Amid increased anxiety over Ramaphosa's white farmer land confiscation and reports of a $4.2 billion bailout of state-owned enterprises, the Emerging Market rout in Turkey has sparked a collapse in the Rand in early Asia trading.

The Rand crashed 10% against the dollar almost instantaneously as Asian FX markets opened...

Looks like Ramaphosa top-ticked it...

As Simon Black warned back in March, when Ramaphosa to push for the constitutional change required to confiscate white farmers' lands, this would guarantee a banking crisis for the country. Here's why - a lot of this land that the government wants to confiscate probably has quite a bit of bank debt.

Imagine – you just bought a farm for, say, 50 million rand (that’s about USD $3 million). And in order to do so, you took out a hefty loan from a South African bank.

Now the government comes along and steals your property.

Are you seriously going to keep paying the loan?

Of course not.

This means that the banks are going to be stuck with massive defaults and bad debts, leading to a wave of bank failures.

So in their crusade to bring Social Justice to South Africa, the government is effectively engineering a banking crisis in their country.

This is criminally stupid behavior that puts South Africa on the same path that Zimbabwe followed in the late 1990s.

And now, as Bloomberg reports, South Africa is planning a 59 billion-rand ($4.2 billion) bailout for state-owned companies including the post office, arms manufacturer Denel SOC Ltd. and South African Airways, the Johannesburg-based Sunday Times reported, citing unidentified government officials.

The contagion from Turkey's collapse is not helping as broad-based EM liquidations are dragging everything lower...

As the Emerging Market FX rout continues...

 

And offshore Yuan is sliding...

We look forward to the Brazilian Real opening...