Friday 28 October 2016

KEEP CALM AND CARRY ON



This would seem to be the slogan of the moment. Even with the many distressing political and social events unfolding every day there is scant evidence of panic in the prices. But as the old adage says: If you are going to panic, panic early. Perhaps it is interesting to see demand for the US dollar taking the greenback stronger against most other currencies. But it’s not yet a huge thing. Locally there’s a perfectly normal mix of good and bad trading statement updates. Of course, there’s still the annoying and unhelpful yapping of the Competition Commission terriers desperate to unearth the tennis balls they suspect are hidden among the nasty profiteering worker-hating capitalists.
There are so many inferences one can draw from the sight of Number One falling asleep while Minister Gordhan unpacked the bad news in the mid-term budget. The charitable one is that JZ had prior sight of the document and was hearing nothing to which he had not diligently applied his mind. The conspiracy view is that nodding off was a deliberate snub and show of contempt and disdain for his Finance Minister. But we do know that our president has form in being baffled by large monetary numbers and is not much interested in matters such as tax increases and spending cutbacks if it doesn’t threaten his personal arrangements. As a precaution against unhappy citizenry wanting to get close and personal to discuss these matters JZ has increased his security cordon. Road-users have been warned to expect even longer and faster blue-light motorcades.
Those of us who have picked through the MTB numbers find a bleak picture which once again raises the question that if all these years of central planning have brought us to this low growth mess why not try something different. Like letting people spend their money as they see fit and not have to give it to a politician for them to squander. And although Gordhan has scraped together quite a bit more cash for the frankly selfish tertiary level learners, early signs are that this will not meet their demands and total stupidity remains the fall-back position. Us oldies still puzzle why immediate and permanent rustication is not handed out to those who do things like light a fire on the floor in the sports hall.
It’s very significant that the US presidential election takes place just a few days after Halloween.  Voters will have some experience of witches, ghouls and pumpkin heads and so will not be totally terrified by the choices that their great nation has awaiting them in the polling booth. That iconic image of a mother holding her new-born up at arm’s length and saying “One day you could be President” obviously hasn’t worked for years. No sensible family would be proud to see their offspring enter politics and indeed the evidence suggests that few do.
Stories are coming in of a new low in the treatment of visitors arriving at Joburg International having to wait in line for hours to have their “biometrics” processed.  Our leaders have decided that it is necessary and useful to capture all ten finger prints of every new arrival. However, a shortage of both staff and equipment is making things go very slowly. Now what risk is the country trying to manage with this tedious and unfriendly process? Are the finger prints being matched in real-time in some huge global data base of foes and felons? If not, then all that can be happening is that these exciting “biometrics” are merely being tagged with the details in the passport presented by the visitor. It’s worth noting that there is zero guarantee that those details do identify the now enraged and delayed money-spending arrival standing in front of the immigration officer. As our own country’s fraying reputation in this matter shows, forged documents are common.
The local rugby season is over and now the administrators take to the field. There’s a lot to accomplish country wide if the ‘bokke are to be revived. Already there is considerable traffic through the door at the Sharks offices.
James Greener
Friday 28th October 2016


Friday 21 October 2016

CATERWAULING


Although it seems unlikely, the charts confirm that the current rand / dollar exchange rate is at about the same level as it was a year ago. Ditto the All Share index. That’s despite all the seemingly investor-scaring stuff that has taken place (see below). Maybe it’s that the current batch of fleeing emigrants haven’t got that much money to take away with them anymore. Maybe we are exporting stuff steadily and quietly without attracting the attention of the analysts. Judging from the glossy property flyers someone must be paying tens of millions for a view of the South Atlantic Ocean from one of the world’s most congested cities!  If it wasn’t for the politicians and the students, one could get quite optimistic about our southern tip.
But the number of things too impossible to believe continues to grow. Much of the difficulty in trying to grasp it all lies in the illogicality of everything. How can the act of setting fire to a library be seen as a) non-violent and b) furthering the cause of education? How can making universities ungovernable be in the interest of poor or indeed any students? Is there just one cabinet minister with a real and properly earned recognisable and appropriate qualification --- even a matric? How can the president express complete faith in the man upon whom the same president has set his goons to destroy?  Why is our power utility lending money to the president’s friends? Is JZ ever in the country? Is that reason for leaving the ICC really true?  Is it possible that astonishing actions and provocative statements are sometimes planned and made largely to elicit responses of irritation and dismay from the indignant and immaterial minority?
Next week we will have to suffer the so-called medium term budget presentation by the minister of finance – that is if he hasn’t been locked up for the utterly heinous crime of granting a member of staff an early retirement package. Although the month to month data are not getting any worse – the government fairly consistently spends one rand for every 87 cents collected – it has been doing that for the past half dozen years and the total debt is mounting up. And when the nation gets its Christmas present from the ratings agencies of a creditworthiness downgrade, the interest payments on all that borrowing are going to soar. A balanced budget is never going to happen in the lifetime of this government. It’s going to require more than just the axing of some of the silly little ministries to solve that cash flow problem. Hopefully the trainee bureaucrats presently trashing the nation’s campuses are impatient to use their expensive education to show us all how to do it. So far, however, their proposals to soak the rich and press-gang private enterprise are not going to raise nearly enough. But sums like that are always difficult and so colonial.
Undeniably there is an urgent need to lower the cost and improve the standards of internet connectivity in South Africa. Unfortunately, (and unsurprisingly) the state is moving at a snail’s pace to achieve these things. The Cabinet has set up a war room (!) to “expedite the implementation of SA’s broadband policy.” But so far the “terms of reference” are not yet agreed! The failure to implement the migration to digital terrestrial TV is one frustrating stumbling block in the process. This is such a fast moving and innovation driven business that the best thing government can do is step aside and let private enterprise sort it out -- something they are already doing if all the aggressive marketing is a guide. But one does sort of wonder what most of the bandwidth is really used for. Messages like this and other vital and trustworthy communications must surely comprise a tiny fraction of the torrent of entertainment downloads and pictures of cats and food. Social Media is a dreadful misnomer. A room full of screen peckers is not at all social. The dreaded hash tag has nearly replaced real journalism. It’s so easy to select material that panders to one’s prejudices and not to confront contrary opinions. Does it not make sense that we want to do that cheaper and quicker? Did someone say work emails? Pshaw!
The opinion that SA rugby is hamstrung by having far too many regional authorities is very compelling. It seems worth trying to spend less money on staff and more on players. Competition for fewer places both in the coach’s room and on the field might sharpen things up. It could hardly make it worse. The only person more depressed about his team than a ‘bok supporter must be an Aussie cricket fan. Apparently Northern Transvaal will be in Bloemfontein to finish off the Currie Cup tomorrow. What a pity that today is Global Champagne Day.
James Greener
Friday 21st October 2016

Friday 7 October 2016

LET THE MARKET DECIDE



Running through all the usual charts there are few startling developments beyond the strength of the London share market and the weakness of its currency. Somehow both factors are being blamed on Britain’s exit from the European Union. Even our old anti-sports tour foe Peter Hain has emerged from somewhere to tell SA what a disaster Brexit will be for this country. But all forecasts of woe and gloom would be forgotten if global economies rebounded and everyone got busy again. Those looking for positive signs will see twitches of life in some of the commodity prices. Others, however, will be absorbing the amazing messages about how quickly and accurately intelligent machines are performing tasks in even the so-called knowledge based professions. Lawyers it seems will be particularly affected. Mind you the champions of driverless cars obviously have never been to Africa. It will be a while before a computer will be able to tell which lane the taxi will use next.
The two ministries tasked with equipping the young people of South Africa with the knowledge and skills they will need to compete in the world spend nearly 23 cents of every tax rand collected. But this funding is insufficient and every institution needs to collect fees to survive. Fees can be abolished only if the nation agrees to cover the shortfall by increasing either the fraction (at the expense of other services) or the total tax collection. Or indeed both. Please will the noisy and violent ones tell us how to balance these equations.
In the meantime, education is in a mess. Only in some small enclaves where vestiges of old systems and standards survive is anything effective coming out of the state owned and run institutions. Parents, the majority of teachers, and once they are old enough to grasp the issues, the learners (dread term) are frantic.  Politicians and bureaucrats are racing to distance themselves from the mess. President Zuma made only a cameo appearance before bolting from a meeting where he was expected to be presidential. The buck passing is breath-taking.  
There is scant likelihood that central planning can solve this problem and only the market can do so. Simply return school education, at least, to be a local competency run by parent-elected school boards and principals. Close down every provincial ministry and release everyone (teachers and administrators alike) on those payrolls to go and offer their experience and skills to the highest bidders. Many will be disappointed to learn what real employers think they are worth. And then critically, through a mixture of tax cuts and education vouchers, return the money to those who are the actual buyers of education.
Those baying for free education – “because it is a right” -- and militant teachers’ unions will not like any of this very much, but maybe more kids than at present will be able to reach heights they currently have no hope of attaining.
In the meantime, over at another hall of government it has been decided that we drink too much booze but the good news is that it’s not our fault. Apparently the blame lies with the people who sell us our tipple. They should not serve us if, in their view, we have already had enough. This of course dovetails neatly into the current climate of not being responsible for one’s actions and makes the police’s job that much easier as they can simply ask the drunk where he purchased his last toot and arrest the offending shopkeeper or barman. The proposed legislation also reinforces the quaint notion that 500m is just far enough for a school- or church-goer not to be tempted by the demon drink. But perhaps the most difficult thing to understand is how the twin statistics of our world-beating liquor consumption, and our desperate levels of poverty match up. Someone is fudging the numbers.
Last week it was Pretoria. Now its Durban. Each city got to host both a cricket and a rugby test against antipodean teams almost back to back. The hospitality industry hopefully did well. The only missing piece to make it perfect will be if the ‘bokke hand the All Blacks their first loss in years. This would be even more spectacular than the sight of a Formula 1 engine “letting go”. The smoke and flame and driver frustration makes for a great spectacle.

James Greener
Friday 7th October 2016 (The Tide will be out next week. I’m going birding/drinking)