thats makes a good leader. i hve not seen insults here.

187. #185.Francis.Just ignore this guy EASY,he doesn`t mean it when he comes out confrontational.He`s a guy that means well for the nation but just like me we struggle with zaenglish.Otherwise,continue with your accurate analysis of our economy coz we need your rich input on this blog.

188. chapi thank you u a my survivor.

189. Lets differentiate economic improvement from improving personal fortune. In a strong economy,take the US, there are still people that live in poverty, people have credits and some have to file for bankruptcy. This however does not mean the US economy is weak.
     So the only way to understand changes in the economy is through the same figures that some are ignorantly shooting down.
     lets continue looking out for the inflation figures, GDP growth etc. I am afraid there are not 2 ways….

190. To finalise this topic can our economist Francis tell us how the Pin Book Balance of Payments for Zambia look like and stands. I know you have the data give it out the mass they want to know where council workers go without pay for 5 months. In addition Francis you are the right be person to give hints on how much percentage of the Zambian GDP on the Balance of payment. Pilz clarify also whether the Zambian economy is in a boom or doom, regression. Chapi I conquer with you we need Francis analytic know-how. So Franz not give up this is a challenge to you. Magande will need you one day. Also we need data on Cost-of-living adjustment (COLA) whether its applicable to the Zambian economic situation. I will never I want to a theoritic but practice matters most iam glad to have pipo like Francis, SAGE, Chapi who know there stuff very well. Kuku how did the meeting end in Kabwe. Next time give notice in advance so that I can particiate.

191. Francis(185), it is heartening to note that i’m not alone in realising the shallow application of various theories by some fellow contributors.It is normally the “usual suspects” who “propound” complex theories in the hope of impressing others!! Simplicity and summary skills are a mark of a true genius!!I advised specialist blogs for our comrades (refer to 162), but alas few if any have taken heed !!

192. A Public forum can be an audience of people I would call assemblies of different backgrounds and capabilities. It’s not a fora of absolute uniformity that the challenged only exist. Anything posted herein is not for every body to absolutely synthesize but one or two that are better vested to do so. In the same vein, no right minded person worth his maturity, character, or clarity of mind would think debaters post with intent of making some impression. Impression to an online community the poster only debates with only? Such self demeaning thinking is a sign of some acrimonious insanity right there. It calls for sympathy than disputation beyond these remarks. There are many commercial platforms that call for impressive contribution in commensurate with some extravagant intrinsic value the offer and not voluntary driven blogging sites.

193. A Public forum can be an audience of people I would call assemblies of different backgrounds and capabilities. It’s not a fora of absolute uniformity that the challenged only exist. Anything posted herein is not for every body to absolutely synthesize but one or two that are better vested to do so. In the same vein, no right minded person worth his maturity, character, or clarity of mind would think debaters post with intent of making some impression. Impression to an online community the poster interacts with in debates only? Such self demeaning thinking is a sign of some acrimonious insanity right there. It calls for sympathy than disputation beyond these remarks. There are many commercial platforms that call for impressive contribution in commensurate with some extravagant intrinsic value they offer and not some voluntary driven blogging sites as LT. As free minded Debaters we are here just to support our brother’s initiative by adding a sense of diversity in views. So baba you have some work to with your stunning mental gaps.

194. Simplicity and summary skills are a mark of a true genius!!

195. #191 The original Pundit, what is wrong with you here we debate so that jim and jack and understand the whole of inflation, there you go and start talking nonsense who is trying to impress who? I have not seen a single contribution to inflation topic yet you term those who try their best to explain the situation. Say something you about inflation instead of just seconding Francis like ku debate club ya ku sikulu.I need ideas here and critic is part of the game and who can not take he should put his efforts somewhere else. So what are perspectives to the topic please with factors so that your arguements can make say. Francis I asked about your knowledge about the pin Book please answer this question before I get disappointed.

196. #194 TOP I have talked of supply and demand, elacisty, inorder for bloger understand inflation without looking at these measures we can not go where. At least there must these forms to talk about Inflation. Since Zambia is not an Island we have to discuss about BOP because its avery important indicator of our economy. If we were not borrowing then GDP would be enough.

197. Easy(196),the basic definition of inflation is too much money chasing too few goods.Following on from this basic definition, our national production(value of GDP)has steadily increased and a simplistic inference is that inflation should and has gone down.Reducing money in circulation may also(simplisticly)reduce inflationary pressures.An option is to increase yield rates offered on long term deposits..in Zambia possibly on Treasury Bills.Caution must be exercised here, as businesses will prefer to invest in TB’s and not in prodn..less risk!This affects GDP growth and negates earlier efforts at reducing inflation.A balance is therefore required to be enforced by BOZ.Huge wage demands/increases will increase inflationary pressure, a problem we have with MUZ hence Govt. suggesting modest increases only.You see Easy,….alot of us understand these things but detailed discussion is not for this type of fora.Silence is not always a sign of ignorance but of disinterest at times!!

198. Easy,The balance of payments,(or BOP) measures the payments that flow between any individual country and all other countries. It is used to summarize all international economic transactions for that country during a specific time period, usually a year. The BOP is determined by the country’s exports and imports of goods, services, and financial capital, as well as financial transfers. It reflects all payments and liabilities to foreigners (debits) and all payments and obligations received from foreigners (credits). Balance of payments is one of the major indicators of a country’s status in international trade.Very easy info to find on the net my friend!In simple terms we have to produce more to earn more,keeping the money in Zambia.We need to encourage import substitution to reduce outflows(KK tried with Tip Top and Kwench)Capital flight has to be controlled, hence our mines should not be wholly owned by foreigners etc etc.Easy, continue we learn.Be simple,cut out complex theory!!

199. #197 TOP good you have brought the defination my teacher taught me in civics. This good why keep quite when you something look at how the discussion has gone. The story would have been cut short. How every on one point I will disagree with you. The problem of MUZ and GRZ is not inflation but the adaquate amount of money for the labor done to meet the demand and the cost of living. Its very unfair to exploit the masses in the name of profit making. If a Mine Investor pays $100 per month in termines of wages yet he is making Billions. The relation is very bad hence people protesting. I have also notice you yourself you have mentioned improvement of condition of service. Poverty is not good especially if you know that your efforts are compensating the other part of th world. This is unfair. You and me went to school at a time when you could get pencils, books etc free but today the situaton is different. Ba TOP dont keep quite you know something voice out. Remember God for us all but….

200. #198 TOP this is not enough we produce more and we have produced even more look at the european countries with their electro trains they have benefit from our copper yet us we profiting nothing apart from debt servicing. Your contribution is ok but you are not mention where the problem is. BOP can not be ignored as an indicator because it plays very important in our national Account. The national account has a deficit because of this and the IMF SDRs. You must know this. Now we should look at the solutions how we can tacle this problem. We should be part of the solution not only part of the problems. Also things retarding development in poor countries should be look at and attended to fully.

201. Easy(199),you have mentioned our efforts being enjoyed elsewhere..capital flight!Receipts from copper/cobalt sales are received abroad.these chaps only bring back enuff for wages and to pay local suppliers.the rest they keep outside.if ownership included zambian institutions(NAPSA,Pensions,LASF etc)we could control this.this is why our largest exporter cannot be wholly owned by foreigners!!let us legislate that 70% of export receipts be kept in zambia in FOREX so as not to increase inflation or strengthen the kwacha too much and make our non-traditional exports(nte’s) less competitive internationally.

202. He who seeks advise from outside can get even a razerbread which very shape. I can remember during the SAP some stupid westerner advised FTJ to say only 30% of the national wealth can be allowed to owned by Zambian because the gap between the rich and the poor is very big. So if 70 percent of the companies was to be own by Zambians then this gap will even grow much bigger. This was a blue lie that is why I dont like Mungomba since he was chairman of SAP and Board member of ZCCM at the same time. Those guys they have benefited actually if anything they must be tried too so mispropriotion of our wealth. I have never seen a country like Zambia which let everything to foreigners that like that even in the name of money and poverty this is too much. Look at the Indians the way they used to live along Burma Road. All the shops at kamwala belonged to them.

203. Easy(202), I am suggesting 70% of export receipts be kept in Zambia not 70% ownership….two very different things mon ami !!Your underlying sentiment that we should have strategic ownership participation in major industry in Zambia is well understood.To undo what ZPA/FTJ and co. did is indeed a mammoth task!!

204. #203 Ok understand but I have one more question. What are the consquences of too much monies chancing few good? Can you elaborate for the layman on the street to understand. Pilz give also examples of actual situation so that when people demand for salary increament they should know the out. You know in developed nations sometimes inflation is wished because it becomes a motor of a economy. Imagine everyone having money and can afford a car and he is paying fuel tax, road tax, insurance, for council false parking penalties, driving whilst drunk (legal) at the end of the day GRZ have effort monies to repair roads, pay council workers, You they say laws are made to be broken to see their effectiveness. Hahaha just talk about the disadvantages of Inflation. Your 70% cannot yet be kept in the country because of what the Germans call economy freser (Debt). This is the experiences they had during the Weimar republic. Maybe we can learn something from this.

205. EASY.. Young man learn to type your comments in word and the paste them in the blog.It helps with sentence construction. May be we can lessen the arguments if we start writting in the same language.

206. #205 SAGE IT Specialist dont forget this is partly Zangalish or new Bemlish. Do you understand what I write or you dont want to understood huu. SAGE you missed out after knock-out what they go to say how can we reach the 70% TOP in(203)is talking about. Your friend Francis is annoyed of me because of Algebra when I was just joking with you guys. Takwaba to laugh pa Blog.

207. Easy(204),the moment shop/home owners find out 30,000 miners have been given K3m across the board the prices will go up.Soon the extra 3m will not buy an extra K3m worth of goods or services…back to square one BUT you would have increased money supply, weakened your currency and increased the cost of imported goods becoz you’ll need more kwacha for a US$(majority in zambia)again pressure to increase wages and the circus continues.you would have introduced additional money(increased money supply) into the economy without a corresponding increase in goods available(either locally manufactured or imported)….too much money chasing too few goods!!Hello INFLATION!!It is a simplistic description but sufficient to paint a gloomy picture.

208. You know what easy. I like you atitude, you dont take things personal. keep it up. I left earlier yesturday i’m trying to finish up an article on VoIP. But i will be back monday. have a good weekend.

209. Sage(208),i actually have a weak spot for the guy!!keep well…we kill each other Monday

210. AGRICULTURE SECTOR RECORDS 3.9 P.C. GROWTH

     THE agriculture sector has over the years grown by 3.9 per cent and has been generating between 18 to 20 per cent of the national Gross Domestic Product (GDP), President Mwanawasa has said. Mr Mwanawasa said the growth could be attributed to the favourable macro-economic environment, favourable weather conditions, the timely availability of agricultural inputs, coupled with overall good agricultural policies. Speaking during the official opening of the 81st Zambia Agriculture and Commercial Show, which was opened by his Botswana counterpart, Festus Mogae in Lusaka yesterday, Mr Mwanawasa said his Government recognised the vast potential in agriculture and avenues available for tapping into this potential in order to achieve wealth creation, food security and reduce poverty.He said Government was committed to making agriculture the engine of economic growth in Zambia and that this had been demonstrated by the 8.5 per cent support to the sector in the national Budget this year compared to last year’s five per cent.During the 2006/2007 agricultural season, Zambia produced enough food which, when added to the carry-over stocks from the previous season, adequately catered for the national consumption, as well as leaving a surplus maize stock for export markets.He said Zambia had recorded a maize surplus of 250,000 tonnes in contrast to last year’s maize surplus of 160,000 tonnes.The President said the drive for economic empowerment was supported by the sound economic policies which his Government had been implementing since 2002.He hoped the show would contribute to regional economic integration, especially that the number of foreign exhibitors had increased.Show Society president, William Saunders said although the agriculture sector now accounted for less than five per cent of the total exports, it was an important source of employment in the country.President Mwanawasa, Mr Mogae and other guests were treated to dances from different dance groups at a colourful ceremony at the Showgrounds yesterday.Meanwhile, President Mwanawasa says he is not happy with the slow pace at which the Food Reserve Agency (FRA) is purchasing maize, and has directed the Agency to double its efforts.Mr Mwanawasa said he was not happy with the purchase of maize, saying there was a lot of maize with farmers which must be bought.

211. PERSONAL TO THE LT ADMIN STAFF

     For not heeding to the counsel of the wise and the experienced, you have indeed killed this medium of open discussions. It had the potential and value, but your passive leadership has evidently initiated some fierce acts leaving the privacy of debaters compromised. Impersonations, insults on debater, public officials and such illegal acts void of tolerance have been increasing condoned in your eyes. Now it’s no secret that the LT server data base has been compromised beyond exception. The million dollar question is; why Zambian blogs don’t serve the purpose long enough with decency, tolerance and responsibility? Think Tank and Zambia Online forums died the same way LT is sinking right in the face of all the free advice you have received. Shame to us all for the inaction!

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213. i think you are rght FACT.Check phones for grabs at zamdeals.tripod.com

214. While i do not wish to disagree with the fact that IMF plays around with emerging economies, i think we should learn to say “Well done Fundanga and team!” 😎 for the will and effort to fight the manipulation of our economy by IMF and World bank

215. Fellow zedians, please be honest here. is it wealth for one to return to Zambia????

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