The undercurrents in many markets are picking up speed. Prices of shares, commodities and even ephemeral entities like crypto are mostly all weakening quite sharply. Currencies, which are difficult to think about because they are expressed in terms of each other are quailing before the US dollar. Holders of the US currency are now getting modest returns as interest rates rise from a long period of nearly invisible levels. Does this suggest that the “smart money” is expecting that the forthcoming “mid-term” elections in that country might deliver an optimistic result out of what looks, to some of us, to be a nation and empire tearing itself apart. The president, his vice-president and his press secretary are none of them able to able to speak to and cogently defend a single idea being hatched in the White House. Mind you the number of current world leaders able to do that is small. Our own man won’t even discuss the price of bulls these days.
The rest of the world are, for example, puzzled by the fact that the mighty USA is terrified by the health threat apparently posed by admitting a super fit and healthy young man enter the country to play tennis, while thousands of similarly unvaccinated refugees wade across the Rio Grande. Is there some yet unpublished science about the malign medical effect of tennis racquets?
There is a deliberately created and maintained mystique shrouding topics such as “high finance”, “government accounts” and “economic policies”. However, stripped bare of the jargon it, turns out that that no matter how large the organisation might be, it all boils down to keeping a record of money flows into and out of an account. Our South African Government is one such organisation and appears to be particularly diligent and transparent about their record keeping. Especially at the highest level which is called National Treasury. Sadly, this standard frays badly as the cash and record keeping processes trickle down to the lower levels of ministries, local authorities and state-owned enterprises. But returning to the top level there is some largely unexpected good news shining from the end of several rather long tunnels. On average the state’s coffers are recording tax inflows of around R135 billion a month. This is a massive amount. The slump in government income caused by the lockdown and the closure of markets including liquor and tobacco has been all but erased. At the lowest point of government income in that dreadful and economy-destroying time, September 2020, the equivalent income figure was R 102 billion per month. In fact, even the most optimistic forecasts and extrapolations from any time in the past two decades would probably not have come close to today’s actual amount. Tidemarks apologises for not being able at this stage to pinpoint the sources of such bounty, but the publication deadline curtailed further investigation. Most likely it will turn out to be windfall income from mineral exports as commodity prices soared. It certainly won’t have been growth in personal income taxes or VAT. The matching figure on the expenditures side which records how much our leaders and their employees are earning for themselves and distributing and spending for others, is some R161 billion a month on average. This represents an overspending of about 20% which is less than the 27% chalked up in April 2020. Nevertheless, the nation would still undoubtedly benefit greatly from decreasing the civil servant head count and converting tax-eaters to taxpayers by relaxing the regulations about who can pay how much to whom to do what.
The video clip of proceedings at a recent press conference called by COPE, one of the many small political parties here in SA, suggests that we have untapped depth of skill for rugby team selection. The speed, nimbleness, power, focus and aggression of the delegates trying to seize the microphone, evade tacklers, and enforce possession of territory is amazing.
James Greener
Friday 2nd September 2022
