Saturday, 30 January 2016


It must be something of a let-down when, a few weeks after your appointment to be Governor of the Reserve Bank, it dawns on you that there are only two things you are allowed to do. Either raise the repo rate. Or drop the repo rate. At first you enjoy prowling the huge office with private lift and exotic wood furniture. The view out over Pretoria is stunning. The computer has lightning fast connection to Facebook and Twitter and there are some very nifty games loaded, but as soon as you try to boot up anything that looks like work all the keys except the up and down arrows are disabled. This week to alleviate the boredom you gave the up key two firm taps and gratifyingly, a few things like the rand and the JSE perked up. But now there’s two months before you can do anything again. Perhaps you will be invited to make a speech explaining why you and all your predecessors believe that making money more expensive will make other prices less so.
Somewhat unexpectedly, except of course by the permabulls, the JSE all share has staged a very valiant comeback and by month end (that’s 5 pm tonight) could even deliver a January total return figure around -3%. Astonishing and rather annoying for those of us awaiting single digit pe ratios before topping up our portfolios. Since the rand has also perked up a wee bit, this suggests that at least some of the buying has come from offshore. When viewed in other currencies the price of many South African assets must be mouth-watering. Let’s just hope the foreigners don’t just crate them up and take them home though!
NECSA is (or rather should be) a quiet, unobtrusive enterprise dabbling with nuclear physics. Despite being totally state owned the South African Nuclear Energy Corporation seems to have a successful market for their product range of glow-in-the-dark type materials used often for medical purposes. One would assume that the staff would be mostly white-coated nerdy types managed by ruthlessly safety conscious suits. However, there are deep and violent upheavals going on at NECSA which are hard for outsiders to follow. Undoubtedly there must be considerable sums of money at stake, and the source of so much mysterious moolah is quite likely to be one of our president’s new best friends. That will be the one who is going to get a very secret and egregiously overpriced contract to fit us out with nuclear power stations. Hence the (very nasty) musical chairs going on at NECSA to get a seat nearest to the trough? An interesting aside to this story is that the obvious acronym, SANEC, was already in use by those nice people from the Netherlands who want to do business with us. This suggests that the rebranding process from the previously named Atomic Energy Corporation was rather slapdash.
Equally alarming is the corporate bloodletting taking place at the Receiver of Revenue’s office. SARS is already very good at tracking down any loot that we citizens try to hide so it is puzzling that some officials there are trying to effect a major reorganisation in that agency. There is abundant speculation that next month’s Budget speech will have to announce even more and painful ways to squeeze revenue from the population. Could it be that cronies and backers of Number One have been whispering in the presidential ear that they would be much obliged if SARS manged rather carelessly to delete their files. Hence the need to place obedient and trustworthy cadres at the coal face. Just saying.
The dodgy government project which seems to have been set up both to buy votes and reward loyal manufacturers and distributors of set-top boxes for terrestrial digital TV has lurched back into prominence. Taxpayers are now funding layers of lawyers to defend the government’s decisions not to encrypt the SABC TV broadcasts and also to give away 5 million boxes free. This unwarranted delay in migrating viewers away from the old analogue broadcasts is partly responsible for the country lagging woefully behind its peers in internet connectivity measures. Priorities are terribly awry.
So if the Proteas dominate the pyjama games will they give us back the Test mace? I doubt it.
James Greener
Friday 29th January 2016