Rational Perspective

Late on Friday, the world’s most popular cryptocurrency Bitcoin traded above $10,000 for the first time in over a year, riding a wave of optimism about the future of digital currencies.  Over the weekend, Ethiopia’s reformist government of Prime Minister Abiy Ahmed, foiled a coup attempt that killed several senior government officials, including its military chief.  Late on Friday afternoon, South Africa’s global internet group Naspers Ltd announced that it will be delaying the Amsterdam listing of Prosus NV, the newly created company which will own the group’s international internet assets.  Still with SA's global internet group, the six year old, 2.7m user cryptocurrency platform Luno, which Naspers supports, is planning to increase its workforce by more than half to expand its South African headquarters.  See omnystudio.com/listener for privacy information.

Sometimes a winner looks like a loser and a winning bet looks like a losing proposition. In SA, Multichoice has been out of favour as viewers switch to streaming, while exotic game has been seen as a modern gold mine for the savvy millionaire. But looks can be deceiving. In this episode, Alec Hogg lays out the contrarian case for investing in Multichoice and explains why the folks who bet big on buffalo and other big game are looking very wobbly today. The story of how multi-million-rand animals have depreciated into thousand-rand boondoggles is a sobering reminder of the dangers of irrational investment exuberance – a tale as old as tulip-mania. Alec Hogg and Felicity Duncan also discuss this week’s State of the Nation Address with a focus on the good news about data. See omnystudio.com/listener for privacy information.

Energy experts have welcomed the cash boost to address the debt mill stone for Eskom, but they say President Cyril Ramaphosa has not gone far enough and that he has not given enough detail. Opposition parties have accused the President of throwing money at Eskom, which had outdated organisational structures would not solve the country’s energy problems. – Linda van Tilburg See omnystudio.com/listener for privacy information.

FNB house price analysis suggests that owners of luxury properties in Cape Town are in for more disappointment, with prices likely to continue falling on the Atlantic Seaboard. Siphamandla Mkhwanazi, property economist at FNB, says a downward adjustment in property prices is likely to continue. Biznews's Jackie Cameron spoke to him.  See omnystudio.com/listener for privacy information.

South Africans sometimes forget how far we’ve come since the days of Zuma and friends. And it’s none more apparent than through the annual State of the Nation address. Before it was almost a slogging contest of how far we’d come, what we’d done, as the ANC, which over the past nine years was plenty of billions plundered. There’s a fresh air with Ramaphosa’s approach, a look at what must be done, with some of the building blocks outlined. Because there’s one thing that every South African must realise. The hole that’s been excavated by the Zuptoids will only be filled with a collective effort. It’s a long speech, but they usually are, and I’d encourage anyone that sees a bright light at the end of South Africa’s tunnel to absorb what’s been said. Because if there’s one thing Ramaphosa can do is rally the troops that see a peaceful, prosperous future for this country. And the hard work begins with Eskom… – Stuart Lowman See omnystudio.com/listener for privacy information.

In today's business headlines: President Cyril Ramaphosa has announced that the Government is going to bail out Eskom. Gold has surged to its highest level in five years after the US Fed signals turned dovish. Naspers has made its first local tech investment in SweepSouth, a cleaning service business. Group Five says shareholders are not getting anything out of the rescue process. Lord Peter Hain says the international community should bring back the money looted by the Guptas. See omnystudio.com/listener for privacy information.

Bernard Swanepoel is best known for his building of Harmony Gold, creation and host of the Joburg Mining Indaba or as chairman of the Small Business Institute. But his family also owns a farm in the arid Limpopo province where they started breeding game two decades ago. For some years Swanepoel has been warning everyone who would care to listen that the exotic game market was a bubble waiting to burst. Now that prices have collapsed, in some cases by over 90%, on Rational Radio he unpacked how the financial disaster (for many) happened. - Alec Hogg      See omnystudio.com/listener for privacy information.

Former banking executive and now private investor Dave Woollam lives in the heart of KZN where the collapse of the province's once iconic corporation Tongaat Hulett has caused huge ructions. After picking up concerns among family and friends more than a year ago, chartered accountant Woollam started investigating by looking back at financial statements of the past decade. After seeing any number of red flags, he approached the company but got short shrift from the board of directors.......Here's his story. - Alec Hogg     See omnystudio.com/listener for privacy information.

Duncan Artus, one of the key portfolio managers and director at Allan Gray, is celebrating a decision to make hay while the foreign dumping of MultiChoice was happening - delivering a quick 30% return for his investors. So strong has been Allan Gray's purchasing that the firm is now MultiChoice's second largest shareholder. On Rational Radio this week Duncan spoke about why we South African radio stations should be quoting Naspers rather than the gold price; admitted to holding about 6% of Tongaat when the company crashed; and shared what he thinks will be the JSE's winners during the next year.  See omnystudio.com/listener for privacy information.

In today's business headlines: Inflation is up slightly in May rising to 4.5% mainly driven by a 3.3% rise in fuel prices. South Africa simply has to rescue Eskom, even though it can’t afford to. That is the opinion of Bloomberg analysts. Steinhoff International Holdings is seeking another extension to restructure after a R20 billion rand loss for the year ending September 2018. In a blow to President Cyril Ramaphosa’s efforts to clean up the government a number of Zuma allies have been nominated for top posts for Parliamentary portfolio committees. MultiChoice now has more user on the African continent, than inside South Africa after its Rest of Africa business grew by 12%. See omnystudio.com/listener for privacy information.

There were many businessmen, politicians and even journalists who disengaged emotionally and some even geographically from South Africa during the Zuma years as it seemed impossible to stop corruption threatening to engulf South Africa. One of them was former National Party cabinet minister and negotiator for South Africa's new Constitution, Roelf Meyer. Following the successful diffusion of conflict in South Africa, Meyer has spent his intermittent years advising other strife torn areas in the world on conflict resolution. He is currently advising Myanmar. When Cyril Ramaphosa was elected as President, he however decided to re-engage and has offered to spearhead a channel between the business community and the Presidency to accelerate growth in the country. He is a firm believer that Ramaphosa can turn the country around. - Linda van Tilburg See omnystudio.com/listener for privacy information.

In today's Biznews Flash Briefing: The Old Mutual share price jumped on news that its board has decided to fire its CEO Peter Moyo. The Naspers share price moved up about 2% on Tuesday. The Public Investment Corporation is encouraging its fund managers at the Government Employees Pension Fund to reduce its Naspers shareholding of about 16%. There has been an exciting breakthrough in the fight against corruption and state capture. Trillian Capital Partners has been ordered to pay back Eskom almost R600m by the High Court in Pretoria. President Cyril Ramaphosa will announce more measures to support cash-strapped power utility Eskom, his office said on Tuesday. Late on Tuesday, R18.22 would buy you one British pound, R14.52 would get you one US dollar and R16.26 could be exchanged for one Euro. See omnystudio.com/listener for privacy information.

President Cyril Ramaphosa is eager to create an investor friendly climate in the country but it seems that customs clearance and exchange rules imposed by the South African Revenue Service is having the opposite effect. Recently a health science start-up company told me how their overseas investor eventually decided to undertake tests for one of their products that they planned to roll out in South Africa to a European destination as customs at Oliver Tambo were holding up their goods for months, waiting for clearance from SARS which cost the firm valuable time and money. South Africa lost out on an investment opportunity because of red tape and an overly strict application of exchange controls. President Ramaphosa has said recently that red tape was keeping tourists away from the country, but as I illustrated in this case, it is not only tourists, but also investors the country so sorely need who are put off by red tape and exchange regulations from SARS. A member of our business community has highlighted ho

Have a listen to the first seven minutes of the Preface to Anthony Butler's masterful biography on Cyril Ramaphosa.......it gives you taste of what to expect in the 22 hours that follow of the new audiobook now available for purchase and downloading at https://gumroad.com/l/ramaphosa-biography-audio   See omnystudio.com/listener for privacy information.

In today's Biznews Flash Briefing: The South African Broadcasting Corporation is in serious trouble and faces a blackout. The financial position of the SABC has been worsening as it awaits a decision on its application for a R3.2bn financial support from the government. At SAA, another state-owned entity that has sucked up billions of taxpayers’ money, pilots are threatening to strike over what they believe is a poor choice of CEO. The Johannesburg Stock Exchange has waded into the divorce between accounting firm Deloitte and financial services group Sygnia. Tesla CEO Elon Musk claims to have “just deleted” his Twitter account. He made his statement in a tweet, but the account still appeared to be active after the post. On the currency markets, at the end of the public holiday the Rand was trading at about R14.78 to the US dollar, about R18.57 to the British pound and about R16.60 to the Euro. See omnystudio.com/listener for privacy information.

The chief investment officer of Integral Asset Management, Bruce Williamson, has been a long-time follower of KZN's iconic and now embattled corporation Tongaat Hulett. The veteran analyst, who has held senior positions at stockbrokers SBC Warburg, ABN Amro Securities and Imara Asset Managers (whose team left to form Integral), reckons investors should have paid more attention to the "perfect storm" of bad news that has knocked Tongaat over the past couple years. He supports the view of many that long-time CEO Peter Staude is a most unlikely fraudster - and says he would be shocked to discover the man he knows really well played any role in misleading investors. He spoke to me on Rational Radio. - Alec Hogg See omnystudio.com/listener for privacy information.

The World Economic Forum is best known for its annual meeting in Davos every January. But in between that week in the spotlight, lots goes on at this multilateral institution, including a great deal of groundbreaking research. The release of a WEF report on retirement funding last week delivered a wake-up call for governments, companies and retirees - for the vast majority, their savings will expire long before their life force. On Rational Radio, I chatted with Han Yik. co-author of the report who said solutions exist, but none are easy. Over-riding all of them, however, is the need for each of us to take responsibility for our own financial future. - Alec Hogg   See omnystudio.com/listener for privacy information.

I first met British film maker Anthony Fabian in London two years ago. At the time he was hoping to soon put the finishing touches to a series of eight documentaries he expected would help rebalance the awful global image of South Africa. We engaged a few times thereafter, contacts which providing me with a window into the financial challenges which artists like Fabian face. After an initial kick from FirstRand, the Good Hope project struggled to attract enough support from other South African stakeholders. Eventually it was only through the cash injection from two movie makers in California that the project was completed. But it's now in the can and a full length movie has replaced the proposed documentaries. I caught up with Tony on Rational Radio. - Alec Hogg See omnystudio.com/listener for privacy information.

Gidon Novick went into the family business (Comair), left when a major shareholder (Brian Joffe) wanted to change things and then worked for three years as CEO of Vitality and head of digital at global financial services disruptor Discovery. A chartered accountant with an MBA from Kellogg, he escaped the corporate world two years ago. And the man I had breakfast with this week is clearly thriving in the entrepreneurial space. He joined us on Rational Radio to talk about his latest passion, Home* Suite Hotels. See omnystudio.com/listener for privacy information.

Bruised from the Steinhoff debacle, South Africa is facing a fresh corporate scandal with the news that Tongaat Hulett has requested that its shares be temporarily suspended over concerns about the accuracy of the company’s published financial statements. While the Tongaat situation seems to be more a matter of poor judgement than intentional misbehaviour, for shareholders, the news is still bad. In this episode, Alec Hogg carefully lays out the details of the drama at Tongaat and explains what comes next for the company and its shareholders. It makes for grim listening. By all accounts, it will be many months before the tangled web of accounting issues is unravelled and shareholders are once again able to trade freely in the counter. See omnystudio.com/listener for privacy information.