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Gold/Mining/Energy : Tenke Mining Corp (TNK) -- Ignore unavailable to you. Want to Upgrade?

To: Imran who wrote (168)	4/27/1998 2:45:00 PM
From: Gunnar	Read Replies (1) \| Respond to of 486

Imran! Thanks for your comments! It wasn't boring, but forced me to think about an interesting problem: Local causes of inflation. My basic point of view is the classical: War gives scarcity that gives high prices. The prices can be measured in a local currency or USD. If the local population don't have a currency at all it is of course a bigger problem, if we are talking about measuring inflation rate. At the very end of the Mubouto era he put some new money out in the Lubumbashi area, some weeks before the ADLF arrived. I suppose that created a local inflation not only because of the classical monetary way of explaining inflation as to much money in the market, but also because people did not trust the government as a stable one that could guarantee the value of the figures that were printed on the papers. Governmental spending can in many European countries push up rate of inflation, but gov is not the only actor in the market. But this is interesting, in the DRC the main part of the industry is working on the export market in the primary sector of the economy. Maybe you have a point when you emphas the gov expenditures as the main cause to inflation. I have to think more about that. Very interesting. Anyway I think that the problem we have today with people that work without salaries is a question about low incomes from the taxes, but I surely hope that the present gov can handle that situation. I am generally more optimistic about the situation and the development in the DRC than is the people around Marek at NCN. Regards, Gunnar (from Sweden)