So it turns out that the man with a name that sounds like a menu item in the farinaceous section, and who was going to buy Goldfields, does not exist. The bloodhounds from the regulators are now sniffing about for someone to sink their canines into. Some lucky investors will have enjoyed a huge windfall when the rumour about Mr Pastorini first broke. Regulators hate it when people claim a quick profit. It makes them suspicious that someone knew something before someone else. Oddly, however, they are not so worried when people suffer a quick loss from trading on presumed “inside information”.
In the last few months, the following entry will have been laboriously pencilled into the pocket diaries of quite a few central bankers. “Got up; ate breakfast (cornflakes); went to work; changed nothing; came home; watched self on TV; ate supper (beans on toast); went to bed.” Our own governor will have made his entry just last night. World-wide, it seems that the price of money is perfect and there is no need to tinker with interest rates. Naturally, there is incessant speculation in the markets on how much longer these central bankers will be able to bear this inactivity. Eventually one of them will pull the lever and rest will gleefully follow suit. I do wonder why, in these supposedly free-market economies, we need a committee to decide on this important parameter. Several years ago, here in SA, we experimented with a daily auction system to set the repo rate. It had some serious teething troubles and displayed terrifying volatility but it was settling down nicely when the meddling bureaucrats decided that they knew better and returned us to a fixed rate model.
The mayor of Johannesburg has declared that migrants are the lifeblood of the city and has proposed setting up a desk to “advise them on how to access government services, get information on economic opportunities, social networking, counselling, legal advice and shelter.” The likelihood is that the queue in front of that desk could be extremely long, but that would provide ample opportunity for social networking, so he could omit that part of the brief. May I offer His Worship the suggestion that perhaps it is the ratepayers who provide him and his crew with their own particular lifeblood? Perhaps he might ask them if they want to encourage yet more people to the city when the existing desks in his offices already are unable to direct his current citizens to economic opportunities and shelter.
But today’s request by the United Nations Development Programme in South Africa for proposals to provide them with a banking service shows that our local officials lag way behind the global bodies when it comes to milking the masses. The fee for simply going to an office in Pretoria and collecting the necessary form is R8000. The good news is that the UN does promise to try and choose the successful bidder within four months. Until then I suppose they will be keeping their money in a box under the bed. If so, they can expect frequent visits from elements representing the less formal sector of the wealth management profession who pursue their own development programme.
The record market high occurred on a Tuesday this week.
Only the strongest amongst us will be able to watch cricket this weekend.
James Greener
12th April 2007
