Short Note 12 April 2017
Everyday carry on
There is the daily shock of yet another political Zuma event, some with major fallout, such as the cabinet reshuffle, the junk rating, the confidence loss and what possibly could follow. Or a depressing data release, like manufacturing output decline in Feb, making for two recessionary quarter declines in a row.
But there is also the other reality, even as you glance through the news media, hit the highway, get around the larger cities, in fact the country. Every day life carries on very much as is.
That either suggests that the shock news isn't as devastating for the greater system as supposed, even given time. Or that denial rules in many corners, people keep carrying on as before even as subtle (and unsubtle) things have changed, causing major changes ahead.
Most people apparently don't live in the future and are not preoccupied by what pillar has been devastated now, or the unsettling deeper truths about some (many) of our fellow travelers. There may be growing unease, yet we carry on. Hope is a funny thing.
That helps to keep society and the economy on the road on a daily basis, but can create a sense of unreality, too. Because there isn't a devastating blow up overnight (the Rand at 30, real purchasing power declining by 20% per year, wholesale overseas migration and emptying of cities, devastation of property prices as happened in 1961, collapse of the JSE stock market as in 1969, large scale job losses), it somehow isn't happening in our innards today with future consequences.
A leaking ship with pumps failing is still sinking, even though it may be barely noticeable from one moment to the next.
And so we come across endless daily commentary about what is going wrong politically and economically. But we see also lots of evidence of this being ignored, of people carrying on as if nothing untoward has really taken place, with real consequences in time. Indeed, commenting that this, that or the other thing may be improving, or is a buy.
That makes for confusion, one of the more oft expressions I am hearing. With respect, there is nothing confusing about what is happening deep inside our innards. But there is not more blood than usual running in our streets, it is all mere words, and many carry on regardless (though some giving protests a wide berth, with rumours of singling out certain vehicles for stone throwing, an excuse I ran across last Friday).
Looking through the fog of war isn't given to everyone, as otherwise all troops might panic prematurely. Stay in your foxhole. Just keep digging, in case you have nothing better to think off. And pray it won't rain. Keep it simple.
Bruggemans & Associates, Consulting Economists