Even though the All Share index has not yet set a record high this week, its impudent younger brother, the Top 40 index, has done so. Once again, bears are sporting egg- splattered faces. The main reason offered for week’s bullishness is that Governor Bernanke chose to drop US interest rates and surprised everyone with the aggression and style of the move.
This is the first time since taking over the job that Helicopter Ben has tugged on the big lever in the corner of his office at the Federal Reserve. He is the man who is on record as saying that dropping dollar bills from a helicopter is also a feasible central bank strategy for addressing monetary problems. He must have been sorely tempted to invite his predecessor Sir Alan for a short chopper flight this week. The aging alleged guru has been seizing the limelight with unhelpful commentary and a book of criticism about his former bosses. Tacky.
Another unappealing idea has turned out to be the system of quasi-government so-called Education and Training Authorities (SETA). Dozens of these things exist and each one feeds on levies raised from real businesses within different industries and sectors. Naturally, the quality of staff running these leech-like entities is highly variable and all too often stories of incompetence, corruption and larceny reach the news. One example appeared recently when the dullards that run the Transport SETA announced that they had written off their R252m investment in the disgraceful Fidentia Asset Management outfit that collapsed. Fair enough, anyone can make a bad call, but firstly to slip into the announcement that a further R2m from an internal fraud was also gone and secondly to claim that the Authority would still be able to meet all its commitments despite this shortfall is breathtaking arrogance. If this is true, why did they need so much money in the first place?
The notable feature of the futures close-out yesterday was that the JSE systems pretty much handled the massive volumes without any serious calamities. No particular price trend emerged during the event and I guess that traders were more focussed on domestic practicalities of getting the deals done than watching the overseas screens for news to panic or exult about. That came later in the day when the Proteas slid ungracefully from the Twenty 20 world cup event. I suggest that we get our money’s worth from these well-paid young men by assigning them to stadium security duties for the rest of the tournament. They should not now be permitted to withdraw to their golf-estates and watch on TV as the Aussies lift the darn trophy. With now only one sports team left in a world cup tournament, SA Breweries are probably correct in their forecast that the country will not run short of beer in the next few weeks.
More bad news for taxpayers appeared this morning in the form of a R70 000 advertising bill to allow the Department of Health to scold us for not appreciating them or their minister enough. Just do the job lads and you’ll get all the appreciation you deserve. And I hope that the Home Affairs department has noted that the Chinese are reportedly solving their problem of jobless rural citizens moving to the cities by sending them to Africa. That’s OK. Just don’t send the planes back empty please. In the markets we call it the switch trade.
The ‘bokke really should be able to make our Heritage Day long weekend and national braai day reasonably happy. Can anyone actually find Tonga on a map?
James Greener
21st September 2007
