And now it seems that the French have also not been all that
accurate with their sums. Their generous leaders might just have promised quite
a few more goodies than there are euros in the kitty to pay for them. Oops. So
the dreaded ratings agencies are all over their case and downgrades are in the
wind. Now that the summer in euro land is over and the suits are back at work,
the cupboards are found to be just as full of skeletons as they ever were.
Readers of this column anyway will not be as surprised by this information as
many of the politicians over there profess to be. We have seen it coming. And
across the ocean there’s Mrs Cliff’s son Fiscal threatening to expose himself
to the population.
But even if the debt swamp is growing larger and deeper and
stickier, equity bulls in SA can’t see how that will cause companies to stop
making money and are happy to pay more and more in order to participate in this
anticipated profit bonanza. The All Share index is within a whisker of racking
up the three zeros at 38 000. As well as investors, shops and their customers
are on a roll. Newer and more expensive retail offerings are opening every day.
Consumers – presumably those fortunate enough to be on someone’s payroll – are
spending merrily.
It is notable however that everyone is avoiding mentioning one very
worrying fact. Amid all the demands for higher wages and salaries little has
been said about the arithmetic formula which shows that a fixed total wage cost
for an employer divided by higher individual
pay packets for the employees equals fewer employees. This is the inevitable
footnote to almost every drama and violent protest that has taken place in
recent weeks.
Just days after the last chicken bone and empty whisky bottle have
been cleared away from the opening ceremony for a Chinese motor vehicle
assembly plant near Joburg, it has been decided that it will not be used to
build the Inyathi taxi. Allegedly the South African National Taxi Council (Whatever
happened to their plans for an airline?) have been unable to guarantee the
quality of the product and have instructed their members not to buy the new
minibus. They might have said so before the party. But no worries. The Chinese
have another model they are sure we will like. Presumably, the Santaco bosses
will spend the weekend in overalls crawling over a prototype preparing their
guarantees for their members. I wonder if anyone has thought to conceal wads of
folding money in various unobtrusive parts.
Money, but considerably more of it, appears to be a stumbling block
to the clinching of another deal between two mining behemoths. The complaints
seem to be that not enough of it is
flowing in the right direction where it would sooth and boost egos, self-esteem
and attitudes. Minority shareholders somewhere will one day probably discover
that the stick they are left holding is the short end. It is the fighting
elephants and trampled grass story.
Who knew that the nation has a “berry corridor” somewhere near
Stutterheim where blue-, rasp-, black- and strawberries are farmed? The
southern hemisphere consumes 100 000 tons a years of these beauties and the
fellows in the corridor reckon that with a bit of balance sheet restructuring (i.e.
send cash please) they can increase their 2% share of this demand. As someone
who once picked strawberries for beer money (6 punnets equals one pint) I can
confirm it will be hard work but they deserve to succeed. Hopefully no busybody
politician plans to swing by and make foolish promises.
With Sebastien Vettel’s F1 champion ship not yet wrapped up, the
Proteas letting the Aussies break batting records and the ‘bokke looking tired
and lost with England still to play, it
might be a weekend where being away from the TV is a good idea.
James Greener
JFK assassination anniversary 2012
