EDITOR'S VIEW
RON DERBY: Unlike the US, we can't just print more money to fix all our woes
We must rather deal with the governance failures that have enabled state capture, and do it in a manner that inspires confidence
On October 8 2008, the world's leading central banks - the US Federal Reserve, the European Central Bank, Bank of England, and the central banks of Canada, Sweden and Switzerland, for the first time ever, cut interest rates in a coordinated manner. They did this to save the global economy. It was just under a month after the collapse of Lehman Brothers, which would trigger the deepest recession since the Great Depression of the 1930s. Following their lead, South Africa's Reserve Bank would cut the repo rate from 12% to 5% by July 2012. This was a move that, along with the counter-cyclical fiscal policy followed by President Jacob Zuma's first years in office, would support the economy through the worst of the 2008 global crisis. It's a trick that worked well and the largest benefactors were retailers such as Mr Price and Woolworths. This was a period marked by a state increasing its wage bill and a Reserve Bank at its most accommodating in modern history. But there would always be l...
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