Up until Wednesday, South Africa's status of a banana republic was unconfirmed. Then on Wednesday night, the president fired the finance minister. Not because he was doing a bad job, but because he was doing his job well. Unfortunately this interfered with the president's girlfriend being able to pilfer money from the state airline, SAA, as well as his massive kickbacks from a monumentally huge deal with Russia for a few nuclear power stations. He's been replaced by someone who is very unknown, except that he once ran a municipality so badly, that his house was burnt down by the community. He's a yes man who will open the tax payers wallet, and hand out cash freely to whomever our president (who's top level of education is grade 4, I kid you not) chooses.
We've all been watching this buffoon for the last while, and the currency has gone from R6.50 to the dollar to R14 to the dollar. Yesterday it went from around R14 to R15.50. The financial sector on the local exchange lost 13% in one day, a bigger one day drop than any day in the 2008 banking crises.
The net effect for me was that I started the year with $500k, during the year I've put away another $60k. The US market has risen by a good amount, so if I was invested there I'd be worth about $600k today. What am I worth now? Well if I had to move my money into dollars today, I'd have just short of $400k. In effect our useless government, led by a painful dictator want to be has managed to remove $200 from my potential net worth.
I also don't really know where to go next. It's hard for us to move more than the current equivalent of $60k a year out of the country. And even if I could, it'll be so hard swallowing the terrible exchange rate, but I also don't want to keep going backwards investment wise.
Any ideas?