A week ago the All Share Index stalled within a hair’s breadth of the 18 000 level and I slipped away to the bush. And the moment that this bear turned his back, whoosh. 650-odd points down and plenty of muttering about program trades and other exotic hedging strategies that curiously seem to have produced more sellers than buyers. One particularly interesting deal was the personal purchase by Director Mittal of R461million worth of shares in the company that shares his name. Aside from the JSE apparently condoning a very belated SENS announcement of this giant trade, the turnover statistics also appear to have omitted this deal. Odd. I have long been wary of buying these shares as I don’t feel that the minority shareholders are always accorded the respect they expect.
A few pundits have also used the word odd to describe the action of the gold price which has been testing the waters north of $500 per ounce. In their view this is premature and well ahead of what they had decided was a proper schedule for such an excursion. “Sooner faster and further” is a home-grown aphorism that I have quoted before when an unexpected market move develops. Neither I nor anyone else knows where the gold price will go. It is of course even more difficult to factor in the currency and predict the price of a Krugerrand. The most recent peak four years ago at about R3700 is not far off from today’s R3450. I am intrigued by the thought that we may be witnessing a flight from certain paper currencies to something that at least feels like money. Remember the rumours of the emigrants in the bad old days shuffling on to the planes at Jan Smuts Airport with their clothing coming adrift at the seams with the weight of Krugerrands? That was before the metal detectors and the body searches. Don’t forget the NewGold exchange traded fund (just like Satrix) if you’d like some exposure without having to collect, haul and hide the actual metal discs.
It’s the time of year when the newspapers get plainer and slimmer while readers set out for the beach to get browner and fatter. Fortunately, the state and it’s vassals have stepped in to fill the advertising gap with generous gifts to the industry like a full-colour page to mark the 5th birthday of the new system of local government (gosh), a quarter page from Telkom to remind us that it has provided 10 years of affordable internet access for the nation (really?) and of course Joburg city’s ever amazing calls for tenders. This time for a “digital red-light and speed law enforcement system” (to stop kerb crawling in Oxford Road?) and for someone who can bind library books (The city does not employ librarians?). No word on who is actually going to do their job and ensure that the country just does the simple things properly. Like keeping its citizens and visitors safe and getting their own paperwork done efficiently and effectively. It’s a wonder that it has taken this long for a frustrated taxpayer to resort to threats of violence just to get noticed and served. If the black market can issue an ID book in hours for R200, should we not get them to do the job anyway?
There’s been plenty of very welcome rain in Joburg and the place is looking good. Perhaps we could offer the visiting travel agents a safer alternative to Cape Town – and there’s the (multi-) Million Dollar Golf taking place at Sun City, just up the road. Reports are filtering in that the beer being served there is properly cold.
James Greener
2nd December 2005.
