In response to Finance Minister Pravin Gordhan's mid-term budget speech and his comments on ratings agencies and the role of the nation's media, J. BROOKS SPECTOR contemplates the circumstances of South Africa's economic future - and the increasingly shark-infested waters it finds itself in.
Back in the 19th century, in the heyday of railroad and canal construction around the globe, along with vast industrial-size mineral exploitation, nations and companies chartered by national governments routinely issued beautifully engraved, elaborately illustrated certificates for bonds and stock shares they sold to investors around the world.
These were purchased by investors - usually in more developed parts of the world - on the basis of whatever arguments for the viability and profitability they could find - or believe. Based on whatever information potential investors could find, gut feelings about the latest offering, and their desires for a profit, money poured into such investments.
Anthony Trollope captured that dog-eat-dog universe perfectly in his novel, "The Way We Live Now". Sometimes things worked out really well for investors. But in other circumstances, the fancy certificates ended up as pretty engravings, suitable for framing and hanging on the wall. (Curiously, there is now a secondary market for...