Piet Retief ; Die ware een

Hierdie artikel het in Beeld 2 Oktober 2012 verskyn.   Maak daarvan wat jy wil 

Die ware Piet Retief

2012-10-02 22:17 
JC van der Walt

Die Voortrekkerleier Piet Retief is ’n held in die Afrikaner-geskiedenis, maar hy het ook ’n donker kant gehad, skryf JC van der Walt.
Toe Dingane Piet Retief so grusaam op 6 Februarie 1838 vermoor het, was hy ’n ongerehabiliteerde man. Nadat sy boedel in Januarie 1850 beredder is, het sy kre- diteure slegs 9% van die geld teruggekry wat Retief hulle geskuld het.

In 1813 het die regering ’n kontrak aan Retief vir die lewering van rantsoene aan 1 200 troepe op die oosgrens toegestaan. Retief het gou daarna versuim om sy leweransiers te betaal. In 1814 het hy aan die maat-skappy Matfeldt en De Necker die reuse-bedrag van 83 247 rijksdaalers geskuld. Dit was gelykstaande aan vyf keer die jaarlikse salaris van goew. Sir Andries Stockenström. Retief kon nie sy skuld betaal nie en die regering het sy kontrak gekanselleer.

Op 4 Julie 1814 het die brandarm Retief met Lenie Greyling, ’n skynbaar welaf weduwee, getrou. Retief het haar erfporsie van 5 000 rijksdaa-lers verkwis en Greyling is as ’n armlastige dood.
Lt.kol. Willshire het teen die lawaai en dronkenskap van die soldate by Retief se kroeg beswaar aangeteken en op 31 Augustus 1819 het die regering geweier om Retief se dranklisensie te hernu.
In 1822 word Retief as veldkommandant van Albany aangestel, maar hy word afgedank nadat hy met die regering oor twee boukontrakte in onguns gekom het.

Tussen 1823 en 1824 het Retief 20 keer in die hof verskyn weens skuld wat hy nie betaal nie. Retief sweer ’n eed voor God, in die teenwoordigheid van heemraad Miles Bowker: “Ek besit geen goedere van enige beskrywing hoegenaamd nie.”

Dit was ’n doelbewuste leuen, want in daardie stadium het Retief 1 000 skape, 300 beeste, 80 perde, 11 slawe, plaastoerusting, waens, meubels, gewere en ’n klavier besit.

Retief het by verskeie geleenthede valse verklarings afgelê.

Die eerste uitverkoping van Retief se goed is in Maart 1824 gehou.

Tempest, sy ingevoerde resiesperd, is vir 5 500 rijksdaalers verkoop. ’n Erf op Grahamstad plus sy perdewa, ossewaens, beeste, skape, perde en ’n klavier is verkoop. Retief se agt slawe het 12 050 rijksdaalers behaal en vyf erwe het 2 480 rijksdaalers behaal.

Die opbrengs van die vendusie in 1824 was 31 361 rijksdaalers. Ongelukkig het sy krediteure ’n verlies van 2 254 rijksdaalers gely. Hulle is nooit betaal nie.

Retief was nou in groot geldnood.

In 1826 het Retief 141 skape en 30 bokke op krediet gekoop by Maria, ’n slavin. Hy het ’n skuldbewys onderteken om die slavin 249 rijksdaalers te betaal. In 1827, nadat die slavin en Joseph van Dyk, haar eienaar, 18 maande lank probeer het om Retief te oorreed om sy skuld te betaal, meld hulle Retief se swak gedrag aan by die beskermer van slawe in Kaapstad. Retief het die slavin nooit betaal nie.

Tussen 1827 en 1829 het Retief meer as 20 keer in die hof verskyn weens onbetaalde skuld. Tussen 1830 en 1833 het Retief 19 keer in die hof verskyn weens die wanbetaling van sy skuldeisers. Retief is toe bankrot verklaar.

Op 4 Januarie 1832 het W.E. Smith Retief gedagvaar oor sy skuld vir 80 gelling Franse brandewyn en 18 gelling Franse wyn.

In Maart 1832 het J.H. Heath vir Retief gedagvaar vir die wanbetaling vir Franse brandewyn en wyn. Die vonnis kon egter nie uitgevoer word nie omdat Retief se besittings onder beslag was. Mev. Lenie Retief het aan die hofbode gesê: “Ek het geen geld in die huis nie.”

Kapt. Duncan Campbell, Albany se magistraat, verklaar Retief “nulla bona” op 18 April 1832 en Retief word tronkstraf opgelê. Retief ontduik die gereg, maar in Augustus 1832 word hy in Grahamstad vir die wanbetaling van verskeie skuldbewyse opgesluit. Hy weier om 58 gelling vir “ou Madeira-wyn” aan sy vriend, die vrymesselaar Benjamin Norden, te betaal. Norden het Retief verskeie kere vir skuld gedagvaar.

Uitendelik het Norden sy eis afgeskryf en Retief se skuldbriewe betaal. Daarna is Retief uit die gevangenis vrygelaat. Norden het slegs 9% van sy eis teen Retief se bankrot boedel teruggekry.

Op 28 September 1832 het T.H. Hales, die bode van die hof, al Retief se huishoudelike besittings in die Grahamstown Journal geadverteer.

Gedurende 1833 was Retief se finansiële posisie uiters desperaat. Hy het probeer om as toesighouer oor houtkappers in die regering se bos, Coeremoe, ’n karige bestaan te maak. Hy is egter nalatig en word op 8 Oktober 1833 deur magistraat Duncan Campbell ontslaan.

Retief was ook by verskeie oneerlike transaksies betrokke.

Op bedrieglike wyse het hy die afmetings van twee van sy erwe in Grahamstad vergroot. Nadat hy die erwe aan die regering verkoop het, word hy uitgevang. Kol. Henry Somerset het in 1820 die volgende aan landdros Jacob Cuyler geskryf: “Mnr. Pieter Retief het homself wangedra en dit was baie onwelvoeglik van hom om die regering te bedrieg.”

Retief het besluit om die regering met ’n skema te nader om sy eie huis in barakke vir soldate te omskep. Op 11 Maart 1822 het lt.kol. Maurice Scott geskryf: “Ek verstaan dat Retief se finansiële posisie uiters benard is. Hy beskik oor geen ander middel om homself uit hierdie vuur te kry as om die huidige aanbod van die regering te aanvaar nie.”

Op 7 Mei 1822 het die regering ’n kontrak van 40 000 rijksdaalers aan Retief toegeken vir die bou van die barakke. Op 6 Julie 1822 het die regering ’n verdere kontrak van 25 000 rijksdaalers met Retief vir die bou van ’n drosdy gesluit.

Retief het die regering met 10 000 rijksdaalers bedrieg deur dubbele fakure, vir werk gelewer, in te dien. Toe die regering die bedrog in Augustus ontdek het, het Retief reeds al die geld gespandeer.

Op 25 Maart 1823 het lt.kol. Scott geskryf: “Ek kan u verseker dat dit met groot spyt is dat ek, namens die regering, ’n kontrak aangegaan het met ’n man sonder enige beginsels hoegenaamd; dit was my ondervinding met Retief.”

Die regering het Retief vir 10 000 rijksdaalers gedagvaar en op 3 November 1823 het regters P.J. Truter en B.B. Borcherds Retief skuldig bevind. Retief se appèl is summier geweier. Die regering het besluit om Retief se kontrakte te kanselleer.

Retief het verskeie persone, ook weduwees, met geld bedrieg. Hy het byvoorbeeld sy slaaf, Jack van Mosambiek, aan verskeie krediteure vir geld verpand. Retief het sy krediteure 20 jaar lank ontwyk deur valse verklarings onder eed aan die bode van die hof af te lê. Sy familie het selfs die geregsbode met geweld uit sy huis verwyder.

Tydens ’n vergadering van sy krediteure op 26 Junie 1834 het George Jervis, die prokureur, gesê: “Hierdie boedel is reeds 15 jaar lank insolvent.”

Retief word op 8 Oktober 1836 bankrot verklaar en hy het besluit om by die Groot Trek aan te sluit.

John Mandy, die eienaar van die Freemason’s Tavern in Grahamstad, het Retief in Januarie 1837 vir 228 rijksdaalers gedagvaar “vir drank, losies en vermaaklikheid aangebied en verskaf op versoek deur Pieter Retief”.

Op 1 Februarie 1837 het Retief ’n brief aan sir Andries Stockenström geskryf en die regering verantwoordelik gehou “wat my welvaart ontneem het”. Op dieselfde dag het hy sy skuldverhoor in die hof ontwyk. Op 2 Februarie 1837 het Retief vanuit sy pos as veldkommandant gedros en sy beroemde manifes is op dieselfde dag in die Grahamstown Journal gepubliseer.

Stockenström het Retief op 6 Februarie 1837 ontslaan en presies een jaar later het Koning Dingane goew. Pieter Retief by uMgungundlovu vermoor.

- Dr. Van der Walt is die skrywer van Zululand True Stories, 1780 to 1978 waaruit hierdie artikel kom. 

Financiers, Consumers, Debt Collectors, Lawyers and other Animals.(Episode 2)

Episode 2 

Financiers, Consumers, Debt Collectors, Lawyers and other Animals.

What happens when a debtor defaults on his/her commitments towards a Creditor.   What are the actions Creditors take ?

Without going into too much detail one or all of the under mentioned is going to happen:

The debtor might phone the creditor or visit them at their place of business to discuss his problem. The Creditor might phone the debtor. Invariable a letter of demand will be in the mail already.  Initially all will be very cordial and possibly an arrangement as to how this is going to be rectified will be made.  All fine and well?   Nooo not really…………..  Should the debtor default on this arrangement the tone of voice and accompanying facial expressions is going to change. Smiles disappear.  

You will be greeted by a very official good morning Mr.  You will not be John or Mary anymore. You will be Mr or Mrs……………

Just for clarification : It is in all probability not the doing of the debtor that landed him in the predicament. One of a few things could have happened.

Firstly The creditor might not have given execution to his required caution in terms of the NCA in that he might not ( More than a 50% probability) have evaluated the debtors ability to repay the borrowed money.  This could be classified as reckless lending which could cost him the loss of the full capital lend out. (This action will be discussed in more detail later)

Secondly The debtor might have encountered a few  problems:  He might have had a serious sudden expense (broken down vehicle, burglary,  whatever) This can normally be handled in a month or so if the creditor plays ball and extend the possible arrears.

He might have lost his job, might have been retrenched, his business might have a cash flow problem or any other real reason.  The reason normally is of no real concern to the creditor.  You see ….as far as they are concerned it is the problem of the Debtor.

Now the problem might escalate. The debtor might not be able to honour his commitments anymore and will start avoiding the threatening phone calls, Sms’s or emails.  The Creditor will now send out a notice in terms of s129 of the NCA which by law have to be received by the Debtor before any legal action can commence. Please not I say RECEIVED. ( in a recent case commonly known as Sebola it was established by the constitutional court that proof of receipt of this notice must be given and not just proof of dispatch thereof)

Normally at this stage the debt might be given over to debt collectors who will start the process again of phoning and threatening the consumer.   In some cases, depending on the bank’s view of possibility to collect, the debt is ceded to the debt collectors who now operate on the view that you owe them money.  Should the debtor make an arrangement with them they will collect a collection fee as well as interest.   They will in all probability send the debtor an AOD (acknowledgement of debt) where amongst others the debtor will wave his right defend any action and consent to judgment.

I will in future episodes handle all the different ways and tricks Creditors use to extend pressure and stress on debtors.   For now I am only going to list a few actions a DEBTOR  might take and cautions to observe when dealing with Creditors.    I know I might get a lot of flack from a lot of people (mostly creditors) but what the heck.  I am playing with the lions tail and I might just be gearing up for a class action of sorts – details later.

Here are the  7 cardinal rules when confronted by a Creditor:

(Just remember : should this land a court of law the creditor will use every piece of paper and every word in a conversation against you)

1.     Never admit to owning them anything – not verbally or in writing.

2.     Never make specific arrangements you do not have 100% control over.(and you most probably never have 100% control over anything!)

3.     If phoned by a debt collector no matter who they are insist on them identifying themselves.  The following are the bare minimum you request they email to you:

a.     A copy of their mandate from the Creditor to act on his behalf.

b.     A copy of the debt collector’s registration certificate with the debt collectors council.

c.      Proof that the caller are actually employed by the Debt collector agency.

d.     A copy of the original alleged instrument of debt.

e.     A full copy of how they have arrived at the alleged amount owed to them.

f.       Full details of the relationship between the debt collector and the debt – is he operating on behalf of a creditor or has he taken session of the debt.

4.       Never but Never sign anything – Like in Never.

5.       If you ever consider to ignore rule 3 see a Lawyer first !

6.       Especially never sign a new AOD  - never !

7.       Do not agree with anything that is said to you on the phone- remember

  you do not know who the person on the other side is.

Episode 3 to follow

Financiers, Consumers, Debt Collectors, Lawyers and other Animals.

Episode 1

This blog post has had a long incubation period. Probably not quite the right word, it is more a question of was I going to go the route or not but I do think the time has come to start pulling the lion’s tail.

As we all know DEBT and CREDIT probably means the same thing. They are both swear words and worse than the one’s you hear on TV.  The moment you are given credit by a Financier you are in DEBT. The process and documentation involved are really very intricate although most financiers do not really think so.  The arrangement between you and the creditor now are regulated by various acts. I am discussing this specifically in the South African context.

Over a long period of time the government of the day, in its unfathomed wisdom created acts that govern the relationship between the parties and I am quoting a few of these:

1.     The present National credit act

2.     The Consumer affairs act

3.     The Supreme court act 1959

4.     The Magistrates court act 1979

5.     The attorneys act 1979

6.     The debt collectors act 1998

There are a few more but these are the main acts I might refer to in this post.  

The relationship between a consumer and a creditor are born out of the consumers’ need for money and the creditors’ ability and willingness to lend this the consumer.  This is not the extension of a service to the consumer, it is the need (or greed) of the creditor to make money out of the transaction. 

As an interlude the above definition nullifies all banks’ claims that “we are there for you” or “what can we do for you” and all that bull.

The present National credit act (NCA) governs to a great extend the initial relationship between Creditor, Debtor, contract requirements, defaults et all.

For the purpose of this post I am specifically referring to the possible (and in most instances inevitable) decline of the relationship if (when) the lender defaults.   What is import to notice here is that the financier (Bank – whoever) evaluated the debtor’s financial position as per instruction by the NCA  and upon finding it to their liking extended the credit to the debtor with the aim of making money out of the transaction.   The relationship always had a 50/50 chance of success at best.

Either the debtor would be an angel and keep his job, get increases at regular intervals and pay his required payments as arranged.  Or he could lose his job, his business could fail, he could be retrenched, he could get ill to the extent that he no longer can earn an income.  There are a few hundred more reasons this could happen.  The point I am making is that this invariably happens to good people too!

Unlike what banks say in some of their threatening letters I still have to encounter a debtor who “Choose not to pay us” or “choose not to honour your agreement”.

Now once(if/when) this relationship do go south the client's status immediately change from “client” to  “ Problem” with the accompanying change in tone of voice when he is spoken too. Also the accompanying change in facial expression, tone of letters etc. 

How does a debtor handle this? I will not go into the reasons for the decline but only as to what happens and how does a debtor defend himself against the onslaught of verbal abuse he or she is going to have to endure.

In episode 2   I will discuss what exactly happens to the creditor and what is done from the creditor’s side.

In Episode 3    I will discuss the actions a consumer can take to defend himself against the onslaught. 

Stressed out? Read this, you just might sleep better tonight

I started writing a blogpost on stress. It is much longer than this and I might finish it one of these days.  Now you must understand that a lot of Stress experts might differ from me.  But that is not my problem, it is theirs!
This is precisely the point I want to make:   Who is in control of your life ? You or the rest of the world ?
Most people have opinions and beliefs that was and is given to them on a daily basis and which they embrace.  They will not differ with the dominee, pastor, priest, doctor, lawyer, creditors, et all for the simple reason that it is not done. They are the authority on their subject and they know better.  That is why I am posting this on this blogsite. That is because that is Bulls..t.  That is why you are getting stressed out.

I recently had a call from a lawyer firm's call center of behalf of a creditor   ( SABC Tv licenses) claiming I owe them money.  I said to the agent that I have not had a tv for the last 7 years and that I have informed the SABC about this fact 7 years ago. " Can you prove it sir? "  "No, I cannot and I am now finished talking to you"  "You have to talk to me!"    I simply put the phone down.

Why am I so sure of myself ?  Because I know the facts.  There are laws governing this type of interaction in South Africa and the one's most applicable here are:  The Anti Harassment act, The consumer affairs act and  the act on prescription of debt. ( I know the inner workings of these acts as if I have written them)

In this little interlude I am making the point that the 2 major stress agents in life is people and money  (or the lack thereof, or the ownership someone claims to your money)   Are you with me ? The main problem however is that people do not have the capacity to deal with these interludes for the simple reason they do not not seek professional help.  The quoted interlude happens daily to thousands of people and they will just endure the harassment and get stressed up more and more with every additional interlude !

There is an old Chinese proverb ( I love to call it Chinese proverbs because anything that I do not know the source of I attribute to them) that says :  "If you don't know, nod wisely, leave calmly and then.......run like hell to get an expert !"

Just for today:  Refuse to be a victim,  instead choose to be a victor.   Stand your ground like a man/woman who claim the right to be their own number one ! Take deep breaths before deciding to react to the other drivers finger language.  Ditto when you get shoddy service and be very polite yet absolutely affirmative in your response to claim good service.  Once you get going on this list it just seems to be never ending and you start to feel in control more and more every day.


(Read my follow up on how to deal with pestering call center agents and how to project all the stresses of the situation onto them)(shortly) 

Interesting facts about Cerials

Whilst hunting for tips on getting your cholesterol in check I found a lot of writings on the subject and will be posting some of them here
This article by Readers digest could be a good indication of whether your breakfast diet(or that of your children ) is in good health :

With recognition to Readers digest website :


www.rd.com Homepage>Health>Healthy Eating>

Doing research on getting one’s cholesterol in line I found some interesting articles and this one especially caught my eye. Interesting facts about Cereals



 Sneaky Ways “Healthy” Cereal Makes You Fat

Outsmart these common cereal slip-ups to pick the healthiest breakfast cereal and pump up the nutrition in your bowl.



1. Is cereal really dessert in disguise?

Scan a typical grocery store aisle. With about 130 varieties of cold cereal, each box yelling its seductive “low sugar!” “high fiber!” “great source of whole grains!” health claims, it’s easy to feel, well, bowled over. “Some cereals are as healthy as salad, others are like scarfing down a chocolate eclair," Dawn Jackson Blatner, RD, author of The Flexitarian Diet, recently told Health magazine. "But while there are a lot of sugary cereals, happily, it's easier than ever to find a really nutritious one." Here’s how to find the healthiest cereal for you.



2. When your healthy cereal is a sugar bomb

Grab your favorite cereal box and look at the ingredient list: You may be shocked to see that some form of sugar appears—perhaps multiple times—in the first few ingredients. “Even if a cereal is made from whole grains or loaded with other healthful ingredients, a high sugar content disqualifies it from my list of top picks,” Today contributor and nutrition expert Joy Bauer, RD, says. Too much sugar adds unnecessary calories, and it also spikes your blood sugar and primes you for a mid-morning energy dip. Enter snack cravings!



Healthy cereal makeover: Expert recommendations vary, but most say look for fewer than 5 to 8 grams of sugar per serving. (Don’t judge a box by its cover: Quaker Honey Graham Oh!s cereal, for instance, has 12 grams, while Lucky Charms cereal has 10 grams.) For great options, check out FitSugar’s list of low-sugar cereals, where most have 5 grams or fewer. If you still can't give up on your favorite, mix it with a serving of low-sugar cereal.



3. When your healthy cereal skimps on whole grains

Whole grains are linked to weight loss and a decreased risk of diabetes and heart disease, and a bowl without them should be a deal-breaker. But it can be confusing, thanks to misleading front-of-box claims like “More whole grain than any other ingredient!” and “with whole grain first ingredient.” The Nutrition Action Healthletter, a newsletter from the watchdog group The Center for Science in the Public Interest (CSPI), warns that in roughly half the cereals that make those claims, the second ingredient is refined.



Healthy cereal makeover: The label you’re looking for is “Made from 100% whole grain.” Check the ingredient list—the first ingredient should be preceded by the word “whole.” One exception is bran, which can’t call itself 100% whole grain, but is still a great source of fiber. Ideally, the first two ingredients should be whole grain, bran, fruit, or soy, according to the CSPI’s “Best Bites” rating system. Some that make the cut: Post Bran Flakes, Kashi GOLEAN, and General Mills Fiber One 80 Calories.



4. When your healthy cereal contains fake fiber

Fiber deserves a place in the Nutrition Hall of Fame for its ability to promote fullness and lower the risk of certain chronic diseases, but cereals that boast of sky-high levels are probably using added isolated fibers such as chicory root fiber, soy fiber, or psyllium. The Nutrition Action Healthletter says that there “isn’t good evidence that these lower the risk of heart disease, constipation, and diabetes the same way intact fiber, the kind in the outer layer of whole grains, does.” And research suggests that inulin (chicory root) doesn’t give you the same fullness as innate fiber, according to Health magazine.



Healthy cereal makeover: Choose cereals with at least 3 to 5 grams of fiber, but be skeptical of claims like “40 percent of your daily fiber,” warns the Nutrition Action Healthletter, which is a sign the fiber isn’t the natural kind. Of course, the easiest way to pump up the fiber in any cereal: Top it with fruit. A half-cup of raspberries has 4 grams, about 17 percent of your daily need.





5. When your healthy cereal is pumped with sodium

You’ve probably heard that our national love affair with salt is more a result of processed foods in our diets than the stuff in the shaker itself. Sneaky sodium packed into foods that don’t taste salty (like cereal) tricks our taste buds into craving salt, which can lead us to other waistline-padding junk food.



Healthy cereal makeover: To make the cut for Self’s Healthy Food Award guidelines, cereals have no more than 250 milligrams of sodium per cup. (Kelllogg’s Raisin Bran, for example, has 210 mg.) However, we often eat more than the serving size—so be mindful before you reach for seconds.



6. When your healthy cereal is missing protein

If your cereal bowl is naked—pretty much just the flakes and milk—it may be too low on protein to keep you sufficiently satiated, which can impact how well you eat all day long. In a new University of Missouri study, people who ate a high-protein breakfast (eggs and lean beef) felt more full, had fewer cravings, and were less likely to snack on high-fat, and high-sugar foods at night, compared with a group who ate a calorically equivalent bowl of cereal or no breakfast.



Healthy cereal makeover: Add a tablespoon of nuts or flaxseed to your favorite cereal for an extra protein boost, or top Greek yogurt (an excellent source of protein) with a small handful of your favorite cereal flakes for crunch.



7. When your healthy cereal forgets to make friends with milk

The milk you add to your cereal helps make it a more nutritious meal by contributing protein, calcium, and other key nutrients. Harvard research shows that people who eat dairy foods frequently are 21 percent less likely to develop insulin resistance, and 9 percent less likely to develop type 2 diabetes. What’s more, fortified vitamins and minerals are sprayed on cereal and dissolve in milk, according to Health. If you don’t drink all of it, you miss them.



Healthy cereal makeover: If you don’t like milk, eat your cereal dry to get all of the added nutrients, and get a dairy boost from other sources, like Greek yogurt or low-fat cottage cheese, the magazine recommends.





8. When your healthy cereal serving is too big

In a recent test of portion control savvy, Family Circle magazine volunteers poured cereal bowls that were twice as big as those recommended (1 1/2 cups and 240 calories compared to a 3/4-cup, 120-calorie serving). Do that with a calorie bomb like granola, and it could take a real toll on your waistline.



Healthy cereal makeover: Don’t assume you know what a serving size looks like! Measure it out and see how it fits into your bowl so you know how to eyeball a healthy portion. Also, consider eating with a teaspoon instead of a tablespoon, recommends Women’s Health magazine. This can make you eat more slowly and cut your overall calorie intake. Another neat tip: Eat the cereal out of a coffee cup instead of a big bowl to trick your brain into thinking you’re eating more.





9. When your healthy cereal stays out on the counter

Believe it or not, keeping the box in plain sight may make you more likely to top off your bowl or take a couple of handfuls here and there all day long. Grazing like this can add up to a serving or more, says Women’s Health.



Healthy cereal makeover: Put the cereal away after you pour it. If you like to snack on your favorite flakes during the day, portion out the serving size you want in little snack-sized baggies. Consider mixing basic whole grain flakes with nuts, seeds, and mini chocolate chips for a satisfying trail mix.

Challenging the banks to put their money where their mouths are

Here is my challenge to banks: Please tell me why I should bank with you ? Massive weekend advertisements focuses on cost saving but nothing is said about client service - How knowledgeable is your staff when it comes to my needs as a client ? This is a question probably not answerable as easily as it seems - Think on it before you answer - I will be posting the answers on FB

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    Mark as spam

    Absa 
    

    John, a rather ominous and open-ended question indeed. We'd like to respond with the following: What we do; is offer great customer service delivered by talented, motivated people. How we do this is entirely different set of individual processes; The Group seeks to have a customer-centred mindset in everything it does to deliver a consistent customer service experience and to demonstrate professionalism and integrity in serving its customers. Absa has and continuously employs talented, energised and passionate people to make this happen. The Group also strives to create an enabling environment for its employees, which in return provides leading-edge service to our customers. Thank you.
    John Brandow Very ominous and open ended indeed - will soon comment on this on my own blog and send you the link - The theory is very nice - I would like to challenge you to prove it after I have related some my own experiences. I have sent the same question to all 4 of the major banks - lets start a discussion on this ?
    

    4 minutes ago · 

    

    Absa ‎John, unfortunately we will not engage with our competitors in an open ended online debate. It is against our Business Policy. If you would like this process to be formalised, please ensure that you use the correct channels for such an inquiry or processed debate on the matter. Thank you.

    2 minutes ago · 

Can you bank on your bank ?

The recent altercation between Absa and Solidarity and the massive advertising campaigns in the Sunday Press prompted these comments.
What are banks really focusing on ?   Where in the whole picture is the client ?  Do banks actually know what clients want ?
Here are some observations:

The main focus in the advertisements are costs.  Every one of them promises to reduce your costs.  Of course this is very important. They have been screwing their clients all along and now they are correcting the wrongs of the past and pay exorbitant advertising costs to tell us that.

Nowhere in any of the ads are there any mentioning of increased CLIENT SERVICES.

Nowhere in any of the ads does it tell you we will be looking after ENTREPRENEURS. Or we will make sure there are properly qualified staff to do the interviews with prospective clients.   Has anyone ever really ASKED clients what they really want ?

I walk into a banking hall ( and I have done that to 3 of them on the weekend)  No smiles unless I asked them where are the smiles ?   The guard at the cashier gate at one of them was checking us out as if we were going to rob the bank.  The Cashiers was not impressed because they were working on a weekend.  The formidable barrier between client and cashier makes you feel you are visiting a relative in jail and he really does not want your visit.  The pens at the desks of two of them did not work.  One was fixed to the counter with a piece of dirty string .

This is just my introduction on what I perceive as what is wrong with our banks - Watch this space 

Absa vs Solidarity

A very interesting duel is developing between Absa and Solidarity.  This might just become a very interesting study in the power of Social Media.
 
As we all know Banks lie through their teeth and they will cheat to the nth degree to get what they want - If you differ from me I will send you some proof of this in my own encounters with this same famous bank. So far Solidarity's action has had over 380 000 tweets going around - The largest every initiated by a trade Union in South Africa.  

What is really the truth ?  I know people that have gone through the layoff process - Absaspeak off course gives a different view. They were actually told to clear out their desks,  being "marched out the office" and escorted out of the building with no regard to dignity - I can just see the smirks on the faces of the managers standing watching on the side. Unfortunately we cannot reveal their identity as this might just jeopardize their "possible re-employment"  by the bank.

Maybe , Just maybe Absa should stop their court action - It is not going to go well off with clients - But lets wait and see.  

See also my comments on the blog : www.donottrustbanks.blogspot.com 

The Bull about colour

Scotopic Sensitivity Syndrome is an illness where the persons having it has difficulty in reading amongst others black writing on white paper.  It can also be described as "restricted field of clear vision", and has a common name : Irlens disease.  This is treated with very good effect by introducing other colours into the equation.   That is the first definition I need to explain here.  The second one can be called " Constricted field of vision"  it's common name being tunnel vision.  My perseption is that it is not really treatable.  You do not see the sides of the tunnel - just the little light at the end of the tunnel.  The latter is figuratively speaking whilst the first one is a physical illness. Both however can be used figuratively as I am going to do here. 

Getting back to Irlen: It shows that colour is of the utmost importance, whilst the problem mainly lies in black and white.  I am not going discuss the definition of certain colours here and I am also referring to white and black as colours.  Colour is a fact of life and the spectrum is enormous.  The reference to "people of  colour" normally refers to people that are not white.

Traditionally in the Western world people of colour have been suppressed and oppressed a lot, also in South Africa. During the last century or so things have slowly started to change to the extend that the mightest of nations now has a president of colour. The whole government in South Africa now basically consist of "people of colour"  

Now it is a fact that "people of colour" are very sensitive about the colour of their skin and any reference to it will immediately be labled as "racist"    The previous government introduced labour reservation which basically reserved certain work for Whites only.  Come the new government they just relabled it and tweeked it a bit and called it "Affirmative action"  Any student of the latter definition will know that the definition as it was originally created in the USA actually stated the opposite of what it is used for here. (The colour of your skin cannot influence your job application.)

In forums where I am involved in on the internet it is evident that the colour issue has not and probably will not in the near  ( or even distant ) future be laid to rest.  Terms like white supremists and black consciousness are quite often mentioned.  You will see that I am quoting these things with no feeling for whatever colour is involved.  I feel nothing for one of the terms. It is being kept alive by laws of a visionless government with visionless leaders. Their ability to see the outside from anywhere but the tunnel they are in is totally constricted. Hence the referal to tunnel vision. ( I have argued the point about BEE and its sister Affirmative action before and still contend it to be the core of sustained rascism )

Lastly (for now anyway) the issue of perceptions.  It cannot be argued away that certain perseptions are being kept alive by all sorts of people and the press.  Some of these are : "People of colour are more likely to be a criminal"  As you all know : The truth has nothing to do with this , it is only the perception that counts.

Now people make videos and films on this and try and proof a point whilst the film or video actually creates the perception.  Another one :  " White doctors are better"   Says who ? In the past black doctors did not have a chance to proof themselves but the perception will live on for probably another 100 years or so.

I think it is necessary that black and white accept they have to introduce some other colours into their lives:

Light red represents joy, passion, sensitivity, and love.

Pink signifies romance, love, and friendship. It denotes feminine qualities and passiveness.

Dark red is associated with vigor, willpower, rage, anger, leadership, courage, longing, malice, and wrath.

Brown suggests stability and denotes masculine qualities.

Reddish-brown is associated with harvest and fall.

Red-orange corresponds to desire, passion, pleasure, and thirst for action.

Gold evokes the feeling of prestige. The meaning of gold is illumination, wisdom, and wealth. Gold often symbolizes high quality. 

 I can quote another 50 or so but hopefully you are getting my drift.

To be continued...................................Next chapter :  The total lunacy and stupidity of the South African government relating to the situation in Libia .

The Bull about direct insurance

Reprinted from Moonstone's weekly news letter in the public interest

Myth 2: Financial adviser commission inflates premiums of intermediated product


Willem Roos, the CEO of direct insurer OUTsurance was quoted in Business Report as saying:

“But certainly on average our research indicates we offer better value for money than the intermediated businesses and it’s particularly because the acquisition costs are much lower ... they are not necessarily always the cheapest because you get risk differentiation. We tailor make a premium for each and every client so depending on your risk profile we might actually charge more than an intermediated business.”
FAnews said:

The second myth grew out of the specific theme of direct short-term insurers' advertising. They claimed their pricing 'edge' was due to "cutting out the middle man" and not paying over commission to the intermediary. Consumers bought this claim 'hook, line and sinker' and so it comes as no surprise that the direct life insurers are 'peddling' the same lie. The reality, says Discovery Life, is that higher marketing budgets and operational expenses among direct players, including call centre salaries and sales incentives, replace the commissions paid by traditional insurers to intermediaries. A quick look at the Financial Mail Adfocus, published November 2010, confirms that the country's direct insurers spend heavily on advertising. Six direct insurers feature among South Africa's Top 100 advertisers!

The Discovery research showed that, in their sample, the average premium of direct insurers was 9% higher than that of the intermediated products.

The claim that Discovery used selected market sections rings hollow. The direct houses chose to blame intermediary commission as the reason why they were cheaper. They did not differentiate then, so to use this excuse now won't wash.

What they are focusing on, in my view, is the misguided perception by clients that they can handle their own insurance needs. Consumers are woefully unaware of the cost of their own ignorance when it comes to claims. They only discover the real cost at claim stage.

I must admit to a certain degree of glee when I see statistics like this. The clever Johnnies who burn their fingers when it is revealed that they are not as clever as they thought.

Just this week, Martin Klopper of Worcester shared some hair-raising stories about the cavalier way in which direct short-term insurers tried to rip off a client. Through Martin’s intermediation the client got a fair deal in terms of what he was insured for.

One has to ask how many others who are too obstinate to ask for help get fleeced in this manner.

The intermediated option offers underwriting at application stage; the direct option at claims stage. Is it any wonder then that the following statistics are published in the Discovery study?:

“… the direct insurer had paid R6m in claim, while Discovery had paid R1.12bn. On the other hand the particular direct insurer had R38m in rejected claims, while Discovery Life’s had R23m in rejected claims…”

A common response to the FAnews article was a call for more public exposure of the findings of the survey.

We have in the past refrained from following this route out of concern for the damage this could cause the image of the industry. Times have changed.

As the old saying goes: you should not go into a gun fight with a knife.

If you want to throw mud, expect a backlash.

Client services in perspective : Banks

The following words are used in the banking world and these are undeniable facts: The explanation of the words are generic accepted definitions

1. Client Someone the bank has done business with or is doing business  with.

2. Client Services Something to be delivered to the person mentioned in 1 above.

If applied right this should be the ultimate purpose and vision of a any bank.

3. Profit Although not necessarily contained in their mission and vision statements the actual ultimate purpose of a bank.

4. Loss  : What the bank suffers if they are not paid their fees and interest. At all costs this must be avoided.

5. Client information :   The information the bank should have to be able to manage the relationship with the person in 1. above.

6 FICA :   A South African law governing the relationship of “know your Client."  This is minimum information the bank must have of its Client. Not meant to be a client relationship tool.

Banks have all very impressive advertisements, sayings and probably some of these are actually meant to work in the way it is intended. However hard they try their real purpose of existence is making money and supersedes all other intentions. The love of money and profit when it supersedes everything else can in the most appropriate way be described as “Greed”. So now we are at the point where the statement can be made that banks are in the first instance greedy.

Banks do business in a confrontational manner. Every document you are given to sign, every condition that is enforced on a client, every system* utilized , every action concerning a client is an absolute rule. You cannot negotiate. You cannot change the wording on any document. This is how you do it. This is where you stand or sit when you have to see someone. You have to go into one of the branches if you need to do something. The fact that there are 60 persons already waiting is a non issue. Wait ! I like to call it “hitlerization” Hitler did not understand that he was setting an example. It was only recently perfected when the modern banks came along.

Here is a paragraph strainght out of client service training manual 101 chapter 1 page 1:

“ When a prospective new client walks into the bank you will smile. You will greet him politely. You will determine the purpose of his visit. ( It is very important that these actions be concluded as soon as possible. It must NEVER exceed 2 minutes.) During this period you need to determine the level of this prospective client’s actual Wealth. The bank needs to determine how much money we will be making out of him.

If he wants to open a savings account refer him to enquiries as soon as possible. If he wants a loan he is prime target. The bigger the loan the better.

Should a client want to speak to a consultant about possible defaults or arrears you must understand that although the client might think he is still a client he is not. He is now the enemy. He is the personification of evil. He steals your bonus at the end of the year. Treat him in a manner that he understands he is not a very likeable person anymore. Refer him to the collections department who is specially trained to make him feel guilty , get him to sign new

Promisary notes or even consent to summary judgment. They know how to do this without him actually knowing what he is signing “

Your status as prime client changed to that of criminal the moment you defaulted on something and are now actually costing them money. “You must come and see a consultant” “I am sorry but I will not” Ooh aches and pains “Ok when and where can the consultant see you at a place and time that will suit you sir ? “

Suddenly an attitude change : They might actually lose money now if they do not play to the customers tune !

The big swear word causing all the commotion of course is “Credit” If a potential client visit a bank with the purpose of opening a savings account he will be asked to fill in a form. Hitlerization requires the bank to check his credit record. What the.....hell for? He is not borrowing money ?

Fica sir. Yes Fica you too! Fica does not require the bank to check your credit record but big brother needs to keep track of what you do with your money.

You have to build a “credit record” sir . Why? So you can buy a house or a car on credit – you know we need the interest ( and the funny little costs )

Banks that used to be there to keep you money safe have now created a paperless economy with funny money. They call it “credit” Government even created a new law called the “Credit act”

What was the purpose of this act ? Apparently it was to safeguard the client. Who has been safeguarded apart from the banks ? Pray tell me !

Banks now use this act to their advantage. They pry every little personal detail out of their prospective clients. Nothing is sacred anymore. For them to give you a R 1000 loan they require of you to fill in an umteen forms and documents. Even trying to open a cheque account that does not require any credit facility goes through the same grueling process.

To be continued – These narritives are part of a book being written on banks by the author and is a lighthearted but very serious relay of what is actually going on with the business of the guys that should be looking after your money ( You only think it is still yours – They have misappropriated some of it to their advantage long ago)





*http://bewarethebul.blogspot.com/2010/11/un-human-factor.html

The Banking code of conduct

The banks in South Africa adheres (or so they say) to the banking code of conduct of The Banking association of South Africa.
 Full details available here:  http://www.banking.org.za/consumer_info/code_of_banking/code_of_banking.aspx

Does this give clients a warm and fuzzy feeling ?  Of course !  They just do not know that this is all a big BS story.  It is Bull and the banks know it !

THE following has been copied from the introduction of the Code :

None of the provisions of this Code:
will be legally binding in any court of law;
may be used to influence the interpretation of the legal relationship between you and your bank;
will give rise to a trade custom or tacit contract or otherwise between you and your bank.

Still feeling warm and fuzzy ?  If you do it is caused by the wool that has been pulled over your eyes.

The (un) human factor

It is a fact of life that humans (as we know them) like to think they are in control. The masters of the universe.
Of course we are, We even create our own universes and then these universes start controlling us.Banks are a classic in this regard.  They create systems which is to be followed to the nth degree.  Whether you are the client or the servant (just another name for staff member)
A case in question:  Ask any bank employee (and I mean anyone) to explain to you how they calculate interest on what you owe them.   In detail off course.  I have not met one that can do that!  "There is system sir.............You cannot challenge  it, as it was created by the ultimate fundis! (sir). It is Dogma in the bank"  (see definition of Dogma)

About systems .   It will control every action of every staff member - there is just sooo much information that any bank employee can comprehend .  No matter what the law says - do as the bank says!   Rule one......The client is always right.  Rule 2. Whenever a staff member is involved disregard rule one.   Rule 3.  When it seems that the client is actually right, see rule 2.     Rule 4.  When it seems that the client is really getting the best of the argument, act dumb and run like hell to get an expert(which does not exist in the bank anymore - so just do not come back till you find the elusive expert)

Full details of an actual case can be had by sending me an email ( email address : bankdumbness@brandow.co.za)

BEWARE BANK ADVERTISEMENTS !

Never ever trust Banks.  They do not have your well being at heart.  This morning in the Rapport newspaper there was another article where the following came out : "Irrespective of the fact that I was negotiating with the bank (FNB) and during that process they attached and sold my house on auction"   Is this an isolated incident?   You can bet your life on it that is not.  My own experience just last month is another.  My bank (ABSA) was in possession of a bank guarantee from a buyer of my property (Please note a bank guarantee - not just the possibility of something - an actual guarantee! ) they still issued summons against me - resulting in me defending the action.  Normally they would see this as a mistake but what do you think happened ? When I defended they tried to apply for immediate judgment. If I was just another ignorant client ( of which they have millions) I would have been the loser.

Suddenly the last few days the banks (apparently in conjunction with the National Credit regulator ) has started an advertising campaign inviting clients in distress with their debt to SPEAK TO THEIR BANKS!

Fall for this trick at your peril !  Beware what they ask you to sign - SIGN nothing ! and I mean Nothing!  Do not make them promises that you know you cannot keep.  Do not sign anything !
If you even consider speaking to them take a debt counselor or an attorney with you - Rather pay an attorney this one time - You will not be sorry.

If I had the money I would put full page advertisements in the Newspaper to warn people against this very evidently new trick to repossess, get quick judgements, defraud clients and I can think of a few other words actions of the BANKS.

Banks will have to clean up their acts before clients in distress can TRUST THEM !

O what a circus

The latest embarrassment for the government is the inability to launch two highly publicised pieces of legislation – the Companies’ Act and part of the Consumer Protection Act.


The musical “Evita” contains a song called “Oh what a circus” which contains a number of lines, apart from the title, that apply to this and other pieces of legislation which were pushed through with undue haste and total disregard for its wider impact:

Here's the quote from that song:

She didn’t say much but she said it loud (reminds me of someone else of the male persuasion who crawled out of the woodwork in the last year or so)
Falling over ourselves to get all of the misery right
As soon as the smoke from the funeral clears we're all gonna see and how, she did nothing for years
That's all they wanted, not much to ask for but in the end you could not deliver
That's a pretty bad state for a state to be in
Instead of government we had a stage



Quoted from Paul Kruger - Monstone compliance

Unwanted emails

S P A M   -  Where did the word come from ?
There is some debate about the source of the term, but the generally accepted version is that it comes from the Monty Python song, "Spam spam spam spam, spam spam spam spam, lovely spam, wonderful spam…" Like the song, spam is an endless repetition of worthless text. Another school of thought maintains that it comes from the computer group lab at the University of Southern California who gave it the name because it has many of the same characteristics as the lunchmeat Spam:


Nobody wants it or ever asks for it.


No one ever eats it; it is the first item to be pushed to the side when eating the entree.


Sometimes it is actually tasty, like 1% of junk mail that is really useful to some people.

I like the lunchmeat spam one - like it says some of these emails could actually be worth something if it came as something you asked for.

A case in question is the following :  I received an email from a guy called Trevor Ketler from a company called Trevor Ketler Presentations.  They might be good at what they do and reading through an article called "Ten steps to sell you"  they  go on to promote steps you can take to get people to take you seriously.  Great stuff !  Except they did not take anything seriously by sending this to me in a SPAM mail.

O, it was disquised as a serious piece of mailing by inserting the following words:

 “You have recently being referred to us from past delegates or our referral system and we take pleasure in forwarding your first Newsletter”. 

Now this is Bull...  If there actually was such a person why would they not identify him/her ?

Why did they not address me by my first name in the first paragraph ?

Amongst the steps quoted in the article the following caught my eye ( Especially because they did not take cognisance of their own steps) :

1. Know the person:

Find out what the needs of the person are and why they want to deal with you.
(How can this happen if they do not even know who their audience is ?)

5. Have the right words for the right person:

Every person dealing with you has different needs – so ensure that you are pitching around those needs.
What needs ?

7. Get the person emotionally involved:

If it ’feels’ good to the person he/she will make the decision to buy-in to your ideas.
The only emotion the mail stirred in me was irritation - This was no better than the guy at the robot wanting very seriously for me to open my window to take his flyer.

Now take note of the following when you send out emails :  If you do not know the person on the other side DO NOT SEND AN EMAIL.  If you ever want to be taken seriously get to know the person on the other side - preferably in person.  How do you do this _ Get involved in business networking - serious ones , not MLM ! Local Chambers of commerce has networking events - collect business cards - I am a serious collector and have around 1000 reasonably recent ones and have met every single person whose card I have. It is now very easy to say  : Trevor , I met you at the cocktail on Thursday - here are some more details on what we do............"   No offence given or taken - no spam - a personal email !


These and other serious marketing tips and tricks are going to be discussed at our Marketing workshop on the 6th in Centurion. - We have some great names in the marketing world that will discuss these and other serious marketing stuff !   You must be there to experience it !   Send me an email for an invite - Oh and please address me by my first name:   JOHN!

How tax works

For those who understand, no explanation is needed.

For those who do not understand, no explanation is possible.
(Thanking  Paul Kruger of Moonstone compliance for this wisdom !)


Suppose that every evening, 10 men go out for beer and the bill for all ten comes to R100. If they paid their bill the way we pay our taxes, it would go something like this:


The first four men (the poorest) would pay nothing.

The fifth would pay R1.

The sixth would pay R3.

The seventh would pay R7.

The eighth would pay R12.

The ninth would pay R18.

The tenth man (the richest) would pay R59.


So, that's what they decided to do....... The 10 men drank in the bar every evening and were quite happy with the arrangement, until one day, the owner said, "Since you are all such good customers, I'm going to reduce the cost of your daily beer by R20".

Drinks for the 10 men would now cost just R80.

The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free. But what about the other six men, the paying customers - how could they divide the R20 windfall so that everyone would get his fair share? They realised that R20 divided by six is R3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man's bill by a higher percentage the poorer he was, to follow the principle of the tax system they had been using, and he proceeded to work out the amounts he suggested that each should now pay.


Therefore, the fifth man, like the first four, now paid nothing.

The sixth now paid R2 instead of R3 (33% saving).

The seventh now paid R5 instead of R7 (28% saving).

The eighth now paid R9 instead of R12 (25% saving).

The ninth now paid R14 instead of R18 (22% saving).

The tenth now paid R49 instead of R59 (16% saving).


Each of the six was better off than before. And the first four continued to drink for free. But, once outside the bar, the men began to compare their savings.

"I only got a rand out of the R20 saving," declared the sixth man. He pointed to the tenth man, "but he got R10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a rand too. It's unfair - he got 10 times more benefit than me!"

"That's true!" shouted the seventh man. "Why should he get R10 back, when I got only R2? The wealthy always win!"

"Wait a minute," yelled the first four men in unison, "we didn't get anything at all. This new tax system exploits the poor!"
The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists, labour unions and government ministers, is how our tax system works. The people who pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.

David R. Kamerschen, Ph.D. Professor of Economics.

For those who understand, no explanation is needed.

For those who do not understand, no explanation is possible.

Grumpy people

I think it is time for some light heartedness- so let't talk about something lightly (is that the right phrase?- whatever.

I was going to say grumpy old men but then I remembered that women can also be grumpy and old . I was going to say grumpy old people and then it struck me : Nowadays it is the young(er) ones that can be grumpy as hell.
As one grow older (I did not say old) one finds that you get grumpy for all sorts of reasons.  I find it in traffic and have to constantly talk to myself about this.    Only this morning a woman in a BMW cut in front of me and I immediately got on the hooter.   Now you have to hear the hooter on my car. It lifts you out of your seat even when you drive a BMW. (Oh I haven't said it yet - I despise BMW drivers because they think they own the road.)  If you drive one and you get to sit on my rear end you are in for a treat. I will brake for no reason every few seconds until you find that I do not like you on my rear end.    When the road is open you might find it hard to get past me (You might succeed if you have a really fast Beemer).  Anyway - this poor women was scared out of her wits and in her panic nearly made an accident. This was when I realized : I am also a grumpy person ( also note that I didn't say "old" or "man" ) Even though the whole incident was actually her fault - she really cut in front of me with no indication whatever and if I didn't have all those fancy
anti-skid, abs and a few other things I just might have hit her.  But beside the satisfaction of seeing her reaction to my hooting I could have caused an accident.

So what am I on about ?  I will try not to be so grumpy in traffic anymore - anyway for now until tomorrow.

Isn't this how life works anyway ?  Resolutions only last a few hours !

Quo vadis USA ?

Not Just a Another Greek Tragedy


The Greek bond market crisis can be summed up quite simply - too much debt, too
much spending, not enough revenues. Riots, 15% interest rates and slashed budgets
are the results, so far. And the Greeks are not alone. Spain and Portugal just had
their debt downgraded by S&P and Italy and the UK are teetering. But we live in
America and problems like that don’t happen here... Right?

The US is more like Greece than you know...

The table at the bottom of this paraghraph is from a recent report entitled “The Future of Public Debt.”  published by the Bank for International Settlements (BIS). It is an analysis of the
relationship between a country’s debt, their deficit and their GDP. The higher the
debt to GDP ratios, the worse the fiscal situation. This is because the cost of
servicing the debt can cause a drain on the economy.

Greece’s Fiscal Balance (Budget Deficit) is -9.80% of
GDP, while America’s is -10.70%. Of the countries listed,
only Ireland and the UK have worse Fiscal Balances than
the US for 2010. Most countries listed are expected to
reduce their deficits slightly in 2011.

Currently, Portugal and Spain are being targeted by the
bond vigilantes, even though they are in obviously better
fiscal condition than the US. One has to wonder when it
will be America’s turn to have to deal with an imploding
bond market. The BIS puts it more succinctly - “This leads
us to conclude that the question is when markets will start
putting pressure on governments, not if.”

By “putting pressure on governments”, what they mean is a
decline or collapse of the bond market. Interest rates
skyrocket, ballooning the cost of carrying the debt. This
forces a government, as it is with Greece, to face their fiscal problems and put their
house in order.

The reaction so far in Greece has not been a pleasant one. In fact, the people have
rioted. It seems they would prefer not to give up any of their government services,
nor would they like to pay more in taxes to pay for said services.

The Greek government’s and the EU’s response comes directly out of Greenspan’s
playbook - They are borrowing more money! They can’t afford the debt they
currently have, so adding more debt must be the solution!

Fiscal Situation and Prospects

as a percentage of GDP

               Fiscal Balance                        Gen Govt Debt

                 2007 2010 2011            2007 2010 2011

Germany 0.2     -5.3  -4.6               65     82     85

Greece   -4.0    -9.8 -10.0            104     123    130

Ireland    0.2   -12.2 -11.6             28       81      93

Italy       -1.5     -5.4   -5.1            112    127    130

Portugal -2.7    -7.6   -7.8              71       91     97

Spain      1.9     -8.5  -7.7              42       68      74

U K       -2.7   -13.3 -12.5             47        83     94

USA      -2.8   -10.7 -9.4               62        92     100

Asia        0.1 -3.5   -3.6                37        40       41

Asia is China, Hong Kong, India, Indonesia, Korea, Malaysia, the Philipines, Singapore and Thailand

Sources: IMF; World Economic Outlook, OECD, BIS; Format: CIS

1


Dollar Printing Press


The Federal Reserve has made it clear that their number one
solution to whatever ails an economy is more money, more
money and more money, in that order!

The Fed pumped trillions of dollars into the system (bailing out
banks, brokerages and mortgage companies) to try to keep the
economy from collapsing in 2008 and 2009. This influx of
liquidity filled holes in bank balance sheets and, thanks to some
questionable changes in accounting rules, banks get to keep poor
and non-performing loans on their books at fictitious valuations.

The Fed also gave away another few hundred billion to the
insurance companies. The FDIC has a blank check to bail out
anybody they see fit. The Fed gave the mortgage industry a
Christmas present when on Christmas Eve 2009, they gave
Fannie Mae and unlimited line of credit. The autos have
received hundreds of billions and who knows who is next

Since the beginning of the Financial Crisis, the Fed has
pumped almost $1.3 trillion into the banking system to keep
it from failing. About $500 billion went in after the official
end of the recession.
Source: Federal Reserve; Format: CIS

 
Get ready for inflation


Since the early 1980’s, inflation has been tame, so interest rates have been declining.
But now both internal and external forces are converging to create inflation like we
have never seen before.

Inflation can be caused by too many dollars chasing too few goods or raw materials.
America has created too many dollars thanks to the Fed’s actions, and global
consumption is driving up the cost of various hard assets and resources.

The BLS recently reported that that food and energy inflation was up 18.70% year
over year as of March 2010. Yet, the core inflation rate was only 1.30% for the same
period. Core inflation does not include food and energy. I guess the

BLS doesn’t consider them essentials. So those of you that were
concerned about the 18.70% increase in food and energy since

March 2009, you really have no worry, as long as you don’t use
either food or energy.

The global consumption boom, while not straight up, will likely
continue for several decades due to urbanization trends in many
emerging nations. Regardless of the economic situation in America,
the global demand for resources will likely continue unabated. This
should drive prices up for Americans, even in a slow growth or
recessionary domestic economy. America is not the driver of
commodity prices, it is foreign consumption.



Extracts from an article by
John J. Riley

Chief Strategist
johnr@cornerstoneri.com

Cornerstone Investment Services LLC
full text here:
http://api.ning.com/files/*a4r05MtyolrNBP2bKtJdVI2LoanRo1*dqCeONXnDOKBmXGHYTr1exq4i4dOwgwbx7pZlVP4pD0T7NlDGT1mQTAYGFRrh6NI/GreekTragedy.pdf