So we are poised for another interest rate hike! Everyday I write my blog things just seem so familiar, spiralling crime, unrest in the townships, every increasing fuel prices, people losing their homes, untrusted politicians, runaway inflation, disinterested politicians and of course a steadily increase in the interest rate… Sounds like the 1980’s all over again. Well I suppose the more things change the more they stay the same.

So what will “he who wishes to curb inflation at any cost” do today? South African Reserve Bank governor Tito Mboweni’s will make his announcement at 15:00 today and the country is bracing itself for a 1% (or 100 basis points as the economists love to refer to it) increase. Now Mr Mboweni, I am no economist but I am just a little confused by your manic obsession with curbing inflation by raising interest rates, maybe you can explain it to me like I am a three year old… how is raising the interest rate and putting more people out of their homes going to bring down the world food prices or the current oil price, both of which are major contributors to our inflation?

I reckon some influential dude at OPEC will be reading my blog this morning and decide “Hey wait, lets produce more oil, bring down the price and make Tito look good” Then he will phone his mate at some obscure chemical company and say “Stop turning all those crops into unprofitable bio-fuels, the world needs to eat” Then together they will simply write off billions of dollars in profits and we can all have our credit cards back.

Now, why make the announcement on a Thursday? Well let me tell you there is not a stock broker, analyst or fund manager who will not be sitting eyes on the television, computer screens flashing and phones poised as the announcement is made. No one gets this afternoon off I assure you. So imagine if he announced it on a Wednesday… golf courses around the country would be all but deserted, caddies out of work and bored barmen shuffling glasses, imagine the adverse effect that would have had on our economy.

If you are a gambling man, buy bank and retail shares this morning and site tight. If the expected 1% comes along you may see a slight dip in share prices but the market has already compensated for that. If the rate goes up by 2% you will just have to give your house and cars back a little sooner than you expected and if it only goes up by 0.5% the shares will probably soar and you can say “Hell that oke that drinks all that coffee should be running the country”

Qu’ils mangent de la brioche – Let them eat cake. The origin of many phrases in English are unknown. Nevertheless, many people would say that they know the source of this one. It is widely attributed to Marie-Antoinette (1755-93), the Queen consort of Louis XVI. She is supposed to have said this when she was told that the French populace had no bread to eat. Well Mr Mboweni let’s not forget what happened to Marie-Antoinette.

Speaking of cake, there is a little home industry store in the Balfour Park shopping centre that has one of the finest chocolate cakes you will ever taste. It is made by baker number 5 and is worth the visit. Save me a slice if you can still afford it after 3pm today.

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