Daan Steenkamp's Snippets

News:

Who said law could not be fun?

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Hard news:

  • The following judgement, sent to me, courtesy of STBB, deals with the jurisdiction of the sectional title Ombud and is worth a read for property practitioners: http://www.saflii.org/za/cases/ZAWCHC/2021/132.html
  • I hold an SCA judgement in Tshepe v Rustia (not yet reported on Saflii) in which the SCA struck down a surety which was immersed in other text – make sure that sureties are brought to the attention of those who sign. Ask me for a copy.

Economy

Those in the know say that our Rand, at its current US dollar exchange rate, is now fairly valued. If one accepts the Big Mac Index, the real value of the rand should be at about R5.93/US $. That index says that ours is the third most undervalued currency. You must love this, PhD work evaluated using a meat patty in a bun.

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Our debate, three weeks ago, on the lowering of our inflation target, is all but forgotten in the wake of the excitement just past. Three weeks ago, the lowering of its inflation target by the Reserve Bank sounded like a great idea as it would have brought us closer to the inflation rate of our trading partners. Business Day has published a note saying that inflation is picking up in the UK, by way of example, might reach 4% in that country. If this trend persists, lowering our inflation target will not happen.

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The fallout from the civil unrest continues unabated. Scapegoats are sought and arrested. Reasons are given and solutions are offered by all and sundry. There is suddenly concern about our losing our status as gateway to Africa especially in the sense of serving as point of entry for goods. In this respect some 200 truck drivers have been killed in recent years, ostensibly owing to the xenophobic perception that they take work from locals. As we speak, there are negotiations behind-the-scenes with our government to provide compensation for these actions of our would-be driving community. Yes, this is who we are. The fact is that goods will find their way inland via other ports and points of entry if we cannot give an assurance that truck drivers will be safe.

The solutions offered to our status as investment destination and, indeed, cures for our ailing economy, has and will undoubtedly go unheeded. Our Pres’/state’s knee-jerk reaction is ancient: Panem et circenses – bread and games – introduced by Roman government by providing food and entertainment, in order that the poor would be less likely to revolt. Suddenly BIG (basic income grant) is news – for the same reason – sold as because the government cares. Whatever the sales pitch, this is Robin Hood economics at play rather than a genuine attempt to fix the underlying problem. BIG is also indicative of the Prez going to the root of the problem – poverty, and not the fanciful theories of the overthrow of governance and so. Affordability is forgotten in the face of social unrest.

Private sector advice, such as that offered by the IRR, which addresses the underlying issues, cannot possibly be sold to our population, given the political mindset of those who govern us: that advice comprising –

• Protect property rights;

• End all race-based policies; and

• Implement Economic Empowerment for the Disadvantaged.

I was sent an article written in The Economist by SWKE – in order to read this you will have to provide an email address but, this is how the world sees us:  https://www.economist.com/leaders/2021/07/24/end-of-the-line-for-anc-economics

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Warren Buffett reputedly said that only when the tide goes out you discover who’s been swimming naked. The fact is that our government swam naked and has been found out – we are on our own.

Business

Given the third CV19 wave cresting, the Prez has lifted the restriction on the sale of alcohol: great, I have no doubt at all that it’ll bring more peace to South Africa than will political promises.

On that topic: what happens, taxwise, when Sasria pays you out for lost stock? https://www.moneyweb.co.za/mymoney/moneyweb-tax/tax-implications-arising-from-the-devastating-insurrection-and-carnage/

Last week I had noted that Sasria held R7bn in funds and the latest estimate of the damage caused is R40bn. Our government says that it will bail out this insurer. On being paid: Sasria has said that it would pay out quickly – the question is how long the government will take to pay Sasria the expected shortfall.

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On the topic of rebuilding: government has promised to assist us to rebuild our business: the Prez gave a few details. Buy construction shares!

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So, you pick up a dispute with SARS – in fact last year some 12% of those assessed for tax, objected. This rate is higher than the international norm and SARS has committed itself to bringing its rate of disputes to within “appropriate norms”. Much of the unpleasantness is attributable to what is politely referred to as a loss of expertise and a somewhat less than satisfactory eFiling system.

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Poverty is one of the reasons that has been punted as contributing to the mayhem of two weeks ago. Looking at the causes of poverty and societal health I came across a somewhat disturbing article on societal policies, overpopulation, and scarcity of natural resources. If these guys are right, then what has happened will certainly occur again in future. Do look: https://www.livescience.com/collapse-human-society-limits-to-growth.html?

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 Shorts:

  • Stats SA says that our population has grown by half a million people just over the past year.
  • Do politicians interfere in your business? The EFF got a snotklap doing just this: https://www.golegal.co.za/labour-court-judgment-restraining-eff/
  • More talk: Mbalula promised a final announcement on the details of how e-tolls will be dealt with, not only for Gauteng, but for the whole country, after 19 July. Don’t hold your breath.
  • Eleksa will be bringing a R200k electric car, named the CityBug, into South Africa by September.
  • Osina has discovered more gold in the vicinity of Twin Hills in Namibia.

Property

Steep municipal services/rates hikes are predicted to push consumers into energy-saving solutions. The prediction is further that houses will become more compact. Yes, we are on our own.

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Understandably, mall owning Reits are being dumped by investors.

Where to from here in the commercial property sector? The writer of the article, that you are referred to at the end hereof, speaks optimistically of reinventing and reinvigorating our economy – dream on. If you think I’m exaggerating; who in our current government is a thinker – someone who will come up with a solution to the situation that we find ourselves in? https://propertyprofessional.co.za/2021/07/22/post-july-rioting-where-to-from-here-for-commercial-property-sector/

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The government changed the attorneys’ representative body to a regulatory body. Expect the same for the EAAB, which is set to be replaced by the Property Practitioners Act, 2019.

Quotables

How could you say that a judgment is absolutely correct when the judges themselves have different views about it? … There are dissenting judgments. You will find that the dissenting one has more logic than the one that enjoyed the majority. What do you do in that case?

Zuma

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Harvesting “the bitter fruits of a counter-revolutionary insurgency that has long been germinating in the bowels of what we commonly call ‘state capture’.”      

Thabo Mbeki Foundation

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‘….Because of the growth in government taxation, the rise in rent and interest demanded by the landlords and the daily spread of the disasters of war, there are famine and banditry everywhere and the peasant masses and the urban poor can hardly keep alive. Because the schools have no money, many students fear that their education may be interrupted; because production is backward, many graduates have no hope of employment. Once we understand all these contradictions, we shall see in what a desperate situation, in what a chaotic state, China finds herself. We shall also see that the high tide of revolution against the imperialists, the warlords and the landlords is inevitable, and will come very soon. All China is littered with dry faggots which will soon be aflame. The saying, “A single spark can start a prairie fire”, is an apt description of how the current situation will develop. We need only look at the strikes by the workers, the uprisings by the peasants, the mutinies of soldiers and the strikes of students which are developing in many places to see that it cannot be long before a “spark” kindles “a prairie fire”.’

Mao Tse Tung (quoted by Cronje)

Comment

One of the lodestars of our revolution is Cuba. Interestingly, Cuba is as bereft of solutions, for similar problems to ours, as we are. This has become apparent following on what is referred to as the biggest Cuban public protests in decades, driven by sanctions, economic curtailments caused by CV19, and generally poverty. The government says that it has tried to protect the vulnerable, but that its capacity to do so has been eroded. Sound familiar?

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Apparently, one in every two learners worldwide, receive school meals every day. We are supposed to feed some 9m schoolchildren (that is 15% of our population) at school daily, but more than half do not receive these meals. I had suggested above that we should possibly reduce our birth-rate/population. The fact is that we have children going hungry daily, a situation which does not auger well for the future.

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WT*! Given our dire financial and social situation, one would think that our ministers would focus on solving these. Yet we get earnest nonsense like this from them:

  • During the looting, children dependent on formula milk/food went hungry, and their mothers used social media to source food for them. Now our Department of Health says that infant formula donations should not be made otherwise than via that department, as donations and the distribution of infant formula, are not in accordance with the law. If this nonsense were to be accepted, many children would be dead by now.
  • Much food was looted from warehouses and the like. The Ethekwini municipality has warned looters against the consumption and sale of meat and poultry liberated from the Hammardale warehouses, as the meat stolen was not stored and transported at the correct temperatures and may prove detrimental to their health.

Lighten up

We hang the petty thieves and appoint the great ones to public office. Aesop.

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Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. Oscar Ameringer.

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Politics is supposed to be the second oldest profession. I have come to realize that it bears a very close resemblance to the first. Ronald Reagan.

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Contributed by:
Daan Steenkamp Attorneys
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