Sometimes there is never any shortage of material to write about down here on the southern tip.
One could have another pop at PAP who really does seem to believe that even though less than a tenth of the member countries have paid their dues, somehow those of us who actually work for a living deserve to support them and pay their president’s rent. Or I could drone on about the National Gambling Board’s (which is not a big blackjack table in Pretoria) report that that industry’s annual revenue was R8.2bn, but gambling taxes and levies collected amounted to just R764m – which seems like nice work if you can get it.
And then one could surprise everyone and talk about the market and how it delivered 5.7% total return last month. This was thanks to a surging 9.5% from the financial sector which behaved quite coquettishly when it discovered that a foreign suitor was about to ask for ABSA’s hand. Firstly, of course, the eager groom must do the rounds asking permission of the presidency, the unions, the central bank and who knows which other “uncles”, all of whom will doubtless carefully explain the lobola system.
These forthcoming nuptials were cited as the main reason why the rand improved between 2 and 3% against most of the big currencies last month. Official inflation numbers also came out surprisingly low. Hence the “dead cert” bet in the markets for this month is that the Governor will pull the “Interest Rates Down” lever when the MPC meets for the tea and biscuits in a few weeks time. However, perhaps one or two attendees at that gathering will have spotted the following news item and might inject a note of caution into proceedings.
This news was that we South Africans are consuming every gadget and geegaw the world can’t sell elsewhere and this is resulting in a massive trade (im)balance number.
Confirmation of this shopping spree comes from the JSE’s general retailer index that was the best performing industrial index last month and holds a top five position in the third quarter. Lewis Stores will be listed in this sector on Monday and its R2.8bn market cap will be a very welcome addition. I think it will run hard. As, I hope, will Spar, a fortnight later.
Definitely running hard is a pack of US presidential candidates. Perhaps until a winner is declared, Wall Street will continue to ignore the signs that us bears are certain foreshadow a foul-up. One time-bomb that I believe is ticking is the delightfully named Fannie Mae organisation that is a very key player in the US residential mortgage market. The explosives include derivatives and interest rates and accounting rules and suddenly departing employees and so on. I have watched this one carefully for a while and think that the little red numbers are getting very close to zero.
Now for a Lions home semifinal.
James Greener
1st October 2004
(PAP = Pan-African Parliament)
