Global Revolution Spreads

These revolutions and protests are going global, and the rate at which it spreads will be perfectly correlated with the rate of depreciation of currencies in a domino fashion, i.e. dominoes of bankrupt governments falling.

As we said before regarding South Africa, Tunisia, and Egypt:

“Politicians must be careful what they wish for.  Weakening the Rand to help exporters in the short-term will bring severe hardship to the vast majority of South Africans as their transport and food bills skyrocket.  If the Rand weakens 30%, expect the petrol price to catch up and be roughly 30% than it is today. The Rand is a numeraire, by weakening the Rand everything priced in Rand automatically rises.

In an environment of higher unemployment, a weaker Rand will result in violent outbreaks and public unrest nationwide as people on no, low or fixed incomes see their disposable income completely wiped out.  And as Gerald Celente likes to point out, “when people have nothing left to lose, they lose it.”  It is no coincidence that the Xenophobic outbreaks happened in May 2008 when CPI inflation was breaking above the 10% mark.”