In the last dozen
years or so a largely benign practice has evolved into an apparatus that
severely distorts many financial markets. Committees which set (amongst other
things) the interest rate that a central bank will apply when it lends funds to
the private sector have assumed powers and delusions of infallibility way
beyond their scope and skill. Not only is the decision of each meeting handed
down to the grateful and waiting population as if it were sacred wisdom but the
minutes of those meetings are revealed a few months later for the pundits to
dig through in the hope of gaining insight into the workings of supreme beings.
The very words and the order in which they appear are taken as omens and
portents of the future.
Allegedly this
interest rate ought to influence pretty much every aspect of the economic
landscape and most importantly control the level of economic activity within
the nation. Clearly it doesn’t do it very well, if at all. Recently in
desperation in some parts of the world interest rates have been lowered to
below zero and are now negative. This requires that lenders pay borrowers a fee
to accept a loan! The consequence of this kind of nonsense is that investors
are ever more willing to pay higher prices for the shares in companies which
really don’t deserve that level of valuation. Perhaps when the crash comes, the
wise men will find a way to let markets and not committees set the price of
money. That won’t remove booms and busts but they will get turned around much
more quickly.
A reason put forward by Brigadier-General
Marthie Visser of the South African Air Force for the acquisition of three more
lavish passenger planes was the increase in the country’s international
commitments. Apparently the president, his deputy, the minister of defence and
any one else whom JZ declares to be an “envoy” with such a commitment, is
entitled to an upgrade to one of these sleek beauties. The only “envoys” with
international commitments that most of us could identify would be national
sports teams. Politicians and bureaucrats could conduct what little useful
stuff they do by Skype or at a push an economy class ticket. If there is a
foreign functionary who feels that they just must see Number 1 in person –
perhaps to hand over a present or something – then they can come here. Pretoria is best at
Jacaranda time.
It’s odd that students are being
revolting quite so early in the year. Usually it’s the looming mid year exam
season that creates the need to find other things to do. Now that the
life-threatening lump of bronze has gone, the UCT campus presumably is today a
silent haven of academic endeavour. Within the context and standards of his
time Cecil John undeniably made a very significant and long lasting contribution
to the development of our chunk of Africa. One
wonders if there is today anyone among the dancing throngs who in their lives will
make a similar impact and whose peers will in due course subscribe to erect a
memorial to sit upon the empty plinth. Here in Durban, public money was used to install an
unsmiling and perhaps even unflattering bronze head of Mr Moses Mabidha in the precinct
of the huge and iconic soccer stadium that bears his name. The puzzling thing
is that Moses was a communist and not a footballer. Perhaps he too ought to be
moved to somewhere more appropriate.
Lots of sport for the couch coaches to
supervise this weekend. The Masters golf and the Grand Prix fixtures are
already underway and shortly after the rugby tomorrow there’s the Boat Race.
It’s an easy choice to select the Lions cap to wear in the TV room. Surely
every one else is also too embarrassed to wear a Sharks shirt after last
weekend’s disgraceful display?
James Greener
Friday 10th April 2015
