The JSE All Share index is now in its sixth month of almost
uninterrupted ascent and it is hard to remember any specific pieces of good
news in that time that might normally be expected to drive such optimism. There
were, however, all kinds of what might be considered bad news, only they
weren’t. Investors are looking through the problems and pitfalls that we
analysts wail about. Instead they have firmly believed, correctly as it turns
out, that most companies are still able to find customers and make sufficient money
to distribute to shareholders. In the last 10 months the dividends paid by the
industrial / financial sector have been growing at a rate of almost 20%pa. That is astonishing, especially if you
believe the story that the nation’s economy is growing at barely a tenth of
that rate. It feels as if trouble ought to be brewing.
Developments in this land are providing incredible material for
future generations of economic historians. One intriguing event this week was the
demand by an idiot that overseas customers for fresh fruit should now cease to buy
from South Africa.
The reasoning apparently is that this will punish those farmers who are
suspected of underpaying their workers. I trust someone has pointed out to him that
in the absence of sales there will in fact be zero wages. The cynical amongst us know that there is in
fact scant real concern for “the workers” in all this fuss and it is about the
organisers getting recognised and invited to join the gravy train in the more
luxurious coaches closer to the restaurant car. The blame for the ruined
industry they leave behind is shoved onto the usual legacy scapegoat.
Globally, unemployment is becoming a giant headache and the obvious
conclusion is that the policies and actions of the pinheads who claim to run
our countries was the cause of this calamity. And yet they still demand our
votes and support so that they can “fix” it.
Is there not a set of prices
(wages) at which each one of us would, metaphorically speaking, be prepared to
take in someone else’s washing, thus providing a cascading chain of value-adding
employment?. The problem is that politicians and their satrap bureaucrats have broken
the chain by promising that in exchange for us electing and supporting
them, no one will need to do the most
menial and lowly jobs in the chain. They will, they say, “redistribute” the
wealth from those so obviously undeserving at the top of the chain to the
hordes at the bottom. However the plan doesn’t work for long. Or even at all.
This is a message that has not apparently been grasped by someone
who is now always referred to as “the billionaire businessman”. This is Comrade
Cyril Ramaphosa, who has just been chosen by the ruling party to be the
nation’s next deputy president. To demonstrate his struggle credentials and to cover
his embarrassment at holding a seat on the board of the deeply troubled Lonmin
platinum mining company, he has offered some alarming ideas about
redistribution. His thinks that in addition to paying workers a salary,
employers have an obligation to ensure that their employees enjoy some
unspecified minimum standard of living. Some of the implications of this view
are that it patronisingly suggests that employees make flawed choices when
spending their salary. It also says that the salaries are inadequate and so
commits each company to a quite unknowable extra cost and duty to help that
employee attain and then maintain the desired standard. There is no denying
that far too many people in this relatively wealthy country live in appalling
conditions and it is in a politician’s job description that they need regularly
and loudly to promise to change this situation. Comrade Cyril’s government has
indeed achieved a great deal of success in using taxpayers money to alleviate
hardship, but to mug them as shareholders for the same cause seems very wrong.
I am now going to St
Helena Island.
Napoleon as well as number of Boer prisoners of war died there. So
(temporarily) will my ability to see what the markets and politicians are
doing. The next Tidemarks will be written only in February.
James Greener
11th January 2013
