Economy
We need guidance? “A developmental state does not necessarily mean higher levels of state ownership, but high levels of guidance.” IDC and SA Development Bank chairman, Enoch Godongwana.
Eskom: whilst SAA tends to attract more attention, the total debt accumulated by Eskom, and its importance to our economy, overshadows the former by far. News ex Eskom is that the unbundling deadlines will only be met some two years hence. An interesting development is Solidarity challenging the PIC plans to use government pension funds to fund Eskom. The first question that comes to mind is to what extent the GEPF and PIC Trustees are truly independent?
The ministerial hijack of the SAA business rescue, promises an almost-new phoenix SAA rising from the ashes of the old: if former employees and leaders are retained, I have little doubt that the bad habits of yore will be carried forward. I probably do not fully understand this but for a new airline (comprising government and a partner– who would be that stupid?) to purchase the shares of the old airline does not really make much sense. If you are bringing in a partner, why not simply give that partner shares in the existing company? Unless the new company wished to isolate itself from the old company going down. If this is the case, then you have a new partner taking on little, risk…
Abstruse (and boring) but usable: the World Bank has published a paper on the winners and losers from CV 19; if this interests you – page 24. Reference
An interesting remark, made by a radio analyst, was that the almost full recovery of our stock market, might be precipitate as the full economic effect of the CV 19 lockdown is yet to be felt. If he is right, your pension is still not safe.
Business
Our CEF is reportedly in talks with Gazprombank; facilitated by arms-deal-fixer Fana Hlonwana. Aside from the commission, which surely must be substantial even for that loyalist, one wonders why the CEF cannot do this itself?
Snippets:
Raubex reports an unprecedented increase in road construction/rehabilitation tenders being put out (R25bn). Asking for tenders means little – shaya tafel.
FNB has dropped all fees for cash withdrawn at partner retailers from 1 July. If, however, you draw cash at its ATMs, that fee is up by 5%: R2 per R100 over R2k.
PSG has rewarded its executives with packages described as eye-wateringly generous, inappropriate, and undeserved.
The UP has set up an SMME support portal: Reference
At last an investor with foresight and b@lls: Gryphon Prudential Fund had encashed its holdings into the money market in 2018 and is set to make a killing. Its shares are up by 17.8% over lockdown!
In the same breath, Capitec is in hot water for executives having traded off-market; Sygnia similarly for questionable
Hear no evil? The double negative in Afrikaans is negative, the double negative in English is positive: Minister Creecy says that she has had no communication from Eskom that it will not install flue-gas desulphurisation systems at Medupi. One of the conditions of a 2010 World Bank loan of $3.75bn to Eskom was that it would install such systems across all 6 units. Jip; expect it soon!
BS sales and a homegrown triple negative: disinfection tunnels don’t, not only not work, but are bad for you. You must love fellows who sell a disinfectant system that works on anything, including your dog. Yet, believe it or not, businesses have bought this…
Catchphrases are fantastic: our school curricula have been realigned to compensate for lost schooling days. Kudos to Ms Motshekga.
Axa, a Schengen-based insurer, has been ordered by a Paris court to pay a restaurant owner for a CV19- related revenue loss. I have had two frantic communications from my insurer explaining that no cover be given for CV19 losses unless, of course you buy some more insurance. Expect a frantic re-look at policies.
Property
Pam Golding are reportedly restructuring. A contraction in the affairs of estate agents is not unexpected. Unexpected but predictable (when one thinks of it) is civil servants entering the property market. Think of it – civil servants experienced no pay reductions and with the interest rate dropping, coupled with a drop in property prices, can buy much more for the same buck than 6 months ago: a R1m house used to require a monthly income of R32k from the purchaser – that income requirement, at our current interest rate, is now R26k. And the same house is probably cheaper than it was then.
An interesting question to consider is whether buy-to-let properties might not become more popular, with a shift to rentals, by those who cannot afford properties. For those in the reasonable financial health, however, you can probably buy a house now for a lower instalment than that it costs to rent the same house.
Banks are reportedly asking 5 – 10% deposits before lending.
An issue, gleefully reported on by those who-told-them-so, is the KZN land reform having gone pear-shaped (wonderfully described as agrarian regression): more than half of the 1283 farms, bought for land reform purposes, have seen the businesses conducted thereon, collapse. There is much talk of financing mechanisms, but the truth of the matter is this: those placed on such farms were often inexperienced and underfunded. Whilst undoubtedly a massive waste of money, the fact is that these schemes must be made to work for political reasons which affect us all. Land reform is not as prominent as before, but will certainly not go away as political issue.
Practice
The Child Justice Amendment Act has been signed into law. This act deals with the age of criminal capacity and the factors that the state must consider when prosecuting young persons.
The following article is interesting in that the author questions the authority of the High Court to meru moto make deductions, which have not been pleaded, in relation to a section 2A application of the Wills Act; for specialists only. Reference
The JSC had, in 2013, recommended that a tribunal be set up to investigate judge Hlope over a complaint against him lodged in 2008: he has, over the years, attracted further contention. The 2008 complaint will be heard by the JSC later this year. Whatever the right or wrong of this – failure to deal with such issues expeditiously, does no one, especially the JSC, any favours.
Of the roil following on the striking down of certain lockdown regulations, the only one that one instinctively trusts, is that by Ms Madonsela – who commented that she would be surprised if the judgement survives, Concourt scrutiny. The state intends to appeal, and I have little doubt that by the time that the gedoente is settled, the issue will be moot.
Two new deputy-NDPP heads have been appointed: I confess that I have been disappointed by the apparent lack of prosecutions after the appointment of advocate Batoli as NDPP boss. One hopes that these appointments will assist.
Politicsweb published a series of five essays on crime and punishment. The content of these are summarised in a final instalment, of which the reference follows below. The conclusions drawn are quite striking:
our gaols hold 116,000 sentenced offenders and 45,000 un-sentenced inmates;
we have 52,000 parolees and 16,000 probationers;
the NPA and courts are efficient in dealing with run-of-the-mill crime – the exception being corruption;
the key constraint on the functioning of the criminal justice system is police detection capacity.
Reference
Swings and roundabouts: conveyancing fees work on a sliding scale. The more expensive the property, the higher the fee. Bottom-end transfers produce less income than the cost incurred in dealing with them. The idea is therefore that the rich guys finance the poor guys. What upsets this balance, is that virtually every purchaser these days, asks for a discount on middle and top-end transactions. The result of this is that lani firms will refuse to do bottom-end transfers at the suggested tariff. This has tended to push bottom-end transfers to beginner practitioners who undertake such work of necessity. Many of these are difficult and time-consuming, especially grandfather-black-estate, owing to the passage of time, changes in marriage law, children born out of wedlock and missing relatives. To make matters worse, poorer clients must scrape together the cost, leading to delays, and because of inexperienced do not appreciate the legal niceties involved. Hardly the place for a beginner to cut his teeth. Whatever the merits of the old system of black inheritance, whereby a commissioner would hold a family meeting and anoint someone as heir, giving a certificate to that effect which would serve as proof of all, is sorely missed.
Can an order of court be rescinded based on fraud or justus error? Take a look: Reference
Two cases ex STBB:
the duty to provide lateral support to a neighbour’s land in urban areas is strict; Reference
the following case, involving a lack of proper description of an exclusive use area in a share block scheme, which had, in the interim, been swapped for another, is indicative of the gemors that can ensue when the formalities attendant on property transactions are not properly followed; Reference
Quotables
Man is an animal that makes bargains: nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog.
Adam Smith
I continue to watch with morbid fascination as a once-civilized world buckles under the collective weight of ignorance, stupidity and greed which along with twitter (another great work of Satan) may turn out to be the real four horsemen of the apocalypse.
Harrison
America is burning. But that’s how forests grow.
Massachusetts Attorney General, Healy
Comment
The first quote above is drawn from a Ted-Talk: When Ideas Have S*x. The speaker postulates that human progress is developed by sharing ideas, not intelligence. In academic terms, one would describe this as standing on the shoulders of others – a few extracts from the talk is interesting to note:
trade is ten times older than agriculture;
the motivation for this talk is an essay written by Lawrence Reed, entitled I, Pencil which demonstrates that we need to cooperate in order to produce anything, in this case, the collective effort that goes into the manufacture of something as simple as a pencil. Reference
To make the following reference acceptable to automated thought-police, I had to remove the e in the text: do insert this and look. Reference
As regards the third quote above; I was watching footage of the anti-Vietnam war demonstrations during Nixon’s reign – then thought of as outrageous, but altogether much less violent than the current Floyd-induced upheavals in American society. Police were quite heavy-handed then, considering the quite peaceful nature of the protests. These protests were enough to turn the tide on that military adventure. The latter-day Trump narrowly squeaked into power, and the tone of today’s protests may well be indicative of his small margin of approval having disappeared. Yes!
Guided by science – hell no! Our government is not the only which chooses science as its reason for doing this or that. Yet it is selective about the science to follow and elects to follow that science only when it suits: witness the adoption of lockdown and the advice of epidemiologists with nary an economist in sight and, lately, the failure to follow recommendations for a descent to level I lockdown.
Nevertheless, lockdown may well have been preferable to less invasive solutions: the much-lauded “responsible” take on prevention adopted by the Swedes, is now being questioned.
The difficulty here is not our overarching response to the pandemic, but the exposure of the staggering ineptitude and irrationality of many of the cadres (chosen for party allegiance rather than ability) who govern us.
Cost BS? We are fighting a life and death war – cost is not the issue here. Ramaphosa
Really? Ask any state cancer patient whether cost has been an issue in treating him – the fact is that our funding gap has cost and will cost a great many lives.
More BS: “Lockdown has presented indigenous people the opportunity to be self-sufficient and produce their own goods.” KZN MEC for Economic Development
Clearly, indigenous people should be thankful for the advent of the CV 19 pandemic.
