There is really nothing special about 50
000. It’s just a nice round number, easy to remember but now covered in dust as
the All Share index raced past it this week. Where this index is going is
impossible to say. From the weakness of the rand, however, it seems safe to say
that the buying pressure is locally based. Foreigners have seen something that
scares them and presently are drifting off elsewhere.
Maybe they too are worried by the
increasing anti-market sentiment and regulation that seems to have ratcheted up
a notch in our poor and battling country. The truly dreadful problem that the
economy is shrinking (but not yet in a recession apparently – thanks to a
technical definition) should be ringing very loud alarm bells. Instead the
government is stubbornly doing more of what its own experience has shown does
not work. That is to impose more and deeper controls on how we should go about
our lives. For example the unsympathetic and unyielding application of
tightened visa regulations does nothing to encourage talented folk to come and
help us but it provides great material with which the internet chatterers to deride
us.
Mind you, when it come to interfering,
plenty of other places are just as foolish as we are. Yesterday the suits at
the European Central Bank announced a negative interest rate. This means that
certain deposits made with that bank will be returned with the interest
deducted from the principal. The idea is that this will encourage people to
spend money rather than to save it. This utterly ignores the fact that obviously
many people in Europe have decided that they
don’t wish to do that right now.
Back home, however, the worst kept secret
is that the Reserve Bank feels that further interest rate hikes are inevitable.
For savers this is good news. But the reports from companies which try to make
a profit by lending money to individuals confirm that borrowers are experiencing
serious difficulties in servicing their debts. Instead of backing off and
letting the buyers and sellers of goods, services and labour reach their own
levels of prices, be assured that the state will wade in and create further
unrealistic expectations of entitlement. Growth and general prosperity can not
flourish when at every stage of commerce and industry an inexperienced and
usually woefully unskilled government satrap insists on telling everyone what
to do.
Although the methodology used by the
international agency that ranked our education system as one of the worst in
the world is surprisingly indirect there is no quibble that it fails to enable
our population to compete in the new high tech global economy. Even or perhaps
especially at cabinet level there is scant grasp of how the country’s woefully
inadequate internet connectivity is holding us all back. A president who
battles with large numbers will never understand why accessing petabytes of
data in microseconds is important.
The annoying rustling noise that you can
hear coming from the Western Cape
is not just the drumming of rain on the tar paper shelters of the unfortunate
evictees who foolishly chose state land to squat on. Mostly it is the sound of
dozens of new parliamentary denizens flipping delightedly through their
ministerial handbooks (Original Complete Edition). Slowly the immense joys and
benefits of having first call on the public purse are sinking in. “So many
perks”, “And look, they will last even into my retirement!” “Why didn’t I get
aboard this gravy train so much sooner?” “That new Finance Minister Nene fellow
must be mad if he thinks I should exercise restraint.” “This is a life time
opportunity.” Adding to this happy hum
is the noise of breaking promises and high grade hypocrisy. The leader of the
Economic Freedom Fighters took less than a day to flee his high principled insistence
that public servants must use public health and education services. His son
continues to enjoy private school education.
The most unrewarding job in world sport
must be the post of coach to the South African national soccer side. SAFA must
be talking serious money if there are any candidates to replace the hapless
Gordon Igesund. Compared to that, coaching even the Stormers must be fun.
James Greener
D-Day 70th Anniversary
