The JSE All Share index has caused a great
deal of anxiety with a trading range of more than 8% over the past ten days.
This level of variability tends very quickly to expose the forecasting
shortcomings of the experts who now have to wave their hands more than usual
and talk of things like the VIX, which is a volatility measure in the USA. This
analyst also has a home-grown measure of the potential for the market to
inflict pain on a perennial bull and that measure is currently standing at more
than twice the average level. In simple language it’s scary out there.
On the JSE this morning a single
krugerrand was sold for R16 000.10 which is not far below the record of R16 200
set in November 2012. But unlike then, today’s price is a result of a very sad
rand. For people who value their gold in US dollars, however, today’s price is $800/oz
below the peak. Number 1 who was cutting the ribbon on just one sixth of a
power station (the other five sixths being way behind schedule) seems to have
acknowledged that economically the country is not where it ought to be.
Nevertheless his speech also asked the commercial sector to “look past profit
margins” and employ lots of people. Hopefully someone sidled up to him
afterwards when the tea and cake part of the ceremony was in full swing and
pointed out that only profitable companies pay tax.
The report that the North West Provincial
Government had identified 34 000 employees on its payroll who simply don’t
exist but draw R19bn a year in salaries and benefits was very short on any
other facts. Aside from all the obvious questions and outrage that come to
mind, the effect of terminating this flow into the economy of the poor and
under populated province must surely be catastrophic. That’s of course assuming
that these “ghost” employees are actually going to be fired and have their
names taken off the list.
Even the local newspaper relegated to below
the fold on the front page the news that Durban
had won a competition that no other city chose to enter. The excited group of
citizens pictured celebrating this city’s honour of being appointed host to the
2022 Commonwealth Games all looked to be too young to be tax or ratepayers. The
photographer may have had some difficulty finding them. But enough curmudgeon; it will surely be a
wonderful and exciting event and we can look forward to a long and entertaining
series of the old show called “follow the money” beforehand.
A somewhat whimsical but silly idea that
the ‘bokke need to get their boots dirty
on South African turf before each world Cup match may not find much approval
from the customs people at Heathrow Airport. Firstly the fellows in green and
gold will need to explain that the slab of grass in their luggage is not the
medicinal sort. Then for a nation that decimated the national cattle herd after
an outbreak of foot and mouth disease, the prospect of allowing entry to a
grassy sod from the disease-ridden southern tip of Africa
is unlikely to be a winner. The boys are just going to have to be content
wiping their boots with pictures of Loftus or Newlands. The other rugby story
to raise eyebrows is that the EP Kings players have not been paid and have
threatened not to travel to their away match at Ellis Park this weekend unless
the cash appears. This is just further evidence that the nation really doesn’t
have the necessary resources to have six or probably even five sides in the
Super rugby tournament.
James Greener
Friday 4th September 2015
