Warning: this is a rant from an individual who feels hard-done by.
A month ago, in November 2001, the South African Rand was trading around twelve to the British pound, and was considered by many to be undervalued. It is now in late December over 18 to the pound, and still falling (update: this exchange rate touched 20:1 on Friday 21 December). The decline relative to the dollar and Euro has been similar.
Along the way new records have been set: The fastest falling currency, the cheapest place in the world, the only place where a Big Mac costs under $1. Yes folks, the markets, in their wisdom, have decided that the SA Rand is worse bet than the Afghan currency right now, what ever it is.
Phrases like 'I would not like to be drawn on any prediction for the next 24 hours', 'we will take action once we work out what is going on', 'not an economic matter in the normal sense', 'unjustified by South Africa's solid economic fundamentals' and 'speculative attack' are bandied about in the press.
I would be hesitant to accuse the South African government of any untoward degree of competence or even concerted rational reaction, but let us put this in terms of what it seems to be:
This is not a rational valuation of the currency. This is not the market finding a stable level. This is not even about a bit of market sentiment. This is economy-wrecking for the sake of making a quick buck. If this is what free markets do, then maybe free markets are not all that they are cracked up to be.
See the Tobin Tax writeup for mention of other counties that have been fucked over by currency speculators. This is not "the markets" deciding en mass. This is a few very rich men getting even richer by manipulating values, by precipitating economic and political crisis. By devaluing the life savings of the poorest people on the planet. Not to balance the market, but just for cash through chaos. That's not a 'market clearing', that's theft.
Currency speculators who do this should be tried for crime against humanity. The economic harm done will result in less imported medicines, less nevirapine and other expensive medication that must be licenced or imported from the first world, fewer clean needles, fewer combine-harvesters. And inevitably from that, more than a handful of deaths. The death penalty is a legitimate option in cases like this.