Whoops. What’s happening here? The All
Share has shed nearly 2000 points since this time last week. Bears have been
spotted taking an exploratory swing of their claws in many other markets as
well. Is there just the merest hint of
panic in the air? Can this be the beginning of the end? Probably not. Buyers
are a resilient breed and the temptation to buy shares a few percent cheaper
than they were a week or so ago is hard
to resist even if earning are not going
up at nearly the same rate as the prices seem to do. Good news is that the rand
price of gold has recovered a year of losses.
Lots of fingers are suddenly being
pointed at China
where it is suspected that their ongoing demand for the world’s minerals is not
as large as it ought to be. As with all data prepared and released by anyone
with an agenda it is impossible to separate the facts from the propaganda and
it is only when the orders fail to be placed will suppliers know just how bad
life is going to be. Anecdotally I can tell you that there seems to have been a
marked decline this year in the number of ships waiting in the ocean outside Durban port.
Apparently being without electricity for
a couple of hours isn’t very serious. Minister Gordhan described it as “an
ankle kick”. Leaving aside the fact that some ankle kickers can leave quite a
lot more than a nasty bruise, it should be appreciated that we domestic retail
and office consumers are being inconvenienced only after many of the really
large industrial customers have been shut down for days and in some cases
years. Simply put, even if a dodgy supplier sends a load of duff wet rocks
labelled “Coal” round to the power station now and then, Eskom just does not
own enough generator capacity to meet the real unrestrained demand that this
industrialised country desperately needs. It doesn’t help that former US vice-president
Al Gore has been down here for a beer and a braai and of course waffled about
renewable energy sources – his pet topic. Our sole dependable source of economically
effective power for many years is going to be coal with small and possibly
growing contributions from nuclear and gas. In the unlikely event that Africa
becomes economically and politically mature and stable, hydro power from the
centre of the continent is also a possibility, Wind and sun are ideas to amuse
the scientists but wont bother engineers who have demanding customers.
The government took time off from
compiling their electoral list of unappealing, woefully ignorant, generally
untalented and frequently corrupt buddies to push through another piece of
dreadfully inimical mining legislation. The argument of who wins and who loses
will rage on but once again, grappling with government interference diverts
energy away from doing what is already a very high risk business of exploring
and exploiting minerals. The minister was pleased to tell parliament that
investors she had addressed recently had accepted the reasons for the new
legislation. It turns out however that she was speaking in Canada at the
time.
I would have thought that compressed
natural gas is a fairly inflammable commodity and not something you want
leaking out at a motor vehicle accident scene. Nonetheless some entrepreneurs
are setting out to convince a large number of minibus taxi owners to convert
their vehicles to run on the stuff, and have already commissioned a service
station to sell it. The major attraction is the price of the fuel which is
several rands per litre cheaper than petrol although nowhere in the reports of
the venture is there any mention of fuel consumption and engine performance.
Taxi drivers are unlikely to want to use any fuel which does not get their
fares down the emergency lane at any speed less than 100kph.
Fantastic. Grand Prix season starts this
weekend and there are all the new cars and teams to get used to. I can’t
however get used to losing to the Aussies at cricket even if it is a ridiculous
pyjama game of just 14 overs.. The good news is that there is no rain expected
at Centurion for the final game this evening.
James Greener
One day before the Ides of March 2014
