AND YET MORE MONEY TO TRY AND FOLLOW

These fellows at the International Monetary Fund are a soft touch. They have agreed to loan our government $4.3bn at a reported interest rate of around 1.1%. No payments of either capital or interest are required until late in 2023 at which stage the debt must be extinguished within the next couple of years. Apparently, the conditions attached to the loan are rather benign, merely expecting that this nation will behave like gentleman and use the money wisely. The cash could arrive within a month. The already deeply disillusioned and sceptical commentators like Tidemarks are amazed that it is all so simple. Even without the highly probable misuse of this loan, the real downside risk is that it is denominated in dollars and who knows how many rands will be required to buy a dollar that far out? Of course, repayment is due after the next general election and the communists may by then have been sent packing and the rand could be at parity with the USD. Joke.

Is there not one ruling party politician who, despite being totally blinded by their cockamamie ideology, cannot see the complete disaster of a nation with fewer people gainfully employed than there are collecting social grants. The difference is now at least 1 million upturned palms. Of course, passing this tipping point around now is a consequence of the official response to the Covid-19 pandemic but it has been headed this way for a long time. The State of Disaster  -- which now has only a fortnight left to run its originally declared course  -- has provided a wonderful and readily acknowledged smokescreen for the Marxists, behind which they have ratcheted up the pace of their program to reduce this nation and its people to impoverished beggars utterly dependant on the state for decisions and livelihood. Our sole hope lies in those private sectors which have sufficient customers to be able to cock a snook at the lockdown regulations or find illegitimate routes for meeting customer demand. The former is of course famously the minibus taxi industry and the second are the manufacturers of booze and cigarettes. Sadly, the education sector has fallen prey to fanatical left-wing trade unionists uninterested in facts and careless of the future of the pupils. And because the health sector has been the beneficiary of large amounts of poorly managed cash to help it with the crisis, it too has become a major focus for the crooked tenderpreneur classes who have turned the provision of simple infection control supplies into a cash cow far bigger than any of President Cyril’s buffalo bulls. The utterly obscene fact that sales of super luxury exotic cars are growing while death by starvation is taking place, makes every South African except those whom we pay (far too much) to do something, to hang their heads and weep with anger and shame.

There is something of a traffic jam on the route from Earth to Mars. For a reason based on space geometry, three craft have been launched for this journey in just the last 10 days. The latest, a NASA mission with a rover named Perseverance, left just yesterday for a one-way flight lasting about 7 months. Assuming a successful landing on the red planet, it will then spend at least a year rolling around, poking a huge array of sensors into its surroundings. Among the most intriguing instruments it will deploy are a microphone and a soil sampler. The first will presumably listen to what any passing Martians have to say like “Yanks Go home!”. The samples however will be stored in tubes for later collection by another space craft to be launched in the next decade or so. This reveals that the problems of a two-way journey to Mars and back are certainly not yet solved. So, beware any slick salesmen named Elon from Tshwane selling vacation breaks on Mars!

Not everyone involved in professional sport is despairing of the lack of crowds of spectators in the stands. Presumably the slick on-line betting businesses get lots more action from the armchair-bound fan than from one in the wet plastic seats juggling a beer and their smart phone with a patchy signal.

James Greener

Friday 31^st July 2020

TIME FOR A STIFF DRINK. OH, WAIT.

Now that the UK have left the EU – and nothing much seems to have fallen apart – there is less news from that region that seems worth understanding. Except for the prediction that Italy might be the next to go and the Irish received a bill from Brussels for Services Rendered which has soured the taste of Guinness. Nonetheless the euro has been quietly gaining against the US dollar in recent weeks, so something is afoot. Its hard for Tidemarks to believe that forecasts of Biden winning the presidential race in November are credible, though undoubtedly that would do the greenback little good.  The similarity between the political choices in the US and SA are surely coincidental. Unappealing characters in or standing for president. Strident women with far too much power. And woefully and wilfully ignorant left wing extremists with a taste for violence.

Company results for periods where the lock down was well underway are starting to trickle in and the picture is terrible.  The JSE market index that tracks the larger market capitalisation shares in the industrial and financial sectors is reflecting an average decline of 15% in reported earnings over the last few months. This is of course not the worst we will see. The cavalier and callous government program that is relentless, terrifying and ongoing, appears to be planned to throttle far more life out of the economy than any lives it might save from an increasingly better understood viral infection. Last night the President backed down to demands from the teacher’s unions and fiddled with the public-school calendars again, They are to be reclosed “until the peak in Covid-19 related deaths has passed” A mendaciously vague target. The private schools – catering to a numerically rather trivial fraction of pupils – have been left alone. One suspects that like private hospitals, these usually better run facilities are where the cadres choose to seek education and health care for themselves. Hypocrisy is present in industrial strength quantities.

Obviously, earnings declines like this will show up as similar reductions in dividends. And yesterday’s cut in the repo rate to 3.5%pa means lower interest payments. The conventional wisdom is that borrowers will now be able to afford more debt and this will stimulate increased commercial activity. In the current environment of a punitive and deadly attack by government on private enterprise this is clearly and fatally wrong. Those businesses which have survived to this point have little appetite for debt regardless of its price. This is demonstrated by the news that the government’s R200bn loan scheme for small business affected by the lockdown has attracted little interest among the target market. Lenders, landlords and investors are also facing a crisis. Their income streams are similarly collapsing.

There is a kind of race emerging that unfortunately is towards the bottom. Either through stubborn adherence to dogma or deadly ignorance of mathematics the government have created a fast lengthening list of beneficiaries from the public purse. These comprise state employees (three tiers of government plus uncountable numbers of wholly state-owned agencies) and social grantees. The other runners in the race are those who supply the government with the funds to meet this terrifying monthly wage bill; that is taxpayers and investors in the state’s debt instruments. The inarguable fact is that the economic depression that has been caused and is being deepened daily by government can be reversed only by a very serious cull of the beneficiary list. There is almost nothing more to be gained by approaching the other side. The tempting feature about the cull is that it could reveal the whereabouts of some of the stolen trillions which were deftly extracted from public gaze by legions of crooks and thieves over the last few decades. Sadly, most of it has been very thoroughly laundered by now. Great folk for cleanliness are the cadres.

Meanwhile the most wonderful classic comet seen in years has rounded our Sun and is on its way back into deep space. Following some rule about these things the comet was named NEOWISE after the satellite that first spotted this object. This in turn stands for Near Earth Object Wide-field Infrared Survey Explorer. Catchy hey? Anyway, it is well worth asking Google for some of the pictures that have been taken of this comet. They are breath-taking.

James Greener

Friday 24^th July 2020

SCIENCE CONFIRMS THAT OPEN TAXI WINDOWS DETER THE CORONAVIRUS

The headlines chunter on about the foreign investor’s selloff and exit from the SA markets and yet the dear old rand is clinging on and is even up a bit over the last few weeks. How do these facts gel? Had every one of those sellers already gone short of the rand long before dumping the shares and bonds? Unlikely. The answer may lie in the stats about foreign trades published by the securities markets. These figures depend upon a small and inconspicuous flag being raised on the client entry page of the labyrinthine booking and admin systems.

The year 2020 is proving to be the most awful mixture of the COVID 19 pandemic, the US presidential election and an explosion of left-wing political activism. These three phenomena have been inextricably mixed into a potpourri of horror, fear, vindictiveness and ignorance by politicians with agendas and objectives far removed from what their oaths of office promised. The sole good news may be that there are signs that the nature and dangers of the pandemic are becoming better understood by most of the medical sectors and flickers of hope can be detected. Many places are able to report that the “curve is flattening”.

Ordinary folk, however, are wary, especially because decision makers continue to point out that the deadly virus is still at large, and the best defence is to flee and shelter. It is increasingly obvious that this advice is mendacious. In this country especially, the side effect of the lockdown, which even now is in some cases being tightened, has been to remove the right and freedom of citizens to create and provide goods and services for sale to each other. And that means unemployment, poverty and starvation. And there is little evidence that those responsible for this situation care very much.

Rule is now by diktat with punishment of all for the behaviour of the few. Reportedly police believe there are no more than 5000 anti-social criminally inclined people who rape, pillage and murder, especially after a few drinks. Why are they not the target of a concerted program of arrest and conviction? Virus or no virus. The sole industry to tell the politicians that their ideas are crazy, and impoverishing are the minibus taxis. They are a strong and violent lobby and government has crumpled before them.

It is inconceivable that the dead and buried idea that SAA can be revived if only because the people “deserve a national airline” or other such nonsense is back in the news. Why has President Cyril not told his staff and colleagues to stop wasting time on this project and do something useful? The cadres just do not believe that the money for everything, including sustaining their lifestyles, has run out. The first seeds of this poor airline’s demise were probably sown many years ago when it thought fit to grant free rides to all officials above a certain rank even after they had retired.

Another symptom of the pandemic may be that it has caused many people to lose their capacity to detect irony. In the last few months, the growth in support for what can now be seen to be an extreme left-wing and often extremely violent political movement that is vehemently anti-capitalist, has been amazing. They have persuaded many of the world’s richest professional sportsmen, whose mid-boggling incomes are utterly dependant on egregious rampant capitalism, to adopt their slogans and rituals.  English Premier League players not only replaced their names on their shirts with this movement’s offensive and racist mantra, they also all compliantly drop to one knee before kick-off.  Formula 1 who are valiantly trying to revive an eye-wateringly expensive sport also tried to get the drivers to “take the knee”  and obviously called in the public relations gnomes who have sold them the meaningless and clearly untrue slogan #We Race as One. Meantime Ferrari have other problems. It is interesting how the long unexpected layoff has shown up in a distinct rustiness and loss of focus amongst the sports men and women. There is obviously something in this “muscle memory” idea.

James Greener

Friday 17^th July 2020