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 One thing is clear; interest rates, particularly as they apply to the finance of private housing will have to rise, at least to 8%, and probably initially to 9.5%, and then perhaps reduce to 8.25% including the bank's margin of .25%.

One thing is clear; interest rates will have to rise to 8.25%.

 How is this? It assumes a law of supply and demand in the economy where everythig, including money is available to the highest bidder. It means that you do not actually have to need what you are bidding on, but that you do have the money to pay for it. For example, a businessman may be prepared to pay a higher price than is justified if he is bidding for the only other lawnmower repair shop in town if he knows that by buying it, he will not only control its assets, but also offer the only lawnmower repair business for a large captive market for his services, because of convenience and geographic location, and knowing the cost of setting up a new competitor would not be justified by the returns. He would then be free to raise his prices to pay for the purchase.

In other words, in the supply of money as in any other service, the laws of supply and demand exist. If the market price for a loan is controlled by a private bank which charges 10% on loans of 2, 3 or 5 years and it knows that nobody else has the money to supply the market, it also knows that it can gain business (contracts) by undercutting the opposition to the point where their business becomes unprofitable. In reality there should be no risk in lending money because every loan should be balanced against an asset with a market value. In a high inflation economy, a short term loss on teh books when an asset is taken at a market value below the value of the loan, can be turned into a profit after the market price rises, but this may take two or more years. The person taking out the loan may not have the option of waiting that long because of immediate cash outlays and no equity to justify additional borrowing.

 Education

The Minister of Education

State Housing 

The Minister of State Housing

 

Health 

 The Minister of Health

The Minister of Finance

 

 

 

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