Gill Marcus: Overview of the South African economy
Address by Ms Gill Marcus, Governor of the South African Reserve Bank, at the
91st ordinary general meeting of shareholders, Pretoria, 30 June 2011.
* * *
Dear Shareholders,
Members of the Board,
Deputy Governors,
Ladies and Gentlemen
The business of an ordinary general meeting (OGM) of the Bank is to receive and discuss
the minutes of the previous meeting, the financial statements for the preceding financial year,
the report of the Board on the state of affairs and business of the Bank, the auditors' report,
to attend to the election of directors and to attend to the appointment of auditors and the
approval of their remuneration (this being referred to as the ordinary business of a general
meeting).
In addition, special business of which proper notice was given, may be transacted at the
general meeting. This special business would be resolutions proposed by shareholders that
relate to the ordinary business of a general meeting.
As in recent times the conduct of special business has been an issue at general meetings, it
is necessary to record that special business is not any business that shareholders wish to
raise relating to the Bank and/or criticism of reports or documents presented at the general
meeting. It must clearly relate to the ordinary business of a general meeting referred to
above and must, more particularly, be framed as a resolution that is capable of being
implemented, if adopted.
Business framed as criticism or demanding action on behalf of the Bank and which does not
relate to the ordinary business of a general meeting as referred to above does not constitute
special business.
In addition, matters relating to legislation under which the Bank operates and the
requirements thereof are matters that do not constitute special business and are incapable of
being implemented by the adoption of a resolution. These are matters that ought to be raised
with the National Treasury and Parliament.
Criticism of the reports and documents presented at the general meeting does not in the
normal course of business qualify as special business, unless properly framed as a
resolution that is capable of being adopted. Any criticism, or for that matter queries, relating
to reports and documents presented at the general meeting is properly dealt with and
addressed at the general meeting as part of a discussion around these reports and
documents. And this is the basis on which we intend to conduct the business of this meeting.
The Bank was founded at a time of great turmoil in the international monetary system and
amid vigorous debates about the appropriateness of a return to the gold standard. In that
context the Bank was established to ensure that the banknote issue was in line with the gold
stock; in other words, the Bank had to ensure the convertibility of the currency or the
maintenance of the value of the currency.
The early 1920s were also characterised by a high degree of capital flows and exchange rate
volatility, and ultimately the 1929 collapse of Wall Street ushered in the worldwide Great
Depression of the 1930s.
Today, we unfortunately find ourselves in a very similar context. The global financial crisis,
which is now in its fourth year, and persistent global imbalances and volatile capital flows
have again put the nature of the international monetary system and the international
adjustment mechanism at the centre of the debate on global reform. Such turmoil and
periodic systemic crises - in this instance the most devastating since the great depression -
underline the need for strong central banks to be beacons of stability.
Our focus therefore continues to be on stability, which includes price stability, financial
stability and the stability of the banking system. Such stability is essential to providing an
environment conducive to economic growth and employment creation.
Global developments have continued to impact on our domestic economic conditions and
policy environment. The recovery in the advanced economies, which had appeared to be
more sustained, has become increasingly uncertain in recent months. While some view this
as a "soft patch" from which countries will emerge fairly soon, there are still significant risks
emanating from some peripheral countries in Europe in particular. These risks have the
potential to derail the already slow recovery in the advanced economies and to have serious
negative global repercussions.
Although countries such as Greece, Ireland and Portugal are relatively small in the European
context, the exposure of the banking systems of the rest of Europe to these countries' debt
means that in the event of even a partial default, a systemic banking crisis could ensue. And
notwithstanding the measures taken through initiatives such as Basel III, and an increased
focus worldwide explicitly on financial stability, the possibility of a systemic banking crisis
emanating from Europe cannot be dismissed.
While I do not want to overburden you with numbers, it is important to use some examples
for illustrative purposes. According to the European Commission, the debt to GDP (Gross
Domestic Product) ratio of Greece is expected to increase to 166 per cent in 2012, from
142 per cent in 2010. Its fiscal deficit is expected to decline from 10,5 per cent to
9,3 per cent. In Ireland, the debt to GDP ratio is expected to increase from 96 per cent in
2010 to 118 per cent in 2012. It is argued by some that in the case of Ireland it is more useful
to look at the debt to GNP (Gross National Product) ratio, which stands at around
150 per cent. The fiscal deficit of 30,3 per cent in 2010 is expected to decline to 8,5 per cent
in 2012.
Portugal's debt to GDP ratio is expected to increase from 93 per cent in 2010 to 107 per cent
in 2012, while austerity measures envisaged are expected to reduce its fiscal deficit from
9,1 per cent to 4,5 per cent next year - that is, to be cut in half in two years.
According to Bank for International Settlement (BIS) data, the total exposure of foreign banks
to Spain, Greece, Portugal and Ireland was around US$2,3 trillion at the end of 2010, with a
significant portion of the exposure being to German and French banks. There is also a
difference in exposure to the different countries, for instance the United Kingdom (UK) banks
have an exposure of US$190 billion to Ireland.
The International Monetary Fund (IMF) estimates that the European banks have an exposure
to the periphery of around 10 per cent of Europe's GDP, and about 80 per cent of the capital
of European banks.
These growing uncertainties have resulted in periodic changes in risk perceptions in the
international financial markets, resulting in continued volatility of exchange rates and capital
flows. The tragic events in Japan earlier in the year also underlined the fragility of the
recovery in the advanced economies.
At the same time, the strong recovery in most of the emerging markets, and Asia in
particular, coupled with unfavourable weather conditions and political developments in the
Middle East and North Africa, has put upward pressure on commodity prices, in particular oil
and food. This has led to an end of the benign global inflation environment which had
prevailed since the onset of the financial crisis.
At the risk of over-emphasising the deteriorating situation in Europe and the United States, it
must be cause for concern when, within the space of a week, three of the world's leading
central bankers - Ben Bernanke of the Federal Reserve, Jean-Claude Trichet of the
European Central Bank (ECB), and Mervyn King of the Bank of England - all explicitly stated
their concerns that the recovery from the financial crisis will be very slow, that there are real
risks to the European banking system, and that this situation poses a great threat to financial
stability.
It is within this fragile global outlook that the domestic economic outlook should be
considered. Since March 2010, domestic inflation has remained within the target range of
3-6 per cent. CPI inflation reached a recent low of 3,2 per cent in September 2010, but has
since increased to 4,6 per cent in May. This benign inflation environment enabled the Bank
to reduce the repurchase rate to 5,5 per cent, which is the lowest nominal level of the policy
rate in over 30 years. Real rates are also significantly below their long-run averages.
The accommodative stance of monetary policy has been maintained, given the relatively
hesitant nature of the domestic recovery. There are signs that this recovery is becoming
more self-sustained, following the 4,8 per cent annualised growth rate recorded in the first
quarter of 2011, driven mainly by a strong performance in the manufacturing sector.
However, the fragility of this recovery is illustrated by the contraction in the manufacturing
sector recorded in April 2011 and the continued slow pace of growth in the construction
sector and in private-sector fixed capital formation. Employment growth has also remained
subdued.
Although there are no signs of pressures on domestic inflation generated from the demand
side of the economy, the inflation outlook is being adversely affected by global commodity
prices. As a result of these developments, inflation is expected to breach temporarily the
upper limit of the inflation target range in the first quarter of next year, and then remain close
to the upper end of the target range for the rest of the year.
The Monetary Policy Committee (MPC) will continue to monitor closely any indications of
second-round effects on inflation emanating from these cost pressures. We will continue to
give primacy to our objective of price stability, and implement monetary policy within a
flexible inflation-targeting framework.
The policy challenges we face are complex. While data at one level may suggest an upside
risk to the inflation outlook and a possible change in the interest rate stance, other data may
well indicate a need for the opposite policy approach. In times of such great uncertainty it is
important for a central bank to remain focused on its primary responsibilities, but vigilant and
aware of what is happening in the global and domestic economic environment.
The financial crisis has focused attention on financial stability issues. In the past most central
banks had implicit financial stability mandates and the conventional wisdom was that price
stability would ensure financial stability. The crisis has shown that financial stability should be
seen as a separate objective, and a number of central banks have been given explicit
financial stability mandates.
The Bank has also been given a mandate to take a leading role in maintaining financial
stability. To this end, the Bank's Financial Stability Committee (FSC) has been reconstituted
and given responsibility for macroprudential oversight and policy implementation. This is
unchartered territory, and work is being undertaken both globally and domestically to
determine the exact nature of such oversight as well as what appropriate policy instruments
could be.
Without being complacent, our view is that at this stage there are no obvious threats to
domestic financial stability: credit extension by banks is subdued and there is no evidence of
incipient asset market bubbles. However, we remain vigilant as to the possible impact of any
global financial stability or systemic banking matters that might arise.
The Bank's microprudential responsibilities have also been impacted by global developments
with respect to the regulatory and supervisory environment. The Bank, as a member of the
Basel Committee on Banking Supervision (Basel Committee), has been an active participant
in the deliberations on banking regulatory reform. Meetings of the committee have
culminated in the publication of the global regulatory framework for more resilient banks and
banking systems, known as Basel III, which incorporates the details of global regulatory
standards on bank capital adequacy and liquidity.
The changes should not have a material impact on South African banks which remain well
capitalised and characterised by low leverage ratios. The proposals regarding liquidity are
likely to pose a greater challenge, and it is important to recognise that it is not only
South Africa that faces this hurdle. Given the relatively long phasing-in period allowed, these
challenges are not viewed as being insurmountable.
Capital flows to a number of emerging markets moderated in the final quarter of 2010 and
early 2011. A similar pattern was observed in South Africa, and between November 2010
and March 2011 there were cumulative net sales of bonds and equities by non-residents.
More recently, renewed net purchases have been experienced and year to date the net
purchase of bonds and equities stands at approximately R27 billion.
Despite this relatively volatile pattern of capital flows the Bank, with the assistance of
National Treasury, has continued with its policy of Foreign-exchange reserve accumulation.
In the 2010/11 financial year the Bank purchased approximately US$10,3 billion for this
purpose. The need to sterilise the impact of these purchases of foreign exchange on
domestic liquidity resulted in the Bank reporting an after-tax loss for the second consecutive
financial year, amounting to a little under R1,2 billion.
Having given a brief outline of the global and economic outlook, let me now address a
number of questions raised by various shareholders during the three shareholder road shows
held in Pretoria, Durban and Cape Town in the run up to this meeting.
I would also like to thank all shareholders who attended these road shows, and encourage
others to take advantage of this opportunity for more in-depth interaction next year.
Question 1 - The losses incurred and explanation of Gold and Foreign Exchange
Contingency Reserve Account (GFECRA)
The Bank acquires foreign exchange for reserves accumulation purposes, and in the process
injects rand liquidity into the domestic money market. In order for domestic money-market
conditions to reflect the prevailing monetary policy stance as determined by the MPC, such
liquidity needs to be sterilised (or drained) from the system. This is done, inter alia, by
openmarket operations conducted by the Bank by way of issuing SARB debentures, and
conducting reverse repurchase transactions. These transactions, which effectively amount to
a borrowing of rands, are undertaken, in terms of cost, at or around the repo rate which is
currently 5,5 per cent per annum.
The foreign currency that is purchased is then invested in different currencies, that is, in
US dollars, euros and pound sterling. In the current difficult economic climate, these
investments generally earn low rates of return, currently below 1 per cent per annum.
This negative interest rate differential has resulted in the R1,16 billion loss reported in the
Annual Report
2010/11. Unrealised and realised fair value gains and losses on financial
assets and financial liabilities are also included in the interest income line item and are for
the account of the Bank.
The losses incurred, as in 2009/10, were covered by drawing down on the contingency
reserve, which declined from R9,1 billion to R7,94 billion for the Bank. Once the Bank returns
to profitability, there will be a need to rebuild the contingency reserve, and reconsider the
level that this should stand at taking account of recent experience.
It is important to point out that the losses were incurred in the execution of the Bank's public
duties and do not in any way relate to operational deficiencies or undue risks being taken.
The Bank has a sound risk management framework, a disciplined budgeting process, and
prudent expenditure management.
Gold and foreign exchange contingency reserve account
The Gold and Foreign Exchange Contingency Reserve Account originates from sections
25 to 28 of the SARB Act. The GFECRA consists of three sub-accounts which reflect the
following transactions:
(a) Gold price adjustment account
All profits and losses on gold holdings arising from price fluctuations and revaluation
movements are recorded in this account.
(b) Foreign-exchange adjustment account
All revaluation profits and losses on foreign assets arising from exchange rate
movements against the rand are recorded in this account.
(c) Forward exchange contracts adjustment account
All revaluation profits and losses arising from exchange rate movements against the
rand on outstanding commitments in the forward Foreign-exchange market and
foreign currency - denominated liabilities of the Bank are recorded in this account.
All the above amounts are for the account of Government in terms of the SARB Act.
Settlement of this account is subject to agreement between the Bank and Government. The
current arrangement is that only transactions that have affected liquidity in the South African
money market will be settled.
Question 2 - Reserves management and holding thereof, including the issue of
US dollar vs gold
While South Africa follows the international convention of reporting official reserves in
US dollars, the portfolios of reserves are diversified in approved currencies which
predominantly comprise US dollars, euros and pound Sterling. The notes to the financial
statements (Note 29 on page 98 of the Annual Report) give an indication of the extent of
currency diversification.
Gold reserves constituted approximately 12 per cent of total official reserves at the end of
March 2011.
The Bank has held around 4 million fine ounces of gold for some time, and when such
holdings are reviewed account is taken of both the cost of acquiring further gold reserves and
any returns that could be earned from owning more gold.
The Bank has adopted a conservative and prudent approach to investing the reserves,
guided by a clear governance framework and investment policy. The investment policy
captures the objectives, rationale and the risk tolerance of the Bank for holding these
reserves. The inherent risks in reserves management are mitigated by well-defined
investment guidelines.
Question 3 - Clarification of certain aspects of the remuneration of directors (Note 30
on page 102 of the Annual Report)
The remuneration of directors for the year ended March 2011 reflects a general adjustment
of 6 per cent over the amounts paid for 2010. In addition, the amounts paid in 2011 include:

an "arrears adjustment" of 3,1 per cent in respect of the 2009/10 financial year. In
keeping with a decision taken at the start of the 2009/10 financial year that the
increase be inflation outcome linked, Board members were paid only an interim
adjustment of 3,4 per cent, on the understanding that the balance would be paid
once the inflation-outcome for that year was known. Consequently, the "arrears
adjustment" was paid in the 2010/11 financial year with the resultant percentage
increase distortion;
 payments for service as chairpersons and/or members of Board committees, and
changes in the composition and chairpersons of the Board committees between the
2010 and 2011 financial years. This implies increases in retainers and attendance
fees;

the establishment of the Board Risk Committee on 25 February 2010, which
resulted in payments to the Chairperson and members of this committee during the
2011 financial year, compared to the previous financial year when the committee
was in existence for only one month, and hardly any payments were made;

an above-average increase in the remuneration of Dr X P Guma with effect from
29 May 2010 owing to his appointment as Senior Deputy Governor from that date;
and

an above-average increase in the remuneration of Prof R W K Parsons for services
as non-executive director of a subsidiary owing to the fact that he served for a
longer period than before in such capacity during the 2011 financial year. He also
served on one additional Board committee of the subsidiary during the 2011
financial year.
Question 4 - Code of ethics
The Code of Ethics was adopted by the SARB Board in February 2010, and has been part of
internal discussions throughout the Bank. It will be published on the Internet in due course,
together with a comprehensive value statement that is being developed throughout the Bank.
Question 5 - Additions to property, plant and equipment
A question was raised with regard to the additions in plant, vehicles, furniture and equipment
(Note 10.1 page 85), which has increased from R52 million in the prior year to R205 million.
It has been necessary to invest in machinery and equipment at the branches and
manufacturing subsidiaries. Going forward, we expect more such investment to take place to
ensure optimal functioning and best use of new technology to maintain both quality and
performance from the Bank and its subsidiaries.
Question 6 - Panel process and nominations
A question was asked as to whether the Bank remains satisfied with the quality of candidates
available to serve as non-executive directors on the Board. It was also said that the Panel
process is not transparent as to who has nominated the candidate, what the quality of
candidates is and shareholders have not been given the opportunity to meet and interview
the candidates for election.
The Panel was established in terms of section 4(1C) of the Act, which Act further stipulates
the process of nominating the candidates and the review process. I can confirm that
nominations were received during March 2011 from the general public and were collated by
the Secretariat for circulation to the Panel members.
The Panel met on 16 April 2011 to assess the nominations and to confirm the selected
candidates for consideration by the shareholders. In total, 84 nominations were received.
The experience and qualifications of the candidates varied, and included business people,
academics, accountants, lawyers and other professional persons. The Panel was satisfied
with the level of qualifications, skills and business acumen of the majority of the candidates,
as could be determined from the curriculum vitae (CVs) presented. Three candidates have
been identified and confirmed in each of the categories where vacancies will arise on
1 July 2011, and the Panel is satisfied that these are persons of good standing and have the
requisite knowledge and skills to fulfil the roles and responsibilities of a non-executive
director.
From reading the CVs of the nine possible candidates circulated to you, I have no doubt you
will concur that all nominees are well known in their fields of expertise and reflect the highest
standards of integrity and professionalism. Moreover, it is the responsibility of the Panel to
assess the candidates, not that of shareholders. I am not aware of any precedent in the Bank
where shareholders interviewed prospective nominees. It is also important to point out that
this process allows for the public at large to make nominations, and therefore the pool of
participants, both proposers and nominees, has been broadened. This is important as, given
the small number of shareholders of the Bank, nominations limited to them could be
construed as contrary to sound principles of central bank governance.
Question 7 - King III compliance
The Bank has been requested to expand upon its King III Code of Governance (King III)
compliance and to explain where it does not apply the recommendations as set out in
King
III, in more detail. As discussed at the 2010 (OGM), the Bank has conducted a
Bankwide gap analysis, and steps are being taken to address those areas we regard as
having room for improvement. It is necessary to emphasise that King III is a voluntary code,
and a tool for enhancing governance, which is the approach the Bank has taken.
Question 8 - Definition of corporate body
A request has been made to set out clearly the definition and status of the Bank with regard
to profitability. The SARB Act clearly stipulates that the Bank is a juristic person, with its
primary objective being to protect the value of the currency of the Republic in the interest of
balanced and sustainable economic growth. There should be no ambiguity about this matter.
The Bank does not perform its duties with a profit motive. On the contrary, in the exercise of
its responsibilities, it may well take actions that are in the national interest but will result in the
Bank being loss-making.
It is the obligation of the Bank to act in the best interests of the country, and not in the narrow
interests of the profitability of the Bank or its shareholders. There are legal limits placed on
the rights of the shareholders of the Bank - for instance a limit of 10,000 shares, a fixed
dividend, the election of only some of the non-executive Board members and no role in the
appointment of the Governor and deputy governors, among others.
Amendments to the SARB Act
The amendments to the SARB Act were promulgated in September 2010. In terms of these
amendments, membership of the Board of the Bank was expanded from 14 to 15. The Board
King III
has also agreed to use as a guideline the nine-year rule contained in for the service
periods of Board members. As a result, three new non-executive directors will be elected by
shareholders at this OGM. There are currently four vacancies for non-executive directors
appointed by Government. Once all these appointments have been made, the Board will
comprise a significant proportion of new members. While this may raise challenges for
continuity, I am confident that the new-look Board will continue to maintain effective
corporate governance oversight of the Bank.
Other changes to the Board have come about as a result of the appointment of Mr Lesetja
Kganyago as Deputy Governor, who assumed office on 16 May 2011. I would like to take this
opportunity to welcome him again to the Bank. He brings a wealth of knowledge and
experience, and his positive impact is already being felt. I would also like to take the
opportunity to bid farewell to Senior Deputy Governor Dr X P Guma who has indicated to the
President of the Republic that he is not available for reappointment when his contract expires
at the end of July 2011, after 10 years as Deputy Governor. I wish to thank him for his
service to the Bank. It is also fitting to pay tribute on this occasion to Mr Errol Kruger whose
career in the Bank spanned 34 years. As Registrar of Banks he played a critical role in
ensuring the soundness of the South African banking system. We wish them both well in
their new undertakings.
Let us now turn to the formal business of the day, which includes the following matters:
to consider the minutes of the Ordinary General Meeting of shareholders held on
Firstly,
8 December 2010.
Secondly, to present and discuss the annual financial statements and the reports of the
Board of Directors and the auditors of the Bank for the financial year ended 31 March 2011.
Thirdly, to request shareholders to elect non-executive directors, to fill the three vacancies
on the Board of Directors for persons with knowledge and skills in commence or finance;
labour; and mining.
Fourthly, to approve the remuneration of the auditors of the Bank for the past audit.
Fifthly, to appoint auditors for the 2011/12 financial year.
And finally, to consider any further business duly placed and to be transacted at an ordinary
general meeting.
The Office of the Secretary received no requests for special business to be placed on the
agenda of this meeting from any shareholders other than Mr Duerr. Mr Duerr attempted to
place some 15 items of purported special business on the agenda of this meeting, including
5 items which he attempted to place on the agenda of last year's OGM. None of the items
qualified as special business as contemplated in regulation 7.3(d) read with regulation
12.3 of the Regulations, and Mr Duerr, was in writing, together with reasons, informed of this
position. The matters addressed above during my speech do, however, cover many of the
items raised by Mr Duerr as they formed part of the ordinary business of the meeting.
Notwithstanding the above, I would like to deal with some matters relating to Mr Michael
Duerr. It is unusual to single out one shareholder, but given the extent to which Mr Duerr
claims to speak on behalf of all shareholders, and his consistent communication of all issues
raised with the Bank to a wide range of media, we feel it is necessary to put the record
straight.
Mr Michael Duerr has been a shareholder in the Bank since about March 2006. Mr Duerr is a
shareholder who does not normally reside in South Africa, and is therefore subject to the
legal provisions applicable to shareholders who are not ordinarily resident in South Africa. In
the main, the legal implication is that Mr Duerr (as is the case with all other non-resident
shareholders) cannot vote at any general meeting of shareholders of the Bank. Non-resident
shareholders, of whatever nationality, even if South African nationals, have not been
permitted to vote virtually since the inception of the Bank, and this is clearly spelt out in the
SARB Act. Mr Duerr should have been aware of this and other limitations on shareholders at
the time he bought the Bank's shares. However, Mr Duerr refuses to accept that the SARB
Act lawfully prohibits persons who do not ordinarily reside in South Africa from voting, and he
has raised issues with regard to the enforceability of this measure with the Bank on
numerous occasions.
We have spent literally hundreds of management hours responding to often spurious,
slanderous and sometimes downright bizarre interventions by Mr Duerr. The Bank's Legal
Counsel and his team have spent some 385 hours since the middle of last year just
responding to his queries. We have received more than 60 e-mails and other
correspondence, running to more than 160 pages. Apart from the tone, language, unfounded
allegations and abuse contained in this correspondence, there have been no less than
61 demands, often stipulating responses expected within hours. By any standards, this is not
in the interest of good governance or efficient or effective operations.
We have reflected the hours spent by the Legal Counsel, but the interaction also takes up
the time of the Governors, the Secretary of the Bank and the Head of Strategy and
Communications. We can only conclude that harassment appears to be the actual intention,
which is most unfortunate and hardly a good reflection on Mr Duerr, who claims that in these
actions he is the "caretaker shareholder" acting for all shareholders. In this way he ostensibly
abrogates to himself powers that can never be his, and seeks in the process to disempower
the vast majority of shareholders by evidently suggesting that he speaks in your name.
Allow me to quote from some of the public statements that have been made by Mr Duerr.
On 2 March 2009 Mr Duerr forwarded an article titled "The Central Bank Hunter", which had
been published in an overseas publication styled "Börse Online", to the Bank. It consisted of
an interview with Mr Duerr in which he, among others, made the following statements:
(a) he had stumbled upon the astonishing fact that the Bank (being a central bank) was
100 per cent privately owned, and started buying himself into the organisation;
(b) in order to side-step/circumvent the limitation of half a per cent of the issued shares
that may be owned by a single shareholder, he ordered shares in the name of family
members to their personal limit, resulting in his wife, children, parents and
parentsin-law becoming part of the deal;
(c) his family held about five per cent, his personal friends an estimated five per cent
and partners who had joined the business owned an estimated five to ten per cent of
the Bank's shares;
(d) this business was not expensive for him, measured against the two million issued
shares and their value expressed in euros;
(e) his initial purpose for buying the shares, namely to prevent the erection of a nuclear
power plant near his property, had been superseded by an approach of achieving
the maximum possible return on capital from his investment;
(f) in his opinion it would amount to R4 206 per share and this would be most easily
achieved through nationalisation of the Bank as in such an event shareholders
would be entitled to 40 per cent of the reserves of the Bank;
(g) he was persisting in his attempts to acquire more Bank shares; and
(h) from his side he wanted to increase the pressure on the central bank and threatened
to pass on shares under his influence to the Chinese or the Indians. In this vein he
pointed out that there are many investors who would be prepared to pay millions in
order to have access to a political lever.
In various