Friday 12 March 2010

NUMBERS GAMES

The rand is doing some very heavy lifting and month-to-date it is more than 3% stronger against most major currencies. The IMF boss man was in town this week to finalise his ticket selection for the world cup and took a moment or two to warn us that adopting polices that might  weaken the runt would be a bad idea.  Just what those polices could be was not explained although there was a time when having clueless politicians chanting racist slogans would have been good for 15% off the price by lunchtime. Once upon a time those guys were so lethal that we had to create a dual currency.
In the meantime most share markets are going nowhere in particular. Sit tight and enjoy the dividend payment season. The imminent arrival of a decent sized coal mining company on the JSE boards is a welcome development.
It is puzzling that there has been such a fuss about the President forgetting to send in a list of his business interests, although the excuse that his lawyers had been trying to find out if the laws of the land actually applied to him was a bit alarming. Doesn’t the government already know everything about every one of us? Nearly every transaction or communication these days requires that you provide your ID number, your mother’s maiden name, where you live, and an eight character password (that must include at least two digits and upper and lower case letters). This week the cell phone company MTN complained that their profitability was impaired by the need to ask these questions of their customers. Those who didn’t know the answers had to be turned away. Presumably this information trickles through to some state information collector and even if they don’t know how to use it, I have no doubt that Google have already found a way to do so. So many people with something to sell now seem to have my email address and my phone number.
It is perhaps unfair and curmudgeonly to ridicule the efforts that are being made by government to ensure that the world cup will be a great success, but the sticky and grubby fingers of officialdom are appearing in places that would be best left to people who actually do that sort of thing for a living. For example the Department of Transport is only now looking for 1400 people to become drivers for a new bus service between cities during the event. In what may be an award winning understatement, the CEO of this proposed service has reported that “there was clear agreement that driver training was an important element in delivering a successful operation…” That is so comforting. No mention, however, of how all those well trained folk will actually get drivers licences in the 90 days until kick-off. It takes weeks just to get a learners appointment.
Sadly it turns out that the much promised police drive against crime is mostly about shuffling titles and designing new uniforms. Turning the Service into a Force will also not worry the bad guys very much. The harshest penalties are reserved for people who fail to remember that the erstwhile Commissioner is now to be addressed as General. And there is an extra helping of scrambled eggs on the peak of his cap.
As well as fretting about having to cut back on the allowances for the royal household, the kingdom has been pretty concerned with the matter of rugby referees this week. Us Lions fans have more than enough of our own woes, however, and today’s score line is just adding to them. And then the new F1 season is about to begin with all theses new names, teams and rules. I am pretty sad about the refuelling ban, as that added a wonderful strategic aspect to the race as well as the chance to see some flames occasionally.
James Greener
12th March 2010.
[There will be no Tidemarks for the next two weeks.]

Friday 5 March 2010

DIRECTIONLESS

The President’s entourage for the state visit to Britain is reported to have numbered several hundred. It must have felt like Isandhlwana all over again in the Palace. No wonder the UK  were nervous and rude. The pound fell to a four year low against the mighty rand as the throng unpacked their cases and sold beaded trinkets, wooden giraffes and Bafana Bafana shirts to the crowds along Whitehall. With so many bureaucrats away, the B-list had an opportunity to get into the local headlines. Minister Patel who was obviously miffed not to have been invited to go along, retaliated with a proposal to raid everyone’s pension fund to pay for his new empire. The department of health published an error ridden report confident that the people who could read were overseas and some other worthy was so shocked by what today is being passed off as art that she declined to open the show and left before the refreshments. This quite insignificant teacup storm triggered a froth of portentous drivel about freedom of expression and the dangers of ignoring the Constitution. This important document is under far worse threats than that posed by a sensitive lady shocked by a few arty pictures.
There was little in the way of a major theme or story in the markets beyond the Greeks complaining that the very nation that was being so mean to them now was the same one that stole their gold sixty years ago. Our biggest bank (Standard) revealed the rather poor results that it had warned us about but that seemed to excite the buyers who immediately leapt into the share. In fact the whole banking sector became quite skittish. Old buddies in the steel business who went their separate ways a few years ago had a very public squabble which smacked the ArcelorMittal price quite badly.
While not necessarily yet plunging further into full-blooded nationalisation, our undoubtedly socialist inclined government is not averse to increasing their control over every area of business. This development imposes uniformity and equality but contrasts with their present very keen and assiduous ferreting out of any whiff of cartel or collusive behaviour. It is often asked how there can be just one competition commission and one government. The latest culprits are alleged to be bitumen suppliers and poor old Sasol is being hunted again. The only ray of light in the incident is that if the price of the stuff now falls after this investigation, perhaps we will see some potholes being repaired. But did anyone notice the bread price fall after that last swathe of fines on the bakers?
 Instead of fining a local tax evader and demanding cash, SARS this week drove away in three of the culprit’s luxury cars in lieu. The delinquent taxpayer was unfazed and reportedly declared that there were plenty more cars in his garage. I don’t think the tax man has done the right thing there. He is now a seller of some exotic wheels and any shortfall between the tax owed and the sale proceeds will presumably just need to be written off. Perhaps, however, there is no plan to sell them and the President will soon appear in a Rolls Royce with Durban plates. One of the wives might score a Lamborghini.
The arrival of Bafana Bafana to play a match in the new stadium one night this week provided one useful preview of what June may bring. This was the extreme reaction of the Durban traffic authorities to international soccer. More than three hours before the game kicked off at 8:30pm in front of a crowd no larger than often turns up at Kings Park alongside, the city became gridlocked. Traffic cops infested every intersection within miles of the stadium and either closed it off, or more lethally, formed random teams of hand-waving uniforms out of sync with the operating traffic lights. I wonder what time the poor fans got home after suffering the equally poor soccer. Or had the cops knocked off by then?
James Greener
5th March 2010.