Two million rand. This is the price that the auctioneers expect to achieve when they sell a Pierneef painting next week. If they do, then it will be a record for a South African painting. The sellers will be hoping that there are a couple of oriental art lovers amongst the bidders, who will emulate their countryman who last week purchased a big chunk of Anglo American for a record price. That price was a bit more than two million rand though. I have been thinking about the significance of the founding family deciding that this price was too good not to take the gap. Why should we mere onlookers expect it to go higher even as the rand gets stronger and the commodity prices cool off?
That I am not alone in these thoughts is clear from the All Share index, which perhaps significantly did not set a record high this week and is set to close near its week’s low this evening. Big losers this week are almost exclusively from the resources sectors. Banks and other financial institutions have done all right but not enough to rescue the overall indices. I doubt, however, that the bears need yet to pop down to Arthur Murray and polish up on the footwork for the victory dance. Company results filling the papers this week were crowing about earning growth above 15% pa in most cases and sometime three times that in others!
By the way, I am pleased to see that the JSE appears to have ceased their silly plan to cancel their requirement that companies publish their results in the newspapers. Despite the arrival of the electronic age almost everyone including the big name analysts, still prefer to have the broadsheet format to pore over and scribble on. Somehow, it is also not so easy to hide the provisions and impairments on a printed page.
I never tire of remarking on the buffoonery that the tax consumers spend our money on. This time it is the Reserve Bank’s Labour Market Frontiers Report that attracted my attention. What on earth is a “labour market frontier” and have SARS set up customs desks at the border posts yet? The report relays the news that their surveys discovered that “the higher the level of skill, the higher the monthly wage received by the worker”. This research should have the Nobel Prize selectors in Economics looking up the dialling code for South Africa. The Reserve Bank ferrets are pleased to note sycophantically, however, that government policy will enhance the supply of skilled labour and thereby reduce this wage inequality in the future. But what policy do they possibly envision will encourage people to upgrade their skill, other than the fact that a plumber earns a lot more than the fellow carrying his (or her) toolbox; and usually more than the householder who called him out to fix the leaking loo. No one of course will come close to the earnings of the suits that compiled the report and we all know which side of the labour frontier they are on.
The ‘bokke have also crossed a border this week and many of us are hoping that the bus gets lost in Wales and they never get to Twickenham. That’s probably the only way they’ll be unbeaten. And just imagine my frame of mind next week if the Proteas fail to bowl out India on Sunday. This is going to be a long and tense weekend.
I hope you enjoy parts of it.
James Greener
17th November 2006
