Things are getting pretty tetchy at the door of the National
Treasury coop as more and more chickens are struggling to get home to roost.
This week it was revealed that in calendar 2012, our politicians and
bureaucrats managed to spend a record-setting amount of R184 bn MORE than even
their sleek computerised revenue collection services had extracted in taxes.
This 12-month deficit is almost 25% larger than was reported a mere six months
ago. The tax eaters are pulling on their spending boots now that their role
model and figurehead has been confirmed in the top job for the next half dozen
years. However, bond yields actually declined a bit showing that no one has any
worries that people will be hesitant about lending money to Zuma and his merry
bandits in order to cover this shortfall. Curious.
Also curious was the sight of the dollar losing ground versus the
euro. The side with the currency that will now buy 12% more dollars than it
could in July is an assorted mismatch of
quarrelsome nationalists all lying to each other about their finances and determined
to get someone else to pay for their time in the sun. The declining currency,
however, belongs to a single country that still runs, by a good margin, the
largest economy on the planet and which amazingly is showing signs of gradually
pulling itself out of a debilitating slowdown. Maybe there were things
whispered in the bars at the Davos knees-up that have not yet filtered down to
us mere mortals. The US
bond market is weakening, with 10year yields touching 2%. Although on a chart,
the 50bp that have been added to this yield in the last few months look benign,
the reality is that bond holders will have taken some pretty hefty losses. All
that creaking in the rigging suggests that the winds are picking up.
Anyone looking for more financial puzzles can mull the local share
market which delivered a very useful 3.2% last month. This was despite double
digit declines in many of the retail shares and more backsliding from the gold
and platinum miners. Their woes were exacerbated by the Minister who drew on
her total lack of any experience at meeting growing payrolls while losing
customers to deride mine management’s plans for survival. If you think she was
unreasoning and angry then, just wait until she finds out that no profits
implies no taxes paid. Most of the heavy lifting in the index came from the two
effective rand hedge stocks of SAB Miller and Richemont which propelled their
sector indices also by double digit percentages.
Obviously my decision not to drink beer in January (nor to buy
expensive handbags) had no impact at all on projected earnings of these two
companies. However, this nation’s love for and obsession with a winning sports
team is a wonderful and exciting phenomenon utterly misunderstood and ignored
by the self-obsessed kelptocrats that so mismanage our sport. At last someone
has told Bafana that the object of the game of soccer is to hoof the ball into
the opposition’s goal and that there is no need to perfect the victory dance
routine without doing that several times first. The city here is incandescent
with excitement as our team advances to the quarter finals in the Moses basket
stadium here tomorrow. If we win, the budget deficit can go to multiples of GDP
for all anyone will notice or care. Now that the minister of sport has all but
declared the Proteas' captain Graham Smith a National Key Point perhaps he too can expect serious upgrade to
his digs?
Visiting St Helena island in the
mid-Atlantic fulfilled a wish. Like most isolated places it is unique and
intensely fascinating, however, it would be a good idea not to annoy the Brits
as it is still their destination of
choice for banishing people to. Napoleon and 6000 Boer war prisoners were not
the only ones sent there. Only a nine-hole golf course and no Wimpy or sandy
beach. Rather windy too. A challenging spot to live in for any length of time,
ask the Basil Read chaps there building the airport
James Greener
1st Beer Day 2013
