Monday, February 1, 2010

Expediency Measures...

...are gaining steam across the globe.

Wether it be in Greece, South Africa (see article below), or amongst the G8, the proliferation of policies designed to circumvent legal safeguards in the name of expediency (typically citing the GFC as the "unprecedented" event that causes such drastic action) is troubling.

At the very least, it increases geo-political risk and makes the rules of the international game that much more difficult to forecast.

JOHANNESBURG (Reuters) - Top officials in South Africa's ruling ANC are pushing for the state to take over ownership of the country's central bank, one of the few in the world to still be owned by private shareholders, newspapers reported on Sunday.

The Sunday Times and Sunday Independent said ANC Secretary-General Gwede Mantashe had presented a document to the party's top decision-making committee questioning why the bank was still owned by the private sector.

He had argued that the party should not shy away from looking at the state's role in the banking industry as a whole.

"Why have we been reluctant to even open the discussion on the role of the state in the banking industry," the newspapers reported him as saying in the document that was supported by some executive committee members.

"Including discussing the fact that the South African Reserve Bank is one of less than five central banks in private hands in the world."

The Reserve Bank is owned by shareholders, who are entitled to appoint half of the board of directors. Shareholdings are limited and liquidity tight.

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