South Africa, as an emerging market, is probably not in a position to begin “quantitative easing”. To be honest, there is an element of discrimination at play here. When the European Central Bank or the Bank of Japan embark on such a path, it is labelled “quantitative easing”. When a developing economy tries something similar, it is seen as printing money, pure and simple – the last resort of a banana republic. That may not be entirely fair, but there you go.
Politically, this is all a transparent proxy conflict between President Cyril Ramaphosa’s supporters and those from the camp of disgraced former president Jacob Zuma. But there is an area of monetary policy that involves easing that has wider political support, does not involve changing the SARB’s mandate, and would probably give the economy at least some of the stimulus it needs without reigniting inflation.
This gives the Reserve Bank plenty of room to cut rates. Inflation in April was, by South African standards, a tame 4.4%, almost smack in the middle of the central bank’s 3-6% target band. Moderate inflation is largely the result of subdued demand, sky-high unemployment and an economy that is clearly on the rocks. Even crude oil prices, which have been one of the main sources of price pressures in the economy, are currently near four-month lows.
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BUSINESS MAVERICK: Is the monetary policy genie out of the bottle?The ANC, newly invigorated after the elections, has put altering the mandate of the South African Reserve Bank at the centre of its developmental agenda and has touted exploring quantitative easing as a solution to SA’s many woes.
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BUSINESS MAVERICK ANALYSIS: SAA: Time for a Business Unusual approachNews of the resignation of SAA CEO Vuyani Jarana has aroused a binary response: If a private sector CEO with the credibility of Jarana cannot turn the airline around, then SAA is a basket case that must be placed into business rescue or sold. Alternatively, the narrative goes that Jarana’s departure is directly linked to Public Enterprises Minister Pravin Gordhan, who interferes and micro-manages, but denies crucial support when needed. The truth, as usual, is likely to be far more nuanced. sashaplanting What bs article, a donkey speaking!!!!!
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Sars increases tax return threshold to R500K to ease burden on taxpayers | IOL Business ReportSars on Tuesday announced that all taxpayers whose total employment income is not more than R500,000 will not pay income tax this year. You guys are aware that there is a difference between paying tax and having to file a tax return? Telling people whose income is less than R 500 000 that they wont be taxed this year is the reason why people have lost faith in you. Seriously this is very poor reporting! Taxpayers will still pay tax in terms of the Income Tax Act & its provisions. You don’t have to submit a tax return big difference. Please don’t mislead the masses.
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BUSINESS MAVERICK ANALYSIS: Tongaat Hulett scandal raises more red flags about governance in corporate South AfricaCorporate South Africa has long prided itself on its sophistication, governance ethos and commitment to the highest global standards of accounting and transparency. A strong corporate culture and deep and liquid financial markets for years set South Africa apart from many of its emerging market peers. That is starting to unravel, with Tongaat Hulett the latest South African company to signal that it will have to ‘restate’ profits because they were not up to scratch first time around.
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BUSINESS MAVERICK — INVESTMENT ANALYSIS: Naspers: to infinity and beyondCape Town based internet firm, Naspers, has announced it will list a subsidiary company, Newco, on the Euronext exchange in July. Newco will hold all of Naspers offshore technology assets, including Tencent, OLX and PayU, and will have a secondary inward listing on the JSE. Naspers will remain listed on the JSE.
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Business Maverick: Thursday, June 6: Five Things You Need to Know to Start Your DayBoeing is in talks for a megadeal that the trade war could derail. Asia equity futures are mixed after a U.S. stock advance. And the Trump administration readies a $2 billion Taiwan arms package. Here are some of the things people in markets are talking about today.
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Business Maverick: Tuesday, June 4: Five Things You Need to Know to Start Your DayThe technology industry is girding for sweeping investigations into its business practices and FAANGS got hit by the news. Asia equities are in the green despite a U.S. selloff. And China warns students on the growing risks of seeking a U.S. education. Here are some of the things people in markets are talking about today.
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Business Maverick: SA Needs `Robust Action’ to Cut Fiscal Gap, IMF SaysSouth Africa needs to take “robust actions” to reduce its fiscal deficit and reverse the increase in public debt, the International Monetary Fund said Let’s explain that to Cyril “the tortoise” Ramaphosa But we have a govt unable to make the really tough decisions
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