- Well well well, the Rand has indeed come storming back from its Friday/Monday tantrum. I must say its resilience is rather remarkable. Currently its manic personality is on display.
- There are however two rather important events today that may determine its short term trend confirmation and/or reversal.
- The first is the release of USA inflation later today. Global Inflation, as you know, has become the biggest single immediate concern for the macro environment.
- Potential runaway inflation is of concern for Central Bankers across the world, and for financial markets in general.
- If interest rates need to rise faster than anticipated to combat the scourge of inflation (created by the very same Central Bankers), it could have serious implications for Financial Markets across the globe, including currency regimes.
- The second event is our own SONA address by the President tonight.
- In reality it should really be a rather short speech – “Apologies, but we have managed to break everything, please be patient whilst we try to restore normal service”
- Jokes aside – the President has a lot to deal with, because the Country continues down the very slippery slope of self-implosion.
- Energy, security, Fiscal problems, service delivery, unemployment, poverty, health, education, crime, social cohesion……..it’s a rather extensive list of problems that need to be addressed, especially when the cheque book is running out of cashable cheques. We already have to keep postdating them to longer points along the yield curve.
- So please Mr President – no talks of smart cities and flying cars and self-driving trains. For now we will be happy to just have the pot holes filled in properly. No talk of how Government is serious about corruption. Over the last few years, Joe Public has seen just how serious you are, you have become experts.
- We need a cohesive plan, we require action. We don’t need flowery speeches….South Africa is fast running out of road. Perhaps a good start would be a cabinet reshuffle, and perhaps even implement the score cards for ministers. After all you did promise to do that 4 years ago.
- Don’t promise that Government will create jobs – Government can’t do that. You can however create the environment that will attract investment, thereby creating jobs…anyway enough of that. My blood pressure is already unstable.
- I have a choice tonight. I have a meeting to attend, or watch Sona, or watch Liverpool …….guess which two things I will be doing.
- Today’s events may or may not determine whether the Rand is depressed tomorrow, or alternatively whether it remains Euphoric.
- I do know that if I watched SONA tonight, I may require some medication to control my anger.
- My advice is to find something else to do – read the headlines later.