Arbitrage profits/opportunities – the connected buying fuel with the bond and selling it @ $1 hard currency, and selling the hard currency on the parallel market in order for them to reorder more fuel. This has created instant/microwave multimillionaires without any corresponding value addition.
Initial outlay = US$1,000
Transaction 1 – exchange the $1000 @ $3.5 = RTGS 3,500.
Buy diesel at bond 1.34 you buy 2612 litres that is sold for $2612 real money.
Transaction 2, parallel exchange of $2612 @ 3.5 = RTGS 9403.
Buy fuel @ bond 1.34 to get 7017 litres that you push at $1 and collect $7017.
Transaction 3, exchange on the parallel market $7017 @ 3.5= RTGS 24,560 and buy fuel.
RTGS 24,560/1.34= 18328 litres
Transaction 4
$18328 x 3.5= RTGS 64,150
64,150/1.34= 47874 litres
Transaction 5
$47,874 x 3.5= RTGS167,558
RTGS 167,558/1.34 =125,043 litres
Transaction 6
$125,043 x 3.5= RTGS437651
RTGS 437651/1.34= 326,606 litres
Transaction 7
$326,606 x 3.5 = RTGS1,143,120
RTGS 1,143,120/1.34 =
853,075 litres.
Transaction 8
$853,075 x 3.5 =
RTGS 2,985,761
RTGS 2,985,761/1.34 = 2,228,180 litres
Transaction 9
$2,228,180 @ 3.5 =
RTGS7,798,631
7,798,621/1.34 =
5,819, 874 litres
Transaction 10
$5,819,874 @3.5 parallel rate = RTGS 20,369,560
20,369,560/1.34 =
15,201,164 litres
Transaction 11
$15,201,164
$15,201,[email protected] =
RTGS53,2040,736
Where have you seen such a casino economy? The elephant in the room is the bond. Our leaders must just take a bold decision otherwise we are building a bridge to nowhere. The madness at the Central bank will catch up with all of us very soon, and the consequences will be atomic. We can’t continue on this path. The market is distorted big time but will self correct is we do away with the bond.
Just imagine, from a mere USD$1,000.00 to over RTGS50 million on transaction number 11.
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