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It always seems impossible until it’s done.” – former President of South Africa, Mr Nelson Rolihlahla Mandela
- “If you want peace, you don’t talk to your friends. You talk to your enemies.” – Archbishop Desmond Tutu
We explore the reasons for the sustained streak without loadshedding and discuss what we can expect heading into winter.
The series concludes with a case study on Brazil, a discussion on what sets South Africa apart from the countries discussed in this series and broad guidelines for investors on asset allocation in so-called “worst-case scenarios”.
In episode two, we ask if domestic equities will always preserve value in cases of severe countrywide decline and major macroeconomic instability.
Amidst a myriad of datapoints and a looming general election, what’s in store for the local economy heading into the second quarter of 2024? Join investment specialist Kim Deane and Economist Marie Antelme as they discuss the need-to-know highs and lows.
Our first episode features the fascinating series of events that unfolded in Argentina, Lebanon and Venezuela respectively.
“Nothing is more obstinate than a fashionable consensus. ” - Margaret Thatcher, British Prime Minister, 1979 - 1990
He who is not prepared today, will be less so tomorrow – Ovid
We look at the opportunity set offered by the JSE and why the prospects remain positive for the patient investor.
In the short run, the market is a voting machine, but in the long run, it is a weighing machine.
Mounting risk to the fiscal health of indebted emerging markets will require careful navigation.
“Give me accountability, I’ll give you peace.” – Abhijit Naskar, neuroscientist and author
Improving local economic outlook
Passing breeze or real winds of change?
But SAGBs are still an attractive investment
“The storm only comes to teach you how to skillfully sail your ship.” – Matshona Dhliwayo, author and philosopher
Good intentions and a renewed commitment to growth are not enough to make government's financial position sustainable
“Throughout human history, in any great endeavour requiring the common effort of many nations and men and women everywhere, we have learned – it is only through seriousness of purpose and persistence that we ultimately carry the day. We might liken it to riding a bicycle. You stay upright and move forward so long as you keep up the momentum.” – Ban Ki-moon
Vulnerabilities increase the risk of longer-term damage
“When the world is running down, you make the best of what’s still around.” – Musician and actor, Gordon Sumner (aka Sting)
“If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.” – Economist John Maynard Keynes
We can’t afford not doing better
“Trust is undeniably linked to doing what is right. Ethical drivers such as integrity, dependability and purpose drive the trust capital of business.” – 2020 Edelman Trust Barometer
Let us not waste another crisis
“The best time to plant a tree was 20 years ago. The second best time is now.” – Chinese proverb
Significant opportunities may underlie a bleak outlook
“A promise is a cloud; fulfilment is the rain.” – Arab Proverb
Transformative policy paper needs strong implementation
Restoring confidence is key to growth recovery
But depressed growth and further Eskom support weigh heavily on government
The price is right (or at least it feels that way)
The economic cost of rent seeking
“It does not matter how slowly you go, as long as you do not stop.” – Confucius
A good quarter for investors, but a tough one for South Africa
Government’s management of the power crisis will be telling of its broader capacity for reform
But South African bonds still offer a bulwark against global policy normalisation
“He who indulges in empty fears earns himself real fears. We should always allow some time to elapse, for time discloses the truth.“ – Lucius Annaeus Seneca
“The trouble is, you think you have time.” – Gautama Buddha
The element of surprise is common in a system where so many decisions depend on forecasts of the future.” – Iconoclastic economist Frank Knight, mid-20th century
It was always going to get messy
“You can’t always get what you want, but if you try sometimes you just might find you get what you need.” – The Rolling Stones
But after riding the wave of optimism, we are now cautious of South African bonds at current levels
South Africa’s prospects are looking better, but durable change needs vision and consensus
We continue to focus on valuation to find attractive opportunities
Cyril Ramaphosa’s ANC needs to save South Africa from economic déjà vu
Enough already!
2017 proved to be a strong year for most asset classes and our portfolios performed well over the period
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