Friday 28 May 2021

LOVELY RITA METER MAID

The total rand amount of the earnings reported by the constituent shares of the JSE All Share index over the past 12 months has recovered enormously since the low recorded in the last quarter of 2020. In common with many informal and anecdotal reports in the same vein, this is welcome news but very had to explain. Where is the money coming from to fuel the reported surge in demand? Tidemarks suggests that we are witnessing the most perfect example of trickledown economics ever recorded. Public money raised by taxes and loans pass effectively and efficiently almost directly into the hands of those eager and unafraid to spend it. On themselves. This is a chain which is unlikely to be broken by seeking to install incorruptible and civic minded officials and bureaucrats who will deliver what the citizens expect and more significantly need if this nation is to become competitive. The chain is large and seemingly comprised of networks of a small number of large families. Their most annoying characteristic of this self-denoted A-list elite, after a talent for grand larceny, is a complete denial of any arithmetic which demonstrates that their lifestyle depends on a very small number of increasingly disillusioned payers of very large taxes. Their insistence, for example, that there is demand for the resurrection of the SAA the state- owned airline has no basis in any financial or transport universe. Recently Tidemarks wondered who was brave enough to take on the minibus taxi industry and break the news to them that “Really it would be jolly sporting and patriotic of them to start paying income tax”! And now the government want these same taxi drivers, along with everyone else in the country, to give up their hand-guns. The government’s thesis is that there is no need for individuals to have a weapon for self defence. Really? This was a bad time to choose to release a photograph of a suite of rooms, presumably in Pretoria, where the Firearm Registry, operated by the police, reportedly store their records. It was, one must say, surprisingly neat. But the sight of tonnes of paper stacked from floor to ceiling without a shelf, bookcase or filing cabinet to be seen raises doubts about just what is being controlled in this manner. Presumably these records are the original sheafs of A4 forms completed by gun owners over the past few decades when the previous system was changed. So now there is RTIA - the Road Traffic Infringement Agency, another grammar-challenged newly formed outfit that feeds on public money. It is tasked with administering the “Aarto Value Chain” an oxymoronic and meaningless concept. RTIA is complaining that it will need to rely on other state agencies like the Department of Transport and the South African Post Office to do its job. Further, RTIA is dependent on the NCR which is administered by the Road Traffic Management Corporation. And perhaps worst of all, The Government Printing Works is responsible for printing the Aarto notice books. Oh no! How will they ever do their job? And do we actually need it? The TV producer who decided to start interviewing athletes hasn’t bequeathed us a universally winning idea. While their appearance on the screen is normally due to noteworthy or exceptional performance in their discipline, not all are gifted speakers or natural and interesting commentators. Especially not if they have just completed a gruelling session of physical effort. Euphoria, excitement and adrenaline will carry them only a few sentences down the road before their words – often in a foreign language – are banal and embarrassing and only their parents are still listening. Unwisely producers often welcome the sports man or woman who is articulate or emboldened enough to use the TV exposure to espouse a cause that is unrelated to their talent and achievement. Naomi Osaka the very successful tennis player has announced that she won’t fulfil the media obligations (i.e. answer trite and silly questions on camera) required of her at the forthcoming French Open. She will be fined for this breach of contract and has chosen to pay her penalties to a charity. It certainly raises the question of just who owns Ms Osaka’s time when she is not on a tennis court. James Greener Friday 28th May 2021

Friday 21 May 2021

THE DATA FOG IS CLEARING

Our much reviled and despised currency, the South African rand is daily setting one-year highs against major currencies. This is embarrassing for those who prefer the bear narrative about the nation going to hell in a handbasket. Even the share market tarnishes the thesis that the ill-conceived and largely medically ineffective lockdowns utterly destroyed our economies. The All-Share Index is lurking in the mid 6o thousands and has challenged 70 thousand on a few recent occasions. Like the parson’s egg there are clearly parts of the economy which are quite excellent thank you. As anyone whose daily life necessitates a trip to the supermarket can tell you however, grocery prices are going up and even the carefully massaged inflation metrics are confirming this. But the CPI has not yet done enough climbing to cause the usual knee-jerk reaction from the Reserve Bank. They again left the repo rate unchanged this week. There clearly is a WhatsApp group for Central Bankers who peck away at their smart phones under the bedclothes until late at night discussing the price of money. No one wants to be the baddy and start to reward the savers who have been patiently waiting for a bit more interest in their monthly pay out. It would be such fun to see this thread when it moves to the subject of cryptocurrencies. The citizenry is quickly realizing that the pandemic is not as infectious or lethal as our leaders have been assuring us. Increasingly the health industry globally is singing from the same song book and the rest of us can begin to sort the likely truth from the wishful thinking and suspiciously deliberate misinformation. We are these days less easy to terrify and bully. And so now it looks and feels as if our leaders are becoming more interested in rummaging through the nation’s rubbish bins seeking dirt with which to smear each other. Some are even perhaps returning to their real jobs. For example, the Independent Electoral Commission have decided that it will investigate whether conditions will be conducive to free and fair local government elections in October 2021, particularly in the context of Covid-19. That should keep them busy. Spoiler alert: Yes of course. Meanwhile bleeding fingernails must be the order of the day at the SARS head office. Despite starting off telling the civil servants that there simply was no money for honouring long standing pay increase commitments, suddenly there, down the back of the couch in the Commissioner’s office a few rusty coins and tatty notes were found and have been offered to this rather grumpy cohort of public employees. It remains to be seen if the trove is enough. In another part of Tax Towers, squeals of delight can be heard from the tax-collecting gumshoes who have discovered the unlooted medical aid reserve funds. Just the latest in the various private savings accounts that the desperate government is about to prise open with some adroit reinterpretation of the rule books. At first sight on TV the Kiawah Island golf course in South Carolina where the US PGA Championship is being held this weekend, looks startlingly similar to courses here on the south coast. Mamba infested groves of coastal bush with clumps of palm trees and rough which would be better described as jungle or lush grasslands. Then the drone rises to reveal the course to be an amazing enclave squeezed between the Atlantic Ocean and some evil looking swamps which the US commentators are proud to tell us are unique. So far, the first day has been very entertaining. Which is what one hopes we will get from the iconic Monaco F1 Grand Prix. I will refrain from my annual complaint that my invitation to join a party on the poop deck of a grand yacht moored in the harbour has gone astray. But I do look forward to seeing what the spectator policy is going to look like. The restricted number of fans who at last are being allowed to attend Premier League matches in England have been behaving exactly as they warned they would and are booing the ridiculous and inappropriate officially mandated display of support for a racist lobby group, unconnected with any sport. It will not end well. James Greener Friday 21st May 2021

Friday 14 May 2021

SOME ELECTRONS ARE LESS RENEWABLE THAN OTHERS

Here we go again. Someone wakes up to the fact that minibus taxis aren’t paying much income tax and everyone feels that something must be done about that. Unsurprisingly not too many folk are volunteering to break this news and begin handing out tax return forms to the owners and drivers within this massive but pretty lawless business. The reality is that it’s probably best if we just leave that tax uncollected. After all, one of Tidemarks’ old shibboleths is that it is extremely unlikely that the government would be able to distribute that money as swiftly and widely as the industry itself is probably doing. They are running a pretty good case study in the benefits of economic freedom. For most of the world the Covid thing appears to be shaking down quite quickly with different levels of public rejection of the wilder and woollier requirements for behaviour modifications. Nevertheless, some governments seem to be particularly loath to give up the powers they gave themselves to control their pesky populations. In case you didn’t notice, our “State of Disaster” was this week rolled out another month. But its hard to tell. The last holdouts to “normality” are of course mostly those whose emolument was unaffected by the lockdown and who have yet to return to their usual places of work. Complicating any understanding of the status and impact of the virus are the various statistics which show huge improvements in the economy since a year ago. This a faulty comparison as that was when there were penguins were tottering through the streets of Simonstown and surfers were being arrested. The lockdown was hard and brutal and neither booze nor ‘baccy could be sold. Compared to the pre-covid periods we are way short of a real widespread recovery. Here on the southern tip as usual we are doing things quite differently. There appears to be scant urgency to administer any of the vaccinations that the rest of the world has adopted so enthusiastically. Why that is, is hard to tell but a possible reason is that the pathways to cadre riches that the ruling party like to map out in any expenditure of public money are unclear. Already the supposedly unavoidable and imminent third wave of infections is being blamed on the feeble vaccination program. Tidemarks would like to draw readers’ attention to the collision of two phenomenon These are Elon Musk and Bitcoin The former it seems has reversed an earlier decision to accept the latter in payment for purchase of his Tesla electric car product. The offered reason drips with hypocrisy. Elon is now worried about how much dirty electricity is required to “mine” a Bitcoin but is unconcerned that the same energy source is used exclusively to power the novel car. Years behind schedule, the national broadcaster SABC is only now switching off the legacy analogue terrestrial TV broadcasts in order to meet an international agreement to free up “spectrum” for mobile data. SABC’s channels will soon be transmitted only in digital format from the familiar array of huge masts dotted around the countryside. To watch “The News” and other fiction offerings churned out by SABC, viewers need to get a decoder (Just as Multichoice customers need to unscramble the digital TV signal broadcast from the DSTV satellite.) Much of the delay in getting to this point was due to the government working out how to ensure that their voters would continue to get the benefit of a daily opinion from a political worthy. After all, folk who do not buy TV licences are not going to purchase a decoder. Viewers on the old system, due to be cut off finally in about a year, are now getting messages inviting them to register for a free government-subsidised decoder. Um. So not all that free really then? Oh the excitement of the domestic rugby season. The Lions play the Stormers and the Bulls play the Sharks both on Saturday. The latter clashes with the FA Cup but few people care about much of this. The absence of audience is awful. The WHO have recently pronounced that “There has not been one verified covid infection transmission in the outdoors”. Is this real or just some pressure from Japan, the panicking Olympic hosts? James Greener Friday 14th May 2021

Friday 7 May 2021

ONE OF US IS SUSPENDED AND IT IS NOT ME

Most real trained economists can be distracted for a couple of hours if asked what the price of money (i.e. interest rates) should be. They are amazingly variable over an astonishing wide range, sometimes even falling below zero. Indeed, there are several situations around the globe at the moment where depositors are being charged interest (which surely must be the wrong word) to lend their cash to a borrower! Fake untrained commentators like Tidemarks can’t grasp what this means for the economy of a nation where this takes place. It nevertheless does not seem right. Interestingly the debate about negative interest rates is heating up again as part of a growing discussion about how perhaps administered interest rates having been too low for too long. But the flaw in thesis is that there exist people and committees who know what the correct interest rate must be. And these wise men and women from time to time reset this rate and the nation’s economy surges forward on this wave of intelligence and insight. Um. Almost certainly this is not the case! Throw in the fact that that governments just love to tax interest flows and one has the makings of a complex system for which open transparent markets are the ideal price-setting mechanism. In contrast, the issuing and renewal of driver’s licences should be a cheap and seamless service delivered by technology with minimal human intervention. (Except for the driving test – but watch this space). However, this week, Transport Minister Fikile Mbalula used nearly every cliché in the politicians handbook to describe what will happen. He was excited that the process will in future be “atomised” and the new licence will be redesigned to incorporate and adopt new technologies. such as blockchain and other related technologies which will form the platform of an integrated transport system.” Sadly, he didn’t promise that his staff would “work around the clock” so most likely many of us might not ever receive these new licences. Just before President Cyril became embroiled in the ridiculous play-ground shouting contest with the ANC Secretary General Ace Magashule about who had the bigger mandate to fire the other, he joined a love-in with Finance Minister Tito Mboweni. This duet was about the need for another State Bank. This is such an old and boring song that reappears whenever one of them forgets that they don’t know how banks work. In a series of posts made on social media, the finance minister said that the ‘cry for a state bank is loud, clear and urgent’. The queue of depositors however is short, risk-averse and vanishing. The folk who create the never ending stream of legislation that dribbles out of the corridors of power really don’t have a clue. Neither frankly do many of the commentators who are called in to write about and praise the latest slab of extremely annoying and implausible instructions on how to run a business. In their minds thanks to the glossy TV ads, they see plush offices staffed with crisp efficient laptop-toting meeting attendees smiling and laughing as they devise yet another illegal way to squeeze the clients and customers and make another couple of million before morning tea. The reality, as most of us know, is quite different. Those lucky enough actually to have a job. divide their time between begging clients for orders or payment and telling compliance officers not to interfere in the delicate balances we have crafted in order to keep afloat. A most peculiar story has emerged from the rugby tournament known as the Varsity Shield bubble(?!) now in progress. The team from Walter Sisulu University (with 31 500 students on 4 campuses in the region that used to be known as Border) have been performing the New Zealand “haka” before their matches. Among the reasons they have provided for this choice of a foreign symbol is that they admire the way the All Blacks play. Further they have won 3 world Cups. Errr. Yes. So has another team called the ‘bokke. Anyway, after receiving a polite and kind letter from New Zealand rugby, the WSU fellows have stopped making fools of themselves but to be fair it did seem to work. They beat Rhodes 63-10. James Greener Friday 7th May 2021