Policy Uncertainty Index

 

If there is one thing the markets hate, it’s uncertainty.  And if there is one thing the ZA government is good at, it is inflicting uncertainty on us.

So it is good that our chum Professor Raymond Parsons and his team at NW University have come up with a new Policy Uncertainty Index for ZA.

While the launch this week was a bit underwhelming, with too much focus on methodology and too little on the actual findings for Q4 2015, we can only hope that this becomes a valuable tool for those responsible for all the uncertainty, as well as those who are trying to make sense of what is happening in ZA.

The events late last year, when President Zuma changed his Finance Ministers more often than he changed his socks gave the markets a scare, hit the rand, and arguably led to the latest painful jump in interest rates.   While we appreciate this is good for savers, most of us are borrowers, and we are going to hurt.

As with most indicators, the trend can be very important, so while it is worrying that the index jumped from its base level in Q4, it will be interesting to see whether any stability is being achieved in the wake of the return of Pravin Gordhan to the Treasury when the next data are released.   The budget on the 24th should give a reasonable indication of whether he is going to open the floodgates of spending and borrowing, to appease disgruntled ANC supporters, or whether prudence will reign – which might help us avoid a further ratings downgrade to junk, or dog poo, or whatever is used for economies where the fan is turning a nasty brown colour.

It would be sad to think that spreading policy uncertainty is one of the few things our political leaders are good at.

OUTA

We have discussed in the past the importance of OUTA, which began as an anti-toll movement, but is evolving into a wider advocacy movement against unjust taxes and corruption.  ZA Confidential visited the OUTA offices this week, and was impressed by the clarity of thought and commitment of OUTA leader Wayne Duvenage.   A media briefing is being planned later this month to give some insight into the methodology and strategy of the movement, which seems to be attracting growing support and will hopefully be able to match this with sustainable funding.

 

Tweet of the Day:

Shit Jokes (@ShitJokes):  Last night I tried wife swapping for the first time, it’s brilliant!! I managed to get a new lawnmower for mine.

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Don’t get me wrong.  Today’s South Africa is a far more pleasant place in which to live for the majority of its people than it was in the evil past, when they were third-class citizens, without basic human rights, such as the right to vote.  However, this does not mean that the ANC, which many annoyingly refer to as the “ruling” party, should not be open to criticism, debate and challenge.

At a time when we have the most unpopular post-apartheid President, in Jacob Zuma, I believe that there are encouraging signs.

The DA remains the most potent opposition party, and with its control of the Western Cape it is showing us just how awful the cadre-corrupted ANC is at basic administration.  However, the EFF, with its overall and beret uniform and ability to speak to the ordinary citizen, is a powerful force – despite its apparent economic illiteracy.   Parliament is just what it is meant to be, at long last, a place where interesting and important issues are aired and the leaders are challenged.  Of course, we don’t want chaos all the time, but it is reassuring to see one group of parliamentarians which is not prepared to accept the stuffy and repressive rules of the past.

Organised business remains horribly disorganised, not helped by the breakaway movement of black businessmen who have every right to want to see a more even distribution of races in the business community, but whose strategy seems to leave others feeling a bit uncomfortable.

It was interesting to see the reports of the role which some of our top bankers played when President Zuma was playing musical chairs with his Finance Ministers, and if these reports are to be believed, they saved the day by ensuring the respected – but far from perfect – Pravin Gordhan was parachuted in to try to sort out the mess.     Of course, one should not ignore, either, the (weakening) voice of the Trades Unions, not the cries of civil society.

However, a true democracy requires that there is a voice for all, and that is why I delight in the emergence of a movement of citizens in the anti-toll road movement, under the banner of OUTA.  While this campaign may not fully overturn these horrible taxes imposed on Gauteng citizens as they drive along our highways, OUTA has caused several climbdowns, resulting in a far lower burden than first imposed.  And there are millions of people who have been inspired and encouraged by OUTA, headed by the impressive Wayne Duvenage, and are refusing to pay their tolls.   If you want a true example of people power in South Arica, here it is.

At the time when Zuma was changing Finance Ministers almost as often as he changed his underwear, OUTA appeared to be widening its message, with a warning that government might face a general tax revolt – and not just over motorway tolls.

Of course, OUTA is under-funded and under-resourced, but wouldn’t it be wonderful if it could move from the advocacy arena into the mainstream political arena in a more sustainable manner?   It has shown itself to superbly articulate the rights of citizens in a more united and uniting way than most existing political parties.

An OUTA parliamentary candidate?  She (or he) would certainly get my vote.

 

Tweet of the Day:

Jewish Comedians (@JewishComedians):  Lewis Black: Earth Day was created by my generation b/c we were doing so much drugs we needed a day to remind us what planet we lived on.

 

ZA Confidential is a subscription newsletter.   To join the elite, to invite us to events with edible food and drinkable wine, for sponsorship discussions or any other communication, please contact:    zaconfidential@gmail.com    

Follow us on twitter:  @zaconfidential @dievinein @clasfras1    

Chris Hart

I am extremely proud of my friendship with economist and strategist Chris Hart, who is one of the most impressive thinkers I have ever known.  I edited the book he and colleague Glenn Silverman wrote on the BRICS, and last year spent many days working alongside them.  I am worried at the backlash against one of the tweets Chris put out.  While it may have been poorly worded, any suggestion that Chris is a racist or intended to be racially offensive is quite ludicrous, and he has apologised for any offence which he may have inadvertently caused.   The subsequent eruption of hatred against Chris is a symptom of the very deep wounds in South Africa which have yet to heal.  We have a society which still bears the scars of apartheid, and where many millions have failed to enjoy a better economic future since the advent of democracy.

I also have to declare that I have endured a difficult relationship with Standard Bank, which has sometimes treated me fairly, but which has also been puzzling unresponsive to my more recent requests to be kept up to date, in breach of personal assurances by CEO Sim Tshabalala.

But I assume my own discomfort is nothing compared to that of Chris, who was suspended following his tweets, and suffered the indignity of his employer publicly distancing itself from him.    This was a knee-jerk reaction, although one would have expected a top bank to act with caution, with judgement and with fairness.   In this instance you were sub-standard, Standard.  I have no idea how many of their customers have been in touch to seek an explanation of their betrayal of Chris, but I hope there have been many.    The career and reputation of a fine and sensitive man has been irreparably damaged and his employers have failed in their duty of care.

Meanwhile a totally false and further damaging public discussion is taking place on Chris’ academic qualifications.  If course, had he lied while he was negotiating his latest move to Standard Bank, that would be a serious matter.  I really doubt it.  A caring employer would by now have put out a statement assuring people that Chris acted honestly and with integrity, and that he was hired because of his obvious and impressive analytical and communications skills.   Standard Bank has once again acted in an odious manner, and is, for me, the real villain in the current saga.  Unless, of course, they have put out a statement on Chris’ credentials, and have once again forgotten to send it to ZA Confidential as well.

The Economy in 2016

As we prepare for a return to crowded rush-hour roads and our kids head off for another year of schooling, which will prepare them so efficiently for a life of unemployment, it is worth wondering what 2016 will bring.   Over the past few weeks, I have been lucky enough to have chats with a number of esteemed economists, all of whom are a bit worried about the South African economy, and not all of whom have been suspended.   The consensus seems to be that there will be sustained pressure on the rand, which will weaken further, and that this will lead to higher inflation and hikes in interest rates.   It will be difficult for South Africa to avoid further ratings downgrades, which will speed up this negative spiral.   There are all sorts of political undercurrents battering the economy, and these may increase the danger of tax increases in next month’s budget.   Last month’s musical chairs in the finance ministry will not have helped matters.   Meanwhile, there are tensions with the US, which may explain the failure to conclude AGOA negotiations on time, and consistent concern that SA business has yet to find a firm voice in its dealings with our wayward politicians.

ZA Confidential Introduces Animalia.

ZA Confidential was launched as a business newsletter, but is evolving.  One issue which no progressive business can afford to brush aside is that of Sustainability.   And we are now part of a new initiative being launched, called Animalia.

There is something very tragic about the way in which man has become such a menace to wildlife, through the destruction of habitat, and by hunting animals not just for food, but also for gain and for sport.  Something needs to be done to inform and to educate before the rhino, the elephant, the panda, and the tiger join the dodo on the list of extinct species. Animalia is part of this initiative.   It is a virtual kingdom, where animals enjoy human rights, are nurtured, protected and loved.   By joining Animalia, people are pledging their support for the wildlife on our planet, and taking a stance against the hunters, the poachers and all other humans who are threatening our fellow creatures.    Animalia was founded in South Africa by the Fraser brothers, but will grow to become a global movement.  This Kingdom will seek new platforms to promote its message, through conferences and publications, its website and an application to join the United Nations

Animalia is a virtual Kingdom, ruled not for man but for the animals.  Anyone with an interest in, and a concern for, wildlife can apply for citizenship.   We will spread the message through news updates and through our website; we will build a comprehensive and authoritative database on wildlife; and we will lobby against the enemies of the animal kingdom.

More information on Animalia will be provided during this launch stage through ZA Confidential.

People often ask how they as individuals can help to make a difference.   Now you know!

 

Out and About

From time to time, ZA Confidential is invited to events, and although we do not always report on them, they add to our understanding of the world, and enable us to meet and greet some fine people.   A few highlights of the last few months are worth recalling.

Tsogo Sun invited us to the re-launch of the Grand West Casino, and added an extra level of luxury by arranging one of those services which drives you and your car home at the end of the evening.  The music was a bit loud, but they have done a good job, the CEO’s speech was mercifully short, and it was a special evening.   The nicest casino I have visited outside of Monte Carlo.

We were also invited to the Stellenbosch at Summer Place gastronomic event where Stellenbosch food and wine were highlighted.  The food was almost universally fiddly and unimpressive, but there was an excellent selection of wines, I loved the brandy, and really enjoyed my evening.

I was also invited (possibly by mistake) to a Standard Bank evening where CEO Sim Tshabalala launched the All From One campaign – an initiative to celebrate our common African heritage.   It was impressively organized, the hospitality was lavish, and there were several interesting and impressive guests.

Wine Update

There is still quite a backlog of the Die Vine Intervention Wine Tasting Podcasts which I host with the legendary Michael Olivier, but we hope to post more of these in the coming weeks.  In the meantime, why not wander through the archives? These are not stuffy and snobbish events, but the aim is to enjoy a lot, learn a bit, and convince people South Africa is a wonderful booze-producing nation, despite the efforts of more than one government ministry to clobber our producers.

Tweet of the Day

ANN7Reporter (@ANN7Reporter): In finance news, we can confirm that the rand can buy you… nothing. Absolutely nothing.

 

ZA Confidential is a subscription newsletter.   To join the elite, to invite us to events with edible food and drinkable wine, for sponsorship discussions or any other communication, please contact:    zaconfidential@gmail.com    

Follow us on twitter:  @zaconfidential @dievinein @clasfras1    

There is a first time for everything.   Despite many decade of journalism and a fascination with electronic toys, I have never before reviewed a smartphone.   I know the geeks among you will pour over specifications, and that you can Google a pretty authoritative assessment at the click of a mouse, but that is not my style.   So it has taken me a while to work out what to say about the Mi 4 from Xiaomi.   On the plus side, this is a device which seems to be on a par with a lot of far more expensive smartphones.  I think the world has gone rather mad when you spend more on a phone than you do on a TV – something I have already done this year.   And, let’s face it, some of us like to own a decent phone while still having enough cash left over for food, drink and merriment.  On the negative side, this is not yet a well-established brand in South Africa, but it is being launched and distributed by the people behind Apple imports and distribution, and they should know a thing or two million about cellphones.   So, before I return the trial device to the mad fools who let me play with it, I shall sum up my thoughts:  If you want a cellphone which does all the good stuff of its far more expensive rivals, and even makes phone calls, then the Mi 4 is well worth considering. The same people make a range of other phones and I believe their tablet devices may soon also reach the South African market.  The Chinese are all the rage in Africa at the moment, as they buy up most of the Continent, so why not give this Chinese phone a try?   Unless you plan not to eat very much for the next 24 months?   One thing is for sure.  The Mi 4 will impress you a lot more than my first ever cellphone review.

 

Tweet of the Day:

Famous-Quote.net (@famousquotenet):  The minute you read something that you can’t understand, you can almost be sure it was drawn up by a lawyer. – Will Rogers

 

ZA Confidential is a subscription newsletter.   For subscription details, to invite us to events with edible food and drinkable wine, or any other communication, please contact:    zaconfidential@gmail.com    

Follow us on twitter:  @zaconfidential @dievinein @clasfras1