LAYERS OF LAWYERS

The regular trek through the thicket of sometimes interesting price charts reveals that although the US share markets are amazingly strong (something President Trump is eager to talk about) the US dollar is not. Indubitably these effects are related and mute the share and commodity price rises for non-dollar players. Who and why are people selling the USD? Is there a real signal here or will it soon get swallowed up as a “correction”?

One of those statistics that sometimes creeps up on you is doing some very interesting creeping. For the first time in ages the value of South Africa’s exports in the past 12 months is very nearly the value of our imports. The general rule of thumb is that importing less than one exports is a good thing and the nation last enjoyed a protracted spell of this pleasant experience around the beginning of the millennium. The kicker in these latest figures is that it is the exports that are rising while imports are static. What a wonderful gift for president in waiting, Cyril Ramaphosa.

A hair-raising view of the future is doing the rounds on the internet. It assures readers that computer software is so rapidly developing and acquiring skills indistinguishable from bright and educated humans that numerous professions are so much under threat that youth are already shying away from becoming lawyers for example. Allegedly “you can get legal advice (so far for more or less basic stuff) within seconds, with 90% accuracy, compared with 70% accuracy by humans. “ 

Fortunately for our local legal eagles there is still a great deal of work in SA which is a long way from being basic stuff. Like keeping large numbers of politicians, bureaucrats and executives of businesses both private and state-owned from getting their just desserts. In fact, Christmas time just never ends for the nation’s lawyers. Meeting rooms in parliament and government buildings are stuffed with probes and commissions and inquiries trying to discover who stole how much from which state bank account. Every second newspaper story tells of a state employee suffering from total memory loss while taking cover behind a costly legal team. Courts around the land are filled with shifty individuals denying everything and awaiting the cue from the begowned barrister to burst into crocodile tears.  But we ought not begrudge our LLBs from earning their living. It has taken years of study and experience to attain their status. And it’s a tough job. Just this week Social Development Minister Bathabile asked counsel to define “a meeting”, presumably to enable her to deny having ever attended one. It seems that, since the unexpected and wholly unscripted defeat of the Zuma faction at the big ANC conference a month ago, the comrades are becoming far less friendly to each other. The phrase “throwing people under a bus” is in danger of becoming overused.

It’s interesting to read that there is a law in Holland which permits investors who have suffered losses presumably due to large share prices declines to try to recover their money from the company in which they had shares. An outfit named The Deminor Group are keen to act on behalf of shareholders in Steinhof. This company’s share price took a big hit when senior executives and board members apparently admitted they had no idea what was happening in the business and furthermore they were not there and it was not them. More “lawyering up” as the saying goes.

Another creeper is the Super Rugby Season which is now nearly upon us. Thankfully it has been trimmed back to 15 teams but still retains the messy “conference” tournament structure. It’s been difficult to give the local teams (Cheetahs & Kings) that were bundled off to the European Pro 14 competition last spring all the attention they deserve. Maybe because it’s not really rugby season. Meanwhile the delightfully described “dead rubber” cricket test series is trying to ignite interest in the final match at The Wanderers. Old Hiltonian Lungi Ngidi is finding the going a little tough as it’s certain that the Indians have told their analysts to scan the data and visuals for chinks in his armour.

James Greener

Friday 26^th January 2018

SUPER CYRIL & LUNGI

Newly elected ANC president Cyril Ramaphosa ought to ask some one to send him a chart of the rand exchange rate versus just about any other currency over the past 30 days. The dramatic and extraordinary 10% strengthening of our currency is obviously due to his election and the anticipation of the changes that will take place when he becomes president of the country. He must frame that chart and put it on his desk as a reminder of the faith that everyone is placing in him. Then he must call for the chart over the last decade and see the work that he still needs to do.

Recently a rather commonplace US aerospace event took place which initially caught the eye for two South African connections. The first was that the launch rocket was supplied by Elon Musk’s outfit. The other was that the mission was named Zuma. The intrigue thickened when rumours began that the payload was a secret US military satellite and that the launch had been unsuccessful. The news that Zuma might have crashed caused a frisson of excitement here on the southern tip until the details emerged. We sensitive South Africans began to fret that this was just another cause for national embarrassment. But we did also point out that Zuma was an unsuitable name for high tech. To date, despite senior US politicians asking questions, few facts are available. US military won’t even deny that it may have fallen into the fire pool at Nkandla.

Another odd choice of name is the word Zero for the nation’s newest bank. Doubtless there will soon be an excited PR piece of puffery pointing out the pontential and promises of keeping one’s money in Bank Zero. Apparently, it is to be an “app driven” bank so its client base will be ruthless and unemotional about switching to a different platform should Bank Zero fail to perform. This curious name is up there with Castle Free for its capacity to mislead.

Reportedly officials in Eskom’s finance and legal divisions were troubled by the secret R440m “signature fee” being paid to an “obscure offshore entity”. They apparently thought it might be a “disguised kickback”. Oh. Wow! Really? Surely not! Did any of said officials type the entity’s name into Google perhaps? Mind you, that R400m is less than 0.2% of the $2bn principal amount that our electricity utility has borrowed from China to keep the lights on. None of the world’s “fixers” will bother to get out of bed for such a paltry commission rate.  R400m back home however could build a few of the university lecture theatres that are so badly needed to fulfil our president’s wishes.

It’s Davos time again and our official delegation are on their way with those scarves in the colours of the flag that have become their trade mark at these events. It will be interesting to see how finance minister Gigaba, usually a snappy dresser, will handle this rather unflattering garment. By now delegates from other nations are grateful for the early warning served by these garish but iconic items about the approach of a sorry tale about the evils of colonialism and an outstretched palm.

I’m a great fan of the Dakar Rally and watch the snippets that appear on TV without fail. It is an epic event with almost a thousand participants driving odd looking vehicles at very high speed in incredibly rugged locations. It lasts a fortnight and important features of the pastime include getting comprehensively lost, utterly exhausted and sometimes quite badly injured. Amazingly there is frequently a cameraman on hand somewhere along the 750 km long day’s stage to record the confusion, despair and agony. Unlike other activitiess like shopping, banking, metered taxis and sending postcards which have been radically changed in the past decade by technology, the Rally steadfastly eschews the obvious boon of satellite based navigation aids. It also these days takes place in South America, a very long way from Dakar. Altogether a delightful and intriguing display of the human spirit.

As was Proteas fast bowler Lungi Ngidi’s maiden test haul of 6 for 39 in India’s second innings at Centurion this week. Way to go sir. And hopefully way to continue.

James Greener

Friday 19^th January 2018

SOMEONE IS POKING THE BEAR

The suggestion that an outfit called Viceroy Research based in New York is causing share prices on the JSE to go down and up is not impossible. It is probably an indication that diligent data mining is singling out shares which might be sensitive to some well-placed rumours and short selling. There may even be real reasons aside from illiquidity and ownership profiles why the shares are considered overpriced. Indeed, for ages many JSE listed companies have looked expensive when viewed under old fashioned valuation lights. The Steinhoff debacle – which seems to get more complicated every day – has definitely injected some edginess into the local market. Though finding this out has been difficult. Business Day, allegedly the nation’s leading financial daily newspaper, resumed publication after the Christmas break only yesterday. Exactly why they felt able to shut down even while the markets were open and while a very significant local business scandal was unfolding is hard to say. The so-called “dead-tree” media are hard to support when they treat subscribers like this.     

Finance Minister Gigaba may be overreaching his capacity for logic. On his way to celebrate the ANC’s 106^th birthday (Yes, there will be cake. Lots of it) and hoping to arrive in triumphal mode he laid out the requirements for the country to achieve even a modest 2% growth this year. Reportedly he claimed that “There are certain decisions we need to take, and if we take them the economy can exceed our expectations for the year.” Which begs the question firstly what are those decisions? Why were those decisions not taken years ago? And what if “we” don’t take them, even now? Sadly, given all that we know about the minister and his minders, none of the plans will include getting the government out of everyone’s way. The sole useful decision we need is to rewind and destroy the yards of red tape that the scourge of central planning has draped all over the landscape. Instead undoubtedly his ideas will include more instructions about what people must do, with whom and at what price. Calamity.

It looks as if some civil servants have been scaled back from Chocolate Digestives to Marie biscuits with their tea. The average year on year percentage growth in National Treasury’s monthly distributions to the ministries and provinces has plummeted from well over 6% to just 2,5% in just a few months. This has been forced upon them largely by the fact that tax collections are way behind what they had expected. There just is no money for the better biscuits. Conspiracy theories abound about the deliberate destruction of SARS from a once efficient and feared tax collection agency to a dysfunctional institution showing leniency towards JZ’s very many cronies and large family. If true, then the vastly more crucial expenditure items like the social grants and education and health budgets will also soon feel seriously strapped. No wonder Gigaba has begun to fret about the ratings agencies. He has learned how hurtful they can be.

The National Treasury website welcomes browsers with a huge banner advertisement inviting readers to “Name the New Online Budget Portal” and win a ticket to watch the Budget Speech live in Parliament. It’s astonishing that the “prize” of watching a “live” politician drone on in Parliament would have any attraction for someone who even knows what an online budget portal is. But if you do, please hurry. Entries close on the 15^th.  My entry is “Midden”.

Another sport another batch of dodgy administrators. This time it’s SASCOC officials, the folk who supposedly help deserving athletes to participate in international events like the Olympics, who are racing to court “to clear their name”. The levels of suspicion and distrust between the various directors and employees of the organisation has extended to bugging phones and offices. Which merely reveals to cynical observers that undoubtedly money is once again flowing in unusual directions and probably not anywhere close to actual sports men and women.

James Greener

Friday 12^th January 2018