Grocott's Mail
    Facebook Twitter Instagram
    Friday, June 13
    Facebook Twitter Instagram
    Grocott's Mail
    • NEWS
      • Courts & Crime
      • Features
      • Politics
      • People
      • Health & Well-being
    • SPORT
      • News
      • Results
      • Sports Diary
      • Club Contacts
      • Columns
      • Sport Galleries
      • Sport Videos
    • OPINION
      • Election Connection
      • Makana Voices
      • Deur ‘n Gekleurde Bril
      • Newtown… Old Eyes
      • Incisive View
      • Your Say
    • ARTSLIFE
      • Cue
        • Cue Archives
      • Makana Sharp!
      • Visual Art
      • Literature
      • Food
      • Festivals
      • Community Arts
      • Going Places
    • OUR TOWN
      • What’s on
      • Spiritual
      • Emergency & Well-being
      • Covid-19
      • Safety
      • Civic
      • Municipality
      • Weather
      • Properties
        • Grahamstown Properties
      • Your Town, Our Town
    • OUTSIDE
      • Enviro News
      • Gardening
      • Farming
      • Science
      • Conservation
      • Motoring
      • Pets/Animals
    • ECONOMIX
      • Business News
      • Entrepreneurship
      • Personal Finance
    • EDUCATION
      • Education NEWS
      • Education OUR TOWN
      • Education INFO
    • EDITORIAL
    Grocott's Mail
    You are at:Home»Uncategorized»Economic crisis is about a deficit of trust – Marcus
    Uncategorized

    Economic crisis is about a deficit of trust – Marcus

    Grocott's MailBy Grocott's MailOctober 11, 2012No Comments3 Mins Read
    Facebook Twitter Pinterest LinkedIn Tumblr Email

    “Don’t tell us we can’t produce welders,” said Reserve Bank Governor Gill Marcus in a lecture to students and high school pupils at Rhodes University on Wednesday. Commenting on what she described as a major structural problem in the South African economy, Marcus said that in spite of widespread unemployment, we have more than 60 000 unfilled vacancies for skilled artisans such as welders. 

    “Don’t tell us we can’t produce welders,” said Reserve Bank Governor Gill Marcus in a lecture to students and high school pupils at Rhodes University on Wednesday. Commenting on what she described as a major structural problem in the South African economy, Marcus said that in spite of widespread unemployment, we have more than 60 000 unfilled vacancies for skilled artisans such as welders. 

    She remarked that while there are many highly skilled people on the market, our education system is not directing young people into professions where they are needed. Marcus said that this country needs to improve its growth rate to at least 7% in order to eliminate poverty, but noted that this is a difficult target in the light of the international financial crisis.

    She pointed out that although South Africa has weathered the brunt of the crisis rather well, recent political developments have left this country more vulnerable than it was six months ago. She cited the recent fall in the rand’s value and the large amounts of investor funds that have left our shores as evidence of this growing vulnerability.

    The widely publicised strikes and particularly the violent confrontations at Marikana have severely undermined confidence in the future of this country, making it a less attractive investment destination. The erosion of confidence was a key factor in the withdrawal of investments, but it was not the only one.

    The reflex response to the international financial crisis was for banks to bring their funds back to their country of origin. The consequence of this reaction was that countries all over the world suddenly found foreign investments being withdrawn from their markets, leaving them with localised liquidity crunches.

    The only way of coping with these domestic cash shortages was to call in their own funds from overseas markets and so exacerbated the spiralling international crisis. Marcus spoke at length about the deficit of trust as being the salient characteristic of the current crisis.

    She said that internationally trust has been undermined at various levels beginning with a lack of trust in leadership. This is followed by a lack of trust among European states as the wealthier, northern European countries do not trust those in the south to use bail-out money prudently.Thirdly there is a lack of trust between social groups called on to make sacrifices.

    Marcus added that while the above three trust deficits are critical, she chose to focus on the lack of trust in the global financial system in general and in banks in many of the advanced economies in particular.

    She said, “The importance of trust in the financial system cannot be over-emphasised, because without it the financial system breaks down and without an efficiently working financial system, the economy will not operate effectively”.

    Marcus added to the gloom by explaining that a recovery from a financial crisis takes much longer than that of other crises.

    “Unlike normal economic cycles or recessions, financial crises are protracted,” she said, because they result in loss of output, employment and tax revenues.

    Previous ArticleMadlavu slates officials’ mumbo jumbo
    Next Article Raphael Centre in dire straits
    Grocott's Mail

      Comments are closed.

      Code of Ethics and Conduct
      GROCOTT’S SUBSCRIPTION
      RMR
      Listen to RMR


      Humans of Makhanda

      Humans of Makhanda

      Weather    |     About     |     Advertise     |     Subscribe     |     Contact     |     Support Grocott’s Mail

      © 2025 Maintained by School of Journalism & Media Studies.

      Type above and press Enter to search. Press Esc to cancel.