Despite the recent excursion down to 33 000 the JSE All Share index
has really done nothing decisive or even very terrifying for four months. Such periods do of course have to end though
when, and in which direction, one should not predict. Nevertheless, I can see
no reason why it should move up sharply in the near future and rather think
that the next piece of surprising and market-moving news is likely to be
bearish. It seems that world economies are slowing down sharply and we may
experience a longer and deeper recession than the titchy one that visited us in
2011. That one, however, was ended when politicians discovered that they could
order their central banks to open the taps and spray voters with money. It’s a
sure bet they will try that trick again if they need to. Would it work again?
It is quite obvious that the designers and champions of the euro
currency system have no idea about what to do for their failing experiment. Its
success was very dependent upon member states and their citizens being honest
and truthful about their situation and obediently following the rules. The
inevitable triumph of human nature to pay as little as possible while claiming
as many benefits as possible has now come to the fore and the experiment may
need to be shut down. The politicians’ belief that they alone are able to allocate
resources in an equitable and acceptable manner is exposed for the idiocy that
it always is. The sole solution on offer involves ever increasing amounts of
debt but the problem is that the lenders are now alarmed by the possibility
that they may not get repaid and the borrowers have become used to and in many
cases utterly dependant on someone else’s money. Now even we distant observers,
perched on the southern tip are feeling the effects of this meltdown as our
customers and friends in that part of the world are increasingly preoccupied
with their domestic issues and are not all that interested in our problems or
products.
But maybe our woes are about to be solved by the re-shuffle of the
cabinet announced by President JZ this week. Unfortunately, many of the really
incompetent and ignorant faces are still there, albeit some are now lurking
under different hats. There is a certain schadenfreude
in seeing that a particularly arrogant lady has been moved to the portfolio
where her immediate task will be to deal with the civil service wage claim and
probable strike. The pres also appointed a new police commissioner, opting this
time for a woman with no policing experience at all but reportedly a whiz at
administration. If nothing else she will hopefully compile a neat list of
unsolved cases – on a very long piece of paper. Can it be right that she
already is using the title General?
Still on the government’s speed dial is Professor Stiglitz, the
economics Nobel Laureate who gets trotted out to deliver appropriate opinions more
or less on demand. He has just starred in the latest episode of the never
ending soap opera of the state trying to find a way of stopping Wal-Mart
bringing their damaging free market methods and ideas to SA. The professor
helped draw up a plan where the American retailer donates a vast sum of money that
will be used to identify which local producers are unable to supply the store
with the goods they need. Bureaucrats and certain economists are unable to
grasp that this is exactly what the marketplace is doing 24/7.
The road to the bowling club this evening may be closed. The Durban
Council have unconvincingly attempted to demonstrate that the city will benefit
from spending public money to get the three stooges from the Top Gear BBC TV
show to drive fast cars aggressively around the streets of the city. The
organisers may have forgotten the Umgeni Road Taxi Association also use these
roads and are inimical to the idea of road blocks at peak hour. Watch for the
14-seater Toyota
minibus with the coloured wavy stripes.
The ‘bokke did alright last Saturday, but England are going to be especially
pumped up tomorrow at Ellis Park. I must remember my ‘bok cap.
James Greener
15th June 2012
