Topic: Rampant inflation, yet a steady exchange rate. (Read 469 times)

We need to get more specific. I'm assuming you're talking about developing or emerging markets?

In North America, what you're saying has been true for the last ~20 years. Wages have stagnated and diverged from GDP growth since 2000 or so. That certainly was not true in the preceding generations going back to the 1920s or whatever, which is what I was referring to.


I don't think so. It's an attempt to prevent depressions and curb recessions. Fed policy may be misguided and may end up imploding the economy one day but I don't buy into those kinds of conspiracy theories. It's pretty well known if you have savings, you shouldn't keep it in cash. That's the whole point of retirement accounts; they get invested into the market.

Eh, as recent as 2 years ago you could get a few loafs of bread like 20 SDG, today it's like 8 times as that. I don't have a grandfather around, but salaries were pretty normal pre-2018 protests, my dad's job was making like $3200 a month in SDG in 2014.

I like the idea of more markets to import goods from, because it makes foreign suppliers compete with each other to sell at the lowest price. And despite sanctions there's still a swarm of far-east suppliers for Sudan in China and Hong Kong.

According to this chart, the exchange rate was quite normal a few years ago, except for an oddity at the end of 2016 for which I have no explanation (could be a political event?)




So apparently stores are stopping selling their stuff because of the price hike overnight. I hope this exchange rate hike is only temporary, because stores take a few days to adapt to the new prices and if this persists, things here will become even more expensive.

I still experience floods like that once in a blue moon, because here, when it rains it pours. I've personally seen whole streets and walkways flooded with muddy water, and nobody is there to dry it up. The floods aren't as bad where I live, I heard it's worse in some areas of the city.

I also heard they are getting an ambassador to the US. I hope he can manage to convince them to remove them from the state sponsors of terrorism list because if they do, all the trade barriers between US companies and Sudan will be overcome, and the country will be in better shape with fresh new trade.

It is unsustainable just like everyone said, when a country continues to have high inflation, dollar will eventually become a lot more valuable, it is just about how many people in there who have dollars or who can afford to buy dollars. Let me give an example from bitcoin world and we can understand a lot better.

Let's say you live in a nation that is not using dollars, basically almost any other nation than USA, and you have your local exchange which deals with bitcoin to fiat and vice versa, and bitcoin price went up in dollars, became 15k, if there are not enough volume in that local exchange you use and someone sells a ton of bitcoins to drop the price, as long as there is nobody to keep buying for arbitrage reasons, they will not be capable of changing the price, so you would have a local exchange with 10k bitcoin price whereas everywhere else has 15k.

This is the usual problem of every country especially now that we are facing in pandemic. Most country resort to printing a lot of money however in return the value of money will depreciate and its buying capacity will be lesser. When it comes to exchange rate which you mean is steady and if we will going to analyze that exchange rate must also be in line with the inflation rate of that said country. This is one of the risk to consider when one is doing currency exchange. The choice to exchange to a different currency must be through indicative study for movement of currency value.

BUT it IS bad as people make out. In most regions of the world, the salaries of people doesn't keep up with the rising prices of goods and services. Why do you think more and more people go below the poverty line every year? The gap between rich and poor has been wider and wider.


Intentional to control the monetary supply to make plebs like us poor, and make us believe that it is OK. Haha.

Sudan has often been hit by crises. Early this year there was a food crisis in several important commodities such as the bread crisis, the fuel crisis and transportation. Besides that, the imbalance in the rate of economic growth that occurs in market import inflation.
the government has tried to anticipate it but the steps are still not right. The most important thing is that Sudan should not sell its country's assets so that it still has a chance to rise.

According to what was reported in some local newspapers^[1], the price of the dollar is about 260 Sudanese pounds, which means that the price lost about 42% of its value within 10 days, and speculation continues.
I do not think that what is happening is natural, and according to some news, the speculations that occur in the black market are caused by the fact that some buyers buy in large quantities, so I think that the government is buying dollars from the black market because there are many statements by the Prime Minister who says that the Central Bank does not contain reserves of cash The foreigner.

I think that one of the factors that prompted them to do so was the payment of millions of dollars in damages for the bombings of the United States embassies in Kenya and Tanzania in 1998^[2].


The country is also still on the list of terrorism, and finally the devastating flood of the Nile River with COVID-19 effect.

[1] https://www.sudanakhbar.com/816418
[2] Analyst: Sudan Has No Cash to Pay Damages for 1998 Embassy Bombings

I wonder what kind of salary he was getting paid back then. $3,500 a year?

Looking only at purchasing power perverts things a bit. In terms of wages (how far your paycheck goes) it's not nearly as bad as people make out. In fact, technology and globalization has significantly lowered the price of some goods even after we account for inflation.

The real issue is whether you hold your savings in fiat money, which is obviously a terrible idea. Inflation is a tax on savings.

That's actually intentional. Keynesians use inflation as a disincentive against hoarding money, which in turn facilitates economic growth because people have to find ways to spend and invest their money before it loses value.