Eskom unkindly unloaded our shed here in Illovo from their power supply network for four hours yesterday. These blackouts are not peaceful, however, as most office blocks now have a giant generator that fires up immediately the lights go out. Not everyone was pleased to have backups, however. During some of the more torrid bear market periods this week the idea was expressed that a total and long blackout of the JSE computers would be no bad thing. The share prices of some large companies – notably retailers with potentially toxic credit exposure – are more than 50% off their recent highs. The bear is undeniably in charge and it does not look like he is going away soon. Remarkably, the rand is not doing badly at all. On the other hand, sterling is getting trashed and a UK holiday this winter should be cheaper than last year.
News from the US economy continues to get worse and worse. Many respected commentators have declared that the country is already in recession. The flight to quality had driven US bond yields way down and it is likely that the Fed will drop their interest rates as well. This means that cash returns after inflation are negative and helps me understand why the gold price is chasing $900/oz. Oil too is not getting cheaper. The producers have realised that there is scant fall in demand even at these prices so why should they bother to reduce them.
Years ago, Mad Magazine carried a wonderful cartoon strip entitled Spy vs Spy. I think that sadly, its creator is now dead or else he would be able to see the strip come to life in the shenanigans now engulfing what is laughingly termed the government of this country. Only those people who have lots of time on their hands (i.e. politicians and civil servants) can possible follow the developments as they unfold. Trust, respect and integrity have vanished from the people who we had hoped would create and run a safe and prosperous country for all its citizens. And the horrifying thing is that we tax-payers are paying for these buffoons to play their games.
My dismay at this shameful shambles is almost eclipsed by my amazement at the foolishness being displayed at the conference of the world’s tax-collectors gathered in the shadow of The Mountain. In speech after speech to each other, they are bemoaning the fact that their “customers” are unwilling scheming low-lifes who will do anything to evade their grasp. They are in total denial of the reality that for every person in the world, tax is a hateful idea to which we reluctantly accede only because the state has terrible penalties for those who disobey them. Only their families would mourn if The Mountain were to topple over on their proceedings. Please don’t ever again invite them back to these shores. Any future such meetings should be held in a fly and snake-infested desert.
Some reports have complained that French president Sarkozy is spending more time with his new girl friend than he is running the country. The lady concerned is a super-model and time spent with her is undoubtedly much more fun than running a country. Our own putative president-in-waiting tied the knot with another wife last weekend but from the pictures I have seen, Mr Zuma’s swift return to work this week was not surprising.
It is wonderful that for once, there is a big cricketing squabble going on and we are not involved. My aversion to Aussie cricket renders my view suspect, but I do think that their victory dance behaviour is rather childish.
James Greener
11th January 2008
