Thanks probably to the developments in
European markets (see below) a somewhat selective bull has returned to the JSE
and the All Share index has nosed back over 52 000. The week’s batch of company
reports were rather mixed in fortune and outlook suggesting that this is not a
tide that is raising all ships equally. Not an easy market to buy. Mind you, it
rarely is.
The folk running the finances of Europe are desperately fighting a battle against the
wrong enemy. This week they cut interest rates for the euro even further in the
near helpless attempt to get the citizens of that awkward and unhappy union to
borrow and spend money. For at least a
decade and probably far longer, however, this method for stimulating economies
has not been working. It would appear that the category of people who in the
past might have been inclined to go into debt and also accept the obligation to
repay that debt, currently have little interest in playing that game. Instead
their feelings of prosperity and security are being overwhelmed by the
impression that their governments are ceaselessly growing pools of
self-enriching bureaucrats pursuing policies of entitlement and distribution.
The popular but obviously unsustainable
belief that the many can be supported by the efforts of the few may be nearing
its long overdue exposure as a lie. Hastening the arrival of this point are the
baffling displays of disdain and animosity shown by a very unpleasant cohort of
the beneficiaries towards their benefactors and their beliefs, faiths and customs.
This disturbing and very unsettling development must surely be a factor in
deepening the reluctance of the true wealth creators to play the roles that are
being scripted for them by the leaders.
From Washington
to Pretoria we
are hearing another chorus of howls about how unpatriotic (but note, not
illegal) it is for businesses to arrange their affairs to minimise tax. People
who feel that citizens need to be “punished” for choosing business practices
that maximise the value added simply don’t understand how economies work. A
century or two of democracy and civilisation have created way too much
legislation and far too many legislators. Growth will come not from tampering
with interest rates but by reversing the growth in numbers of tax eaters
compared to the number of tax payers. The pruning process needs to start with
all those who have assumed the powers of price setting of everything from money
to labour, for these are the most lethal and expensive of that group. Surely we
now have ample laws on the statute books and need just to enforce them fairly
and swiftly? And of course discard those that are needless.
Trying to get his voice heard in the same
corridors of power where this week’s non-coup of Lesotho was getting attention
was King Buyelekhaya Dalindeyebo of the AbaThembu who fears that his Certificate
of Recognition is about to be cancelled. Is there really a department of
layabouts who issue these things? Are they like a drivers licence requiring
regular renewal after passing a test of sovereignty? What benefits and powers
accrue to the holder? Is there a monthly stipend which can be collected by
joining the queues of pensioners and mothers on the 1st of the
month? And at the now infamous and salacious reed dance ceremony, another king in
the region selected his 16th wife (a teenager) from the throng of
swaying maidens.
The JSE are to be congratulated and
admired for yet again nailing down the award for running the best and safest
stock market in the world.
There is something underwhelming about these
triangular cricket tournaments – unless and until one’s side is winning I
suppose. Beating the Aussies is always good. I am not sure if I have the
courage to watch the ‘bokke face the Wallabies in Perth tomorrow. On recent evidence we should
do OK as long as we don’t have to scrum, take part in line-outs or pass the
ball too often. The Sharks too seem to wobbling a bit of late so perhaps this
is not the right time to draw attention to the fact that the Lions are top of
the Currie Cup log.
James Greener
5th September 2014
