Thread by @MlamboProf

1. One of my friends posted this #MidTermBudget2019 Analysis on Facebook. I agree with the majority of his analysis and therefore I will post here as a thread :

@mutungadzimwe @XixuXaxa @mtakagogoe

https://twitter.com/XixuXaxa/status/1157586202243076096

2. A quick breakdown of why this budget stinks. It’s the numbers. First half, revenue $4.99 billion, & expenditure $4.2 billion, giving a surplus of some $0.8 million. Second half projection, revenue $9.11 billion and expenditure $14.42 billion giving a deficit of $5.31 billion.

3. Two things wrong with that: a) Mr Surplus plans to become Mr Deficit in the 2nd half. Why? The scary thing - he projects expenditure 2 b up 243%, when we know that at best in real terms GDP growth is going 2 b flat, at best +2%. Revenue will be up 82.6%

4. To put it simply, a 243% increase in nominal value of expenditure given a real growth rate of 2% simply means one thing: the monetary base is going to be inflated 243%.

5. In other words, there is going to be printing. In reality, though, printing was already there, and that is why we have been experiencing the inflation – now turned hyper-inflation – that we have been going through.

@MthuliNcube, through his #MidTermBudget2019, has clearly declared his appetite for the printing press!

His figures shows that he putting it out there in the open that he is going to print, and print at scale.

@steve_hanke @bmusonza @NewZimbabweCom @nelsonchamisa @ProfJNMoyo

6. So the immediate thing you know is TSP is out the window, hyperinflation is here to stay, and the rate will at best be 1:30 at year-end, but more likely around the 1:50 level.
@Busisa74 @bmusonza @MthuliNcube @RMajongwe @zanupf_patriots @ShingiMunyeza @zenzele

7. As for the civil servants whose pocket is going from $4 billion to $5.6 billion (40% increase) all I can say is: “Mwari ngaave nemi!”

(Remember, this is not my analysis, I copied from my Facebook friend).

@ZctuZimbabwe @RMajongwe @bmusonza @LynneStactia @MkweshaFaith