Ntsakisi Maswanganyi:

WHAT a great day this looks set to be for global stocks. US legislators have finally agreed to raise the debt ceiling, and also put an end to the partial shutdown of nonessential government services that have been closed since the beginning of this month.

The bipartisan leaders of the US Senate reached an agreement to end the fiscal impasse and to increase US borrowing authority, and the Senate and the House of Representatives could vote on it as soon as today.

Today is the deadline for US politicians to reach a deal to raise the debt ceiling.

Concerns over the debt ceiling and the partial shutdown were factors that have had markets all jittery and volatile for more than two weeks.

Although markets started yesterday on a weaker and volatile note, they ended higher as speculation rose that a deal to raise the borrowing limit would be struck in the world’s biggest economy.

The JSE, which closed before a deal could be announced, closed 120 points higher at 44,418.01.

If the dire consequences to world markets of not reaching an agreement on raising the debt limit would not have sent US legislators into action, the threat of a rating downgrade could perhaps have done the trick.

Fitch Ratings on Tuesday put the creditworthiness of US government debt on rating watch “negative”, but gave itself until the end of the first quarter of next year to decide whether it will actually cut the rating from AAA.

Rating agencies have lost a little bit of the high regard they enjoyed before the global banking crisis, because they continued to give good credit ratings to some US banks that were not financially in good standing.

Despite this, what these rating agencies say still matters quite a lot, because investors continue to look at a country’s rating before they put their money there.

While stocks could rally today, there is potential that currencies in emerging markets could come under some pressure as a deal to raise the US borrowing limit looks set to boost the dollar. What is happening in the US goes to show just how much rests on the shoulders of politicians.

It is the responsibility of every politician as an elected representative of the people to make sure they do things in a manner that best delivers to people and puts a country first. The same is true for SA. By the way, there are interesting developments at the moment and a lot of them are happening because parties have started putting on their running shoes to prepare for the marathon that is the general election next year. Very entertaining how all of a sudden the ward councillor you last saw almost five years ago now visits you at your home to find out what services they could deliver better to you.

Whichever party wins the elections will have the right to formulate policies which it thinks will take SA and South Africans forward. But policy is not static, it evolves every day along with an ever-changing global economy. Local politicians would do well to remember this.

With all that said, it is good to know that we are finally in the last quarter of the year. It will soon be that time again when those with crystal balls will start looking deep into them to tell us what they see happening in the coming year.

I am not sure just how much trust some of us are still willing to put in those crystal balls and those behind them, as they did not see the 2008 financial and subsequent global economic crises coming.

This year has been one of those where things had been expected to be much better, with higher rates of economic growth.

As we slowly moved deeper into 2013, things were not as rosy as the crystal balls had predicted and there were a lot of downward revisions to growth prospects. SA’s own economic growth forecast was slashed to 2% for this year from earlier projections of almost 3%. This was not unique to SA and applied to several other developed and emerging markets.

I bought a crystal ball just a couple of days ago and it seems to have some good news, at least for the last three months of this year.

The US debt issues have been sorted out, albeit only until early next year. Locally, most of the wage settlements have been reached and the economically damaging strikes are over.

We are heading towards the festive season, or should we call it the silly season, when those lucky enough still to have jobs and aboveinflation wage increases might feel the urge to spend a little more than they are now, and boost economic activity in the quarter.