The more cynical amongst us think that all those who marched around Gauteng to promote their
demands for “Economic Freedom” have a fairly narrow definition for the phrase.
This would entail the transfer of hard cash into their outstretched hands on
the grounds that their undoubtedly penurious and disadvantaged background
entitled them to it. It is not meant to be either cruel or flippant to point
out that everyone now has the Economic Freedom to participate in any enterprise
for which their skills and training fit them. The protestors would get much
more sympathy if they directed their anger at those government polices which
make it difficult for capital and labour to negotiate without pre-conditions that
ignore the supply and demand situation. What ever the well-fed, beret-wearing,
t-shirted firebrands on the truck leading the march might proclaim, the bare
fact is that there is insufficient wealth in the entire country for everyone’s present
demands to be met in full. Eventually one realises that arithmetic is far more
powerful than promises. And that is why I worry about the bull market.
One economic freedom that we can all enjoy is to refuse the ruling
party’s centenary offer of a limited number of 1 kg commemorative gold
medallions priced at almost three times the value of the gold they contain.
Whatever your level of veneration for President Jacob Zuma, his stamped profile
can not add that much value to a disc of the yellow metal. For those looking
for something more portable there are also one ounce coins, bearing celebratory
images and text, on offer at R72 600. Compared to Krugerrands trading on the
JSE at around R14 000 this is also an outrageous premium despite the enticement
of a Certificate of Authenticity signed by the president himself. The selling agent’s
breathless marketing claim that the actual trading prices will easily exceed
these indicated opening auction prices is dubious. Be warned, the secondary
market for these baubles is very very thin.
Maybe the suits in Euro
Land have solved the
crisis. Or maybe they haven’t. In fact probably all they are trying to do is
make it go away until they can retire with their enormous tax-payer guaranteed
pensions. The compelling irony is that it is these numerous tax-payer funded
guaranteed benefits and entitlements which are a major contributor to the
crisis. Another factor is the cost of lawyers whose task it is to trawl through
the multi-lingual thesauruses for euphemisms for “broke”, “default” and
“dishonest”. As mentioned before, this arithmetic stuff can be so darn
inconvenient.
The increasingly impressive Finance Minister Gordhan laid out some
undeniable arithmetic facts in the half-time budget speech in Parliament on
Tuesday. He does become a little over-excited about the fiction that taxpayers should
share his idealism for frequent and copious contributions to Treasury.
Nevertheless the fact that the government spends lots more than it collects and
therefore has to borrow more and therefore has a bigger interest bill was
cogently made. I also liked his plan to claw back money allocated to
departments but unspent. If you leave it there it will grow legs. Already,
however, his warning about the modesty of next year’s salary rises has been
rejected by the unions.
I watched in awe as All Black captain Richie McCaw lifted the Webb
Ellis trophy totally without assistance from any politician or official. Our
own captains have always been accompanied by a president or two to help them
heave the golden trophy into the night air. Richie must be very strong.
Presumably Golden Lions captain Josh Strauss will not risk the Samson effect of
shaving off his luxuriant but repellent beard before he hoists the Currie Cup
at Ellis Park this weekend.
James Greener
28th October 2011 (and a pox on
stores with Christmas decorations up already)
