STUART THEOBALD: Not a bad time to be risk averse
Fears are growing across global markets, but the right inflection point has not yet come
As South Africans can tell their American friends, Mr Market is a brutal disciplinarian of political recklessness. When, at the height of state capture, then president Jacob Zuma fired finance minister Nhlanhla Nene in December 2015, replacing him with Des van Rooyen, the response was brutal. Bond yields rocketed 150 basis points, the rand collapsed more than 10% and bank shares lost more than 18%, precipitating a potential financial crisis. Days later, Van Rooyen was removed and replaced with Pravin Gordhan.
Watching the Trump administration’s past few weeks has been evocative of Zuma’s presidency. The playbook is remarkably similar: strip the main investigating agencies, such as the FBI and CIA, of their competent staff. Put sycophants in charge (Elon Musk is a proto Atul Gupta, calling up ministers and issuing instructions, storming into government departments and demanding access to systems, dispatching junior minions into government agencies to do his bidding). The only ...
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