ONE OF US IS SUSPENDED AND IT IS NOT ME

Most real trained economists can be distracted for a couple of hours if asked what the price of money (i.e. interest rates) should be. They are amazingly variable over an astonishing wide range, sometimes even falling below zero. Indeed, there are several situations around the globe at the moment where depositors are being charged interest (which surely must be the wrong word) to lend their cash to a borrower! Fake untrained commentators like Tidemarks can’t grasp what this means for the economy of a nation where this takes place. It nevertheless does not seem right. Interestingly the debate about negative interest rates is heating up again as part of a growing discussion about how perhaps administered interest rates having been too low for too long. But the flaw in thesis is that there exist people and committees who know what the correct interest rate must be. And these wise men and women from time to time reset this rate and the nation’s economy surges forward on this wave of intelligence and insight. Um. Almost certainly this is not the case! Throw in the fact that that governments just love to tax interest flows and one has the makings of a complex system for which open transparent markets are the ideal price-setting mechanism. In contrast, the issuing and renewal of driver’s licences should be a cheap and seamless service delivered by technology with minimal human intervention. (Except for the driving test – but watch this space). However, this week, Transport Minister Fikile Mbalula used nearly every cliché in the politicians handbook to describe what will happen. He was excited that the process will in future be “atomised” and the new licence will be redesigned to incorporate and adopt new technologies. such as blockchain and other related technologies which will form the platform of an integrated transport system.” Sadly, he didn’t promise that his staff would “work around the clock” so most likely many of us might not ever receive these new licences. Just before President Cyril became embroiled in the ridiculous play-ground shouting contest with the ANC Secretary General Ace Magashule about who had the bigger mandate to fire the other, he joined a love-in with Finance Minister Tito Mboweni. This duet was about the need for another State Bank. This is such an old and boring song that reappears whenever one of them forgets that they don’t know how banks work. In a series of posts made on social media, the finance minister said that the ‘cry for a state bank is loud, clear and urgent’. The queue of depositors however is short, risk-averse and vanishing. The folk who create the never ending stream of legislation that dribbles out of the corridors of power really don’t have a clue. Neither frankly do many of the commentators who are called in to write about and praise the latest slab of extremely annoying and implausible instructions on how to run a business. In their minds thanks to the glossy TV ads, they see plush offices staffed with crisp efficient laptop-toting meeting attendees smiling and laughing as they devise yet another illegal way to squeeze the clients and customers and make another couple of million before morning tea. The reality, as most of us know, is quite different. Those lucky enough actually to have a job. divide their time between begging clients for orders or payment and telling compliance officers not to interfere in the delicate balances we have crafted in order to keep afloat. A most peculiar story has emerged from the rugby tournament known as the Varsity Shield bubble(?!) now in progress. The team from Walter Sisulu University (with 31 500 students on 4 campuses in the region that used to be known as Border) have been performing the New Zealand “haka” before their matches. Among the reasons they have provided for this choice of a foreign symbol is that they admire the way the All Blacks play. Further they have won 3 world Cups. Errr. Yes. So has another team called the ‘bokke. Anyway, after receiving a polite and kind letter from New Zealand rugby, the WSU fellows have stopped making fools of themselves but to be fair it did seem to work. They beat Rhodes 63-10. James Greener Friday 7th May 2021