The All Share Index has been playing a great game of tease. This
week it even set a new all-time high at 34 800 and pretended that it was about
to make a significant upside break-out in total defiance of my forecast. But that
failed to materialise and a sharp and nasty correction has trapped a few bulls.
The talking heads have offered several excuses for this behaviour. The dead
giveaway that they too have no idea what is happening is that the same excuse
is offered for both the up and the down excursions. Headline grabbing news of
the moment is the decision by the US Federal Reserve once again to gallop to
the rescue with sacks of money and buy US government IOUs (sometimes
called bonds). In turn, the government can use this fresh money to rescue their
favourite causes – mainly banks. This puzzles ordinary folk, as rightly they
wonder why organisations that cheerfully admit to losing a couple of billion, merely
because their counting isn’t very good, deserve such largesse. Hence the yo-yo
behaviour of the share prices as investors try to decide if all this market
intervention is good or bad news.
Another very puzzling decision right here at home is the
announcement that our delegation to the G-20 meeting in Mexico agreed
to pop US$2bn of the nation’s foreign exchange reserves into an envelope and
leave it on the hall table for the International Monetary Fund to collect when
they next come down this street. Only the brightest and most sophisticated
analysts and economists are able to explain why this is a good idea. Apparently
it will make SA look all grown up and cool hanging out with the good guys and
doing what they do. The rest of us who can think only in terms of piles of
folding stuff languishing in a vault are baffled. That the cash is destined for
something called the “firewall” only adds to our misgivings. We will watch
carefully to discern what return this “investment” delivers.
The bureaucrats have come up with a proposal to create yet another
database of names and addresses to which we will have to supply copies of our
documents. This time it is the present national driving licence system which
has been declared suspect and forests will die to provide the paper to fill
another warehouse. And of course provide a rich source for anyone contemplating
a spot of identity theft.
This comes on top of the allegations that a similar database of cell
phone users has utterly failed to reduce the crimes that were going to be eliminated
by knowing where everyone lived. Similarly, despite all that FICA stuff the
baddies still appear able to open and operate bank accounts that are more
effective than a laundrette, while I may not trade for a client of 25 years
standing who has recently moved house but failed to send in the inevitable certified
copy of proof of residence.
And then there is the ever growing list of restrictions on the sale,
advertising and use of cigarettes and liquor. When I last checked these were
still perfectly legal methods for calming the nerves after dealing with
stupidity and the state happily pockets revenue from their use. Surely there
are many other life-threatening dangers which are not the result of free choice
to which the government more urgently ought to be directing its attention. We
would like to see the perpetrators of violent crime being pursued at least as
vigorously as someone who leans over the garden gate with a fag in their mouth
and a beer in their hand.
At last the Solstice has passed and we are into the season when the
shortening evenings get filled with ever more sporting extravaganzas from
around the world. The ‘bokke are on the verge of scoring a hat trick against England and yet
there are fools fretting that this winning side does not meet some irrelevant
distribution standard of province and parentage. Anyone who wishes to support a
national side that rarely beats the opposition is directed to the soccer team
which is delivering a master class in providing poor value for their sponsor’s
money. Go ‘bokke. Make it three out of three.
James Greener
22nd June 2012
