WEBVTT

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You're listening to Strictly Business
Podcast

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with Lindsay Williams.

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The JSC has closed its doors for another
day,

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so it's time for the five o'clock shadow.

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And as always on a Wednesday, I speak to
Skulk Lowe,

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Portfolio Manager at PSG Wealth

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Old Oak in Cape Town.

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Last week, you weren't here, Skulk,

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because you had a PSG Wealth conference.

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Did that go well?

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Very well.

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Yeah, no, very, very well.

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Very,

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very enlightening speaking to some of my

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fellow colleagues and solving some

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of the world's financial problems.

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And yeah, that was a very, very,

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very positive

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get-together.

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Yeah, thank you.

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Very good.

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Excellent.

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I won't ask you what conclusions you came
to because

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conclusions are, in my opinion,

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probably redundant the next day.

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And this week's markets and the last even

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24-hour markets have been...

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Testament to that statement I've just
made.

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Oil price, inflation in the United States,

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S&P 500 down 1.5%.

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But I want to start in South Africa if I
can.

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Anglo-American platinum.

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Surely this provides some sort of

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opportunity somewhere.

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An extraordinary day for one of our key
companies.

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Bad to worse.

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I mean,

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these platinum counts have been under

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pressure.

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You know...

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you fall out of the you know one of the
main index and

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you get a minus 11 day it's so

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yeah no it's

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a it's a toughie it's a toughie but yeah
you know to your

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your original question do i think it's a

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it's a it's an opportunity yes i do think
it's an opportunity i

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think uh

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you know these these platinum counters has
been under

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i've been under massive massive pressure
already

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and Yeah,

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I do think that there's some opportunity
when you

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get a movement, sort of a natural
movement.

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I mean,

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this is a lot of fund

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managers just pre-empting,

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following an index now,

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no need to have this share,

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and sort of pre-empting the move.

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So, yeah,

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I think it's an opportunity.

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Looking at the graph,

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which I was earlier on with a previous
interviewee,

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2,250...

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or something was the closing high a number
of years ago.

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It's currently around about 50,

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51.50, let's call it, whatever it is.

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No, what am I talking about?

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2,250 down to 515.

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Platinum is still needed, I think.

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I think people are being too bearish.

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And it's also caught up in the general

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malaise when it comes to commodities,

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oil price in particular,

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which we'll talk about in a moment.

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Is it a perfect storm on the downside?

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And are people...

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capitulating and therefore people like you

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patient people will say now's the
opportunity to

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get in yeah

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this do attract my interest and i know i
mean

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people say well then let's go out and buy
we need

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to know that there's there's a few things
happening in the eye we've

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had the

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the the whole ev ev space uh you

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know on pgms um we've got a

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global uh economic

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slowdown um not a

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real session yet.

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And it's just sort of bad news upon

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bad news upon bad news for

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the PGM counters.

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But when I look at a share

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price, I mean, you just mentioned another
11% down today.

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That brings the year-to-date performance
of this company

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over 50%.

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When something loses half of its value, I
mean, you looked at the highs.

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I just looked at January.

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January.

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this company lost pretty much another half
of

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its value.

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So then something do attract me.

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And

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I think you might need to be patient,

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might need to not go in, you know, all in.

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These encounters are what we call
cyclicals.

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Yeah, and for good reason.

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I mean,

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something that can lose 50% of its value
in a

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few months'time.

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and then just gain it.

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That is extremely cyclical and extremely
volatile.

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But yeah,

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I do think it is something that's always
going to be needed.

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I don't think the EV space is going to be
slap bang, there we go,

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every one of us are going to be driving

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electric vehicles.

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And clearly,

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the hybrid model is something that's going
to be

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tested for quite some time,

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which is good for platinum or palladium

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BGMs.

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Quite right too.

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So yeah, it's worth watching,

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but after a little bit of considered
analysis,

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I would say.

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I think that's what you're saying here.

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Have a look at it,

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but don't get too carried away until the

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whole Anglo-American unbundling process

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has been done, don't you think?

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I mean, that's obviously a cloud in the
background and, you know,

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corporate activity.

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That's also a factor, Skark.

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Yeah, yeah, it's open.

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I mean, it is.

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It's an overnight of shares.

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You know, suddenly, you know,

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Anglo-American shareholders will have, you
know, these

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Anglo-American platinum shares.

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And for those,

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let's call it large investors that might
have

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Impala Platinum, Northern, you know,
Sibania,

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one of those counters, they might look at
this and say, well,

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let's consolidate, you know, sell their
platinum,

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buy some more, some of the other
companies.

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Be there as it may.

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I mean, there's a few things.

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I mean, you just said it.

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You started off.

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It's the perfect storm.

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Do I think it's a bad

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company, Amplats?

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No, I think it's one of the best

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PGM counters in the world.

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It's one of the largest

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PGM counters or companies in the

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world, mines in the world.

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So, yeah,

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I think this do open up some
opportunities,

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but it will be first of all for.

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How do they always say it's not for widows
and orphans?

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Also, Sibanyu Stillwater is not for widows
and orphans.

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I was just looking at a share price at

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2022, I think,

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under the stewardship of its still CEO,

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Neil Froneman.

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75 rand a share.

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It's now down to today.

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What is that, Sibanyu Stillwater?

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Five and a half percent down to say 14
rand

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a share, from 75-odd to 14.

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horrendous destruction of

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wealth.

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Yeah, it's sad.

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It's sad.

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I think, yeah,

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what else to say?

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I mean, you mentioned the value
destruction.

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It's definitely value destruction.

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I think there's a few shareholders that
would like to go back

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to early 2022 now

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and just take those profits

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where they could run about the 60,

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65-rand levels.

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You talk a lot about property and you've
made no

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secret of the fact that you are long of
property stocks on the

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JSC.

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Growth Point,

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you must be interested in those results
because they still

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warn about high interest rates, Gael.

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What did you make of these results and the
commentary

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associated with those results?

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Well, this is the fact that there's been
extremely

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kind to us.

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I mean, this is something, I mean,

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you and I have had this conversation.

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You've done well, let's put it this way.

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Yeah, yeah, but it's something for good
reason.

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And I don't.

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think that the whole all all you know

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trade is is overall it's called the reason
why

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i am overweight in in property i mean

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i yesterday i went and uh i

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updated that uh stats essay sheet now for

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those listeners let's let's listen to this
for the first time this

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explanation stats

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as they produce on a monthly basis they
will

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produce different stats on on

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residential and non-residential

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properties yeah

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The one that interests me is the
non-residential one,

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the office space,

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the shopping centers,

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industrial, all the non-residential
properties.

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And what they say,

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they say there's a stat that they give
that says

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non-residential potential properties
completed

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by the period.

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Now, what does that mean?

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It means you drop your plans,

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you go and build that specific

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property.

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There's somebody comes.

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comes along and they sign that property
off they

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send it to the municipality and the
municipality said that property

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is completed now when you look at

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the status this text is phenomenal it's
really so

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interesting looking at the stats when you
look at the stats

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you will see early

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2000s you know there was a lot of
uncertainty right south

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africa we had a

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1994 the

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the whole um madiba magic

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and and then we had a change of god

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And people were also a little bit worried.

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We also had extreme worries globally

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on recessions.

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We had worries on wars,

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geopolitical unrest.

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Remember, we had 9-11 and after that,

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it was Afghanistan war and then

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Iraq war.

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There was uncertainty.

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And people during that,

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I suppose,

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we had high interest rates and they just
did not

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develop.

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They didn't develop new properties.

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And people were looking at this and said,
well,

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yeah, for good reason.

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But sooner or later,

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this is going to pass as well.

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And then what we're going to have,

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we're going to sit with a massive

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demand and not enough stock.

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There's not going to be enough supply.

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So you and I had this conversation, I
think, a few months,

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a year ago.

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And I said, look at this.

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People are going back to offices.

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They're going back to shopping centers.

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This work in your pajamas is gone.

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Something all.

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past and yet were they

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not completing enough offices,

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they're not completing enough shopping
centers,

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yet the demand is increasing.

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Well, surprise, surprise, now we're
starting to see it.

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Now we're seeing, I mean, last night...

270
00:10:02.369 --> 00:10:04.870
I was part of a

271
00:10:04.910 --> 00:10:07.371
conversation with the CEO of ATT&CK.

272
00:10:07.431 --> 00:10:09.431
They brought out their results yesterday,

273
00:10:09.752 --> 00:10:12.653
and they exactly had the same story.

274
00:10:12.713 --> 00:10:14.713
They bought some properties,

275
00:10:13.834 --> 00:10:16.595
and they now clearly can see the demand

276
00:10:16.795 --> 00:10:19.436
increasing at a speed of

277
00:10:19.616 --> 00:10:21.616
light.

278
00:10:20.537 --> 00:10:22.537
What are they doing, though, Scott?

279
00:10:21.657 --> 00:10:23.657
Sorry to interrupt.

280
00:10:22.517 --> 00:10:25.158
Are they taking old buildings that haven't
been occupied?

281
00:10:25.158 --> 00:10:27.158
I mean, for example,

282
00:10:26.059 --> 00:10:28.820
the old Cecil building in Rosebank springs
to

283
00:10:28.840 --> 00:10:31.221
mind years and years ago when they
relocated.

284
00:10:31.837 --> 00:10:33.837
to Santon, I think it was.

285
00:10:33.638 --> 00:10:36.300
Are they taking buildings that used to be
offices

286
00:10:36.700 --> 00:10:39.582
and up until now have not

287
00:10:39.642 --> 00:10:42.523
been offices and saying, rather than build
a new one,

288
00:10:42.863 --> 00:10:45.085
we're going to completely revamp this one?

289
00:10:45.165 --> 00:10:47.966
How do they go about adjusting to the new

290
00:10:48.326 --> 00:10:50.326
we're going back to work mode?

291
00:10:50.928 --> 00:10:52.928
That's the problem, Lindsay.

292
00:10:52.829 --> 00:10:55.370
I mean, they'll need to.

293
00:10:55.370 --> 00:10:57.370
I mean,

294
00:10:56.511 --> 00:10:58.552
I'm not going to mention the company's
name because

295
00:10:58.932 --> 00:11:00.932
I was sort of a...

296
00:11:00.257 --> 00:11:02.257
No, no,

297
00:11:00.678 --> 00:11:03.560
it's just a conversation we had with some

298
00:11:03.560 --> 00:11:06.342
of these, let's call it decision makers.

299
00:11:06.342 --> 00:11:08.342
Oh, I see.

300
00:11:06.683 --> 00:11:08.844
It's a big,

301
00:11:08.944 --> 00:11:10.944
big listed company.

302
00:11:10.646 --> 00:11:13.088
And they, during, let's call it two years
ago,

303
00:11:14.009 --> 00:11:16.009
sort of post-COVID,

304
00:11:16.671 --> 00:11:19.413
they literally moved all their

305
00:11:19.573 --> 00:11:21.573
smaller branches,

306
00:11:20.934 --> 00:11:23.697
moved it into these larger clusters.

307
00:11:24.017 --> 00:11:26.739
And they closed these offices because they
said, well, people,

308
00:11:28.280 --> 00:11:30.280
they'll…

309
00:11:29.477 --> 00:11:31.979
You will work on a Wednesday and on a
Friday and

310
00:11:32.679 --> 00:11:34.920
your mates next to you,

311
00:11:34.980 --> 00:11:36.980
you will work on a Monday.

312
00:11:36.021 --> 00:11:38.902
And this is how we're going to do it.

313
00:11:38.902 --> 00:11:41.884
Now, everybody's going back to the office
and there's just not enough office space.

314
00:11:42.324 --> 00:11:45.126
They're frantically looking around and
say, well,

315
00:11:45.206 --> 00:11:47.206
we need office space.

316
00:11:46.286 --> 00:11:48.286
But as you mentioned,

317
00:11:47.507 --> 00:11:50.449
the only thing that's currently available
is older offices,

318
00:11:50.549 --> 00:11:52.549
older buildings.

319
00:11:51.389 --> 00:11:54.050
You know, some of these companies that's
held by

320
00:11:54.111 --> 00:11:56.111
GrowthPoint, High Props,

321
00:11:57.172 --> 00:11:59.172
their tax, these companies.

322
00:11:58.913 --> 00:12:00.913
Suddenly,

323
00:12:00.495 --> 00:12:03.317
the net asset value of these properties
are

324
00:12:03.397 --> 00:12:05.397
increasing again,

325
00:12:05.799 --> 00:12:07.799
and the yields as well.

326
00:12:07.560 --> 00:12:09.560
So do I think

327
00:12:09.902 --> 00:12:12.645
the whole property investment play

328
00:12:13.425 --> 00:12:15.425
is over in terms of South Africa?

329
00:12:15.287 --> 00:12:17.287
No, not at all.

330
00:12:16.968 --> 00:12:18.968
I still think the yields are attractive,

331
00:12:19.590 --> 00:12:22.493
and our stock is very, very depleted.

332
00:12:22.573 --> 00:12:24.573
Quite right, too.

333
00:12:23.193 --> 00:12:25.495
And after the inflation data from the
United States,

334
00:12:26.016 --> 00:12:28.016
which peaked recently,

335
00:12:27.737 --> 00:12:29.778
As Donald Trump keeps on reminding us,

336
00:12:30.038 --> 00:12:32.799
he doesn't remind us of the number because
he's not

337
00:12:32.819 --> 00:12:34.819
clever enough to remember the number,

338
00:12:34.560 --> 00:12:37.461
but it was 9.1% CPI in the United States

339
00:12:37.461 --> 00:12:39.461
of America.

340
00:12:38.301 --> 00:12:41.263
It's fallen today on the CPI announcement
from the

341
00:12:41.283 --> 00:12:43.584
United States of America, the world's
biggest economy,

342
00:12:43.664 --> 00:12:46.385
down to 2.5% coming close to

343
00:12:46.465 --> 00:12:48.465
target range.

344
00:12:47.725 --> 00:12:49.846
And that must be good for global

345
00:12:50.606 --> 00:12:53.568
capital markets worldwide, including South
Africa.

346
00:12:53.848 --> 00:12:55.848
So very good news there, Skulk.

347
00:12:56.129 --> 00:12:58.129
Yeah.

348
00:12:56.789 --> 00:12:59.650
yeah no no that's not not getting close
that is bang on

349
00:12:59.710 --> 00:13:02.611
target i mean we know that that that pal
said

350
00:13:02.912 --> 00:13:05.373
he wants to see um inflation back to

351
00:13:05.413 --> 00:13:07.894
2.5 percent weight and it was

352
00:13:07.974 --> 00:13:10.815
interesting i i out this morning at this
conversation with my

353
00:13:10.875 --> 00:13:13.716
team and i said because there's a nice
tool the cm

354
00:13:13.956 --> 00:13:15.956
cme fed tool where

355
00:13:15.817 --> 00:13:18.358
they look at the probabilities of rate
cuts

356
00:13:18.718 --> 00:13:21.679
and they'll for instance look at the
different meetings and this

357
00:13:21.739 --> 00:13:23.820
in terms of this one is now the 18th of
september

358
00:13:24.620 --> 00:13:26.620
then they will look at different

359
00:13:26.001 --> 00:13:28.983
probabilities on will we see a

360
00:13:29.203 --> 00:13:31.203
cut, will we see an unchange,

361
00:13:31.605 --> 00:13:33.605
and if we see a cut,

362
00:13:33.286 --> 00:13:35.286
what's the probability of a quarter
percentage,

363
00:13:35.107 --> 00:13:37.107
what's the probability of half a
percentage?

364
00:13:36.688 --> 00:13:38.688
But this morning, as we came in,

365
00:13:40.471 --> 00:13:42.471
it stood roundabout.

366
00:13:42.132 --> 00:13:44.934
There was a bit of an improvement towards
the

367
00:13:45.034 --> 00:13:47.034
quarter of a percent,

368
00:13:46.896 --> 00:13:49.557
but it stayed more or less the

369
00:13:49.737 --> 00:13:52.700
70% probability for a quarter of a percent

370
00:13:52.780 --> 00:13:54.780
and 30% probability.

371
00:13:54.921 --> 00:13:56.921
for a half a percent.

372
00:13:56.682 --> 00:13:58.762
And for any

373
00:13:58.862 --> 00:14:00.862
non-mathematicians out there,

374
00:14:00.223 --> 00:14:02.803
that's pretty much 100% probability for a

375
00:14:03.304 --> 00:14:05.304
rate cut next week, Wednesday.

376
00:14:07.625 --> 00:14:09.685
This afternoon, I made the comment and
said, well,

377
00:14:09.966 --> 00:14:11.966
it'll be interesting, although

378
00:14:11.546 --> 00:14:14.287
I can pretty much say with 100%
probability from my

379
00:14:14.367 --> 00:14:16.768
personal opinion that we'll see a quarter
of a percent.

380
00:14:17.648 --> 00:14:20.329
I think if the inflation rate

381
00:14:20.409 --> 00:14:22.409
comes out at...

382
00:14:21.465 --> 00:14:23.847
2.5 percent because remember it was

383
00:14:23.907 --> 00:14:26.629
expected 2.6 percent if it comes out

384
00:14:26.689 --> 00:14:29.290
2.5 percent watch how the

385
00:14:29.350 --> 00:14:32.232
probability on on a half a percentage
suddenly

386
00:14:32.232 --> 00:14:35.054
just skyrockets and it just didn't it it

387
00:14:35.194 --> 00:14:38.036
it totally different scenario happened it
went

388
00:14:38.517 --> 00:14:40.517
uh that the quarter percent increased

389
00:14:40.538 --> 00:14:43.420
again and now 83 probability for a

390
00:14:43.440 --> 00:14:45.441
quarter percent hike and um

391
00:14:45.481 --> 00:14:48.323
17 on on a half percent but

392
00:14:49.064 --> 00:14:51.064
to me they're the most surprising

393
00:14:51.266 --> 00:14:54.031
that part was that the market's

394
00:14:54.071 --> 00:14:56.456
reaction of the inflation came out.

395
00:14:57.072 --> 00:14:59.072
Man, oh man,

396
00:14:58.213 --> 00:15:00.494
they're taking an almighty club today.

397
00:15:00.814 --> 00:15:02.814
I know, we've got the S&P down,

398
00:15:02.815 --> 00:15:05.477
the S&P futures, down one and a half
percent, well,

399
00:15:05.537 --> 00:15:08.038
down one and a third percent, actually,
it's just adjusted itself.

400
00:15:08.758 --> 00:15:10.758
But I don't quite understand that.

401
00:15:10.519 --> 00:15:13.141
And looking at the US 10-year bond, which
we'll come to in a moment,

402
00:15:13.661 --> 00:15:15.661
which is totally now,

403
00:15:14.902 --> 00:15:17.783
3.62%.

404
00:15:17.823 --> 00:15:19.823
Yeah, but the stock market not taking it
well.

405
00:15:19.964 --> 00:15:22.446
Maybe the stock market isn't taking it
well because of the

406
00:15:22.506 --> 00:15:24.506
debate last night.

407
00:15:24.007 --> 00:15:26.488
And if Kamala Harris gets in.

408
00:15:27.092 --> 00:15:29.693
Which I really hope, from a personal point
of view,

409
00:15:29.693 --> 00:15:32.154
and this is not a PSG Wealth point of
view,

410
00:15:32.194 --> 00:15:34.295
I have to tell you, if she gets in,

411
00:15:34.275 --> 00:15:36.275
I'll be very happy.

412
00:15:35.356 --> 00:15:37.356
But the stock market won't be.

413
00:15:37.556 --> 00:15:40.117
Maybe they're anticipating a victory in
two

414
00:15:40.157 --> 00:15:42.979
months'time and are positioning themselves
accordingly,

415
00:15:43.039 --> 00:15:45.039
Skark.

416
00:15:43.339 --> 00:15:45.339
I don't know.

417
00:15:43.759 --> 00:15:45.759
Did you watch the debate?

418
00:15:44.839 --> 00:15:46.839
I've watched it twice.

419
00:15:46.880 --> 00:15:48.880
I had clips.

420
00:15:48.261 --> 00:15:50.362
I must say, I just did not get myself.

421
00:15:50.382 --> 00:15:53.183
I was awake once or twice around

422
00:15:53.223 --> 00:15:55.223
about 3 o'clock.

423
00:15:55.904 --> 00:15:57.904
Yeah,

424
00:15:56.204 --> 00:15:59.145
I just did not get myself to listen to
Trump

425
00:15:59.225 --> 00:16:01.346
for the next few hours of that time in the
morning.

426
00:16:01.346 --> 00:16:04.007
But I did look at a few of the highlights.

427
00:16:04.207 --> 00:16:06.207
Yes.

428
00:16:04.808 --> 00:16:06.808
I don't know, Lindsay.

429
00:16:05.728 --> 00:16:08.589
We can have a massive debate on which one
will be best for

430
00:16:08.629 --> 00:16:10.810
South Africa, Kamala Harris or

431
00:16:11.730 --> 00:16:14.692
Trump. We know Trump won't necessarily be

432
00:16:14.732 --> 00:16:16.853
good for emerging markets.

433
00:16:18.373 --> 00:16:20.373
So I don't know.

434
00:16:19.154 --> 00:16:21.554
It's sort of the lesser of two evils.

435
00:16:21.855 --> 00:16:23.855
B, you've got a good point.

436
00:16:23.475 --> 00:16:25.475
I think that could be the

437
00:16:25.396 --> 00:16:28.279
But I think the most likely scenario

438
00:16:28.459 --> 00:16:31.122
for today's movement, it's just,

439
00:16:31.662 --> 00:16:34.064
and yesterday on X, that's the old
Twitter,

440
00:16:35.326 --> 00:16:37.388
I actually placed a graph,

441
00:16:37.528 --> 00:16:40.471
which I looked at the last few times where

442
00:16:40.591 --> 00:16:43.353
interest rates were

443
00:16:43.473 --> 00:16:45.473
cut,

444
00:16:44.414 --> 00:16:47.097
where the declining

445
00:16:47.217 --> 00:16:49.217
phase started.

446
00:16:48.618 --> 00:16:50.618
And I just mentioned, I didn't make a...

447
00:16:50.340 --> 00:16:52.340
I didn't make a prediction.

448
00:16:51.741 --> 00:16:53.802
I didn't say this is going to happen.

449
00:16:53.923 --> 00:16:55.923
All I said,

450
00:16:55.023 --> 00:16:57.505
if you exclude COVID,

451
00:16:57.545 --> 00:17:00.267
which was a sort of a very, very unique
situation,

452
00:17:01.168 --> 00:17:03.168
if you exclude

453
00:17:05.311 --> 00:17:07.311
COVID, you're sitting with

454
00:17:07.012 --> 00:17:09.213
2001 and

455
00:17:09.213 --> 00:17:11.213
2007.

456
00:17:12.856 --> 00:17:15.298
When they actually stopped the hiking
phase for that,

457
00:17:15.798 --> 00:17:18.540
let's call it a few months, we had one of
the best...

458
00:17:18.680 --> 00:17:21.502
bull phase because everyone was expecting
the

459
00:17:21.582 --> 00:17:24.323
next step to be interest rate being you
know a a

460
00:17:24.563 --> 00:17:27.345
cut and that should be good for

461
00:17:27.465 --> 00:17:30.367
for you know equities so there

462
00:17:30.367 --> 00:17:33.068
was sort of this was it as the rumor go by
and rumor sell on

463
00:17:33.148 --> 00:17:36.090
fact was the anticipation of the rate cuts

464
00:17:36.410 --> 00:17:39.292
were way better than the actual rate cuts
because when

465
00:17:39.312 --> 00:17:41.974
you look at the rate cuts itself um

466
00:17:42.594 --> 00:17:44.594
and

467
00:17:42.714 --> 00:17:45.676
you look at the after effect you would see

468
00:17:46.096 --> 00:17:48.096
that with

469
00:17:46.997 --> 00:17:49.459
2001,

470
00:17:49.459 --> 00:17:51.741
where the rate cut actually started,

471
00:17:52.882 --> 00:17:54.882
market dropped 32%.

472
00:17:54.584 --> 00:17:56.584
With the world financial crisis,

473
00:17:56.365 --> 00:17:58.527
where the rate cut actually started,

474
00:17:59.268 --> 00:18:01.530
the S&P 500 dropped 41%.

475
00:18:01.570 --> 00:18:04.132
Yeah, but there was extraneous factors
there.

476
00:18:04.152 --> 00:18:06.152
I mean,

477
00:18:04.473 --> 00:18:07.375
people were still digesting the global
financial

478
00:18:07.435 --> 00:18:09.435
crisis,

479
00:18:08.016 --> 00:18:10.979
and it took a while for the cheaper money
phase

480
00:18:11.259 --> 00:18:13.259
to kick in.

481
00:18:12.560 --> 00:18:15.101
And that is my analysis, very simple as it
is.

482
00:18:15.281 --> 00:18:17.281
But this time, Skunk,

483
00:18:17.121 --> 00:18:19.121
it could be a shallow recession,

484
00:18:19.062 --> 00:18:21.062
as indicated by the oil price.

485
00:18:20.942 --> 00:18:23.123
It could be a short, sharp recession,

486
00:18:23.423 --> 00:18:26.204
as indicated by Chinese and American data.

487
00:18:26.744 --> 00:18:28.744
But the fact is that interest rates,

488
00:18:29.185 --> 00:18:32.086
medium term, on the downside,

489
00:18:32.346 --> 00:18:34.446
is good for equity markets.

490
00:18:35.086 --> 00:18:37.086
Undoubtedly.

491
00:18:35.827 --> 00:18:38.327
So this is the Skunk point of view.

492
00:18:38.327 --> 00:18:40.648
I mean, I'm just, I put the graph out.

493
00:18:41.789 --> 00:18:44.030
So declining interest rates will be good.

494
00:18:45.471 --> 00:18:47.793
And I do think that the way Powell

495
00:18:48.133 --> 00:18:50.415
handled this, I mean,

496
00:18:50.415 --> 00:18:52.415
I often said that they, you know,

497
00:18:52.036 --> 00:18:54.036
inflation,

498
00:18:54.157 --> 00:18:56.859
interest rate won't really make a massive

499
00:18:56.919 --> 00:18:58.919
effect.

500
00:18:58.340 --> 00:19:00.340
We can debate that.

501
00:18:59.541 --> 00:19:01.863
But I think the fact that they are

502
00:19:02.884 --> 00:19:05.285
really, really conservative in the way
they're doing,

503
00:19:05.646 --> 00:19:07.647
they are waiting for this 2.5%.

504
00:19:07.687 --> 00:19:09.687
Well, we're there now.

505
00:19:09.188 --> 00:19:11.709
They are going to most probably do a
quarter of a

506
00:19:11.749 --> 00:19:14.210
percentage, do another quarter of a
percentage,

507
00:19:14.350 --> 00:19:16.350
and just get the market to settle.

508
00:19:16.191 --> 00:19:18.191
And like you said,

509
00:19:17.772 --> 00:19:20.473
what you've actually told us is a soft

510
00:19:20.513 --> 00:19:22.513
landing.

511
00:19:20.913 --> 00:19:23.734
We will most probably then see a soft
landing.

512
00:19:24.034 --> 00:19:26.034
I think so.

513
00:19:25.015 --> 00:19:27.016
I mean, the China news is baked in
already.

514
00:19:27.436 --> 00:19:29.657
American jobs and

515
00:19:30.457 --> 00:19:32.457
growth sluggishness,

516
00:19:32.018 --> 00:19:34.018
not so much growth but jobs,

517
00:19:34.639 --> 00:19:36.639
it's part of the cycle.

518
00:19:35.599 --> 00:19:37.599
But it's not going to be.

519
00:19:36.988 --> 00:19:38.988
Dramatic.

520
00:19:38.669 --> 00:19:40.669
Maybe a quick one on Supergroup.

521
00:19:40.129 --> 00:19:42.130
I don't know if you've watched that one,
but it's numbers.

522
00:19:42.130 --> 00:19:44.130
A quick minute on that one, if you've got
it.

523
00:19:43.911 --> 00:19:46.552
If not, then we'll pass on to the markets.

524
00:19:47.573 --> 00:19:49.573
Yeah, Supergroup,

525
00:19:49.313 --> 00:19:51.915
I'd add a quick glance on Supergroup.

526
00:19:52.835 --> 00:19:55.776
You know, when I look at this, you know,

527
00:19:56.477 --> 00:19:58.498
they've grown, they've revenue,

528
00:19:58.938 --> 00:20:00.938
that didn't look too bad.

529
00:20:01.539 --> 00:20:03.880
When we look at, you know, the earnings.

530
00:20:04.384 --> 00:20:07.166
earnings decrease by 97

531
00:20:07.226 --> 00:20:09.988
percent and there goes the share price
share

532
00:20:10.008 --> 00:20:12.309
price down down seven percent

533
00:20:12.810 --> 00:20:15.692
um so yeah not not not a not a

534
00:20:15.752 --> 00:20:18.654
good i mean when we look at the the um you

535
00:20:18.654 --> 00:20:20.654
know the positives

536
00:20:20.675 --> 00:20:23.377
out there they actually said um that

537
00:20:23.777 --> 00:20:26.179
the the weakening rant um you know

538
00:20:26.839 --> 00:20:29.781
that helped them well we know that's not
going to be the case now

539
00:20:30.942 --> 00:20:33.264
because we see the rant actually improving
um

540
00:20:34.216 --> 00:20:36.317
Yeah, so I think in general,

541
00:20:37.098 --> 00:20:39.939
not the best set of results in terms of
how they manage the

542
00:20:39.939 --> 00:20:41.939
company over the time.

543
00:20:40.900 --> 00:20:43.241
But as I mentioned, not a company that I'm
really following.

544
00:20:43.921 --> 00:20:45.921
Okay, good.

545
00:20:44.782 --> 00:20:46.782
Well said.

546
00:20:45.982 --> 00:20:47.982
Right, now let's have a look at the
markets.

547
00:20:47.863 --> 00:20:49.863
Dollar Rand, 1793.

548
00:20:49.744 --> 00:20:52.246
British pound against the Rand is 2335.

549
00:20:52.246 --> 00:20:54.907
The Euro Rand is 1974.

550
00:20:54.907 --> 00:20:56.907
Euro dollar, 11010.

551
00:20:57.268 --> 00:21:00.090
And the British pound against the US
dollar is 130,

552
00:21:00.670 --> 00:21:02.670
almost on the nose.

553
00:21:02.271 --> 00:21:04.271
Gold price, that's okay.

554
00:21:04.164 --> 00:21:06.164
Back above 2,500,

555
00:21:05.465 --> 00:21:08.427
which is gratifying because it wasn't so a
couple of days ago.

556
00:21:08.427 --> 00:21:10.427
2,512,

557
00:21:09.947 --> 00:21:11.947
which has barely changed on the day.

558
00:21:11.568 --> 00:21:13.568
Platinum,

559
00:21:11.929 --> 00:21:15.150
9.59,

560
00:21:15.150 --> 00:21:17.150
which is up 19.

561
00:21:16.131 --> 00:21:18.312
And Palladium up 39 to

562
00:21:18.312 --> 00:21:20.312
9.99.

563
00:21:19.693 --> 00:21:21.693
Call the police in England.

564
00:21:21.274 --> 00:21:23.575
And that's a 4% move to the upside.

565
00:21:23.915 --> 00:21:25.915
When it comes to other commodities,

566
00:21:25.576 --> 00:21:28.378
and I've been fascinated by it all over
the

567
00:21:28.398 --> 00:21:30.398
last 10 days,

568
00:21:29.299 --> 00:21:31.740
it's gone from 90 to below 70 this year.

569
00:21:32.768 --> 00:21:34.768
Which is a huge move.

570
00:21:34.149 --> 00:21:36.849
So I think at the current level for Brent

571
00:21:36.909 --> 00:21:39.330
crude of $69.45,

572
00:21:39.330 --> 00:21:42.211
we are technically in a bear crude oil

573
00:21:42.611 --> 00:21:44.611
market.

574
00:21:43.351 --> 00:21:45.351
It's up slightly today by 0.4%,

575
00:21:45.492 --> 00:21:48.413
but it's still $69.45 for

576
00:21:48.433 --> 00:21:50.433
Brent crude.

577
00:21:49.533 --> 00:21:51.533
And West Texas crude

578
00:21:50.594 --> 00:21:52.754
$66.27,

579
00:21:52.754 --> 00:21:54.754
up 0.8% today,

580
00:21:54.395 --> 00:21:57.316
but a horrible weekly and monthly and

581
00:21:57.416 --> 00:21:59.416
yearly performance.

582
00:21:59.056 --> 00:22:01.056
Natural gas is up a little bit.

583
00:22:01.237 --> 00:22:03.237
Copper is up a little bit,

584
00:22:02.217 --> 00:22:04.278
but nothing else to speak of.

585
00:22:04.658 --> 00:22:06.658
So look at the South African 10-year.

586
00:22:06.558 --> 00:22:09.039
Don't forget we've got a Reserve Bank
meeting next week,

587
00:22:09.399 --> 00:22:11.399
9-17.

588
00:22:10.960 --> 00:22:12.960
The US

589
00:22:11.740 --> 00:22:13.961
10-year, after that inflation data of

590
00:22:14.281 --> 00:22:16.281
2.5%,

591
00:22:16.101 --> 00:22:18.101
the CPI 3.63%,

592
00:22:18.502 --> 00:22:21.423
which is a pretty good move to the
downside for

593
00:22:21.423 --> 00:22:23.423
the yield.

594
00:22:22.403 --> 00:22:24.403
S&P 500 futures.

595
00:22:24.412 --> 00:22:26.412
We're recovering a bit actually.

596
00:22:25.813 --> 00:22:28.035
They were down over 1.5%,

597
00:22:28.196 --> 00:22:30.538
down 1.2% at the moment at

598
00:22:30.578 --> 00:22:33.080
5,438.

599
00:22:33.200 --> 00:22:35.643
And Bitcoin is

600
00:22:35.783 --> 00:22:37.845
56,100 and a bit,

601
00:22:38.225 --> 00:22:40.587
which is down 1.3%.

602
00:22:41.068 --> 00:22:43.068
Market moves today, Scalp.

603
00:22:43.490 --> 00:22:45.632
You show me yours, I'll show you mine.

604
00:22:45.672 --> 00:22:47.672
Do I go first?

605
00:22:46.913 --> 00:22:49.396
I told you, you show me yours first and
then I'll...

606
00:22:50.296 --> 00:22:52.837
Well, we had

607
00:22:53.317 --> 00:22:55.978
M-Plats, which we've already discussed.

608
00:22:56.898 --> 00:22:59.879
A few companies did stand out in terms of

609
00:23:00.039 --> 00:23:02.039
well, when I say a few companies,

610
00:23:02.479 --> 00:23:04.479
a massive,

611
00:23:03.700 --> 00:23:06.441
massive list in terms of ex-debt.

612
00:23:06.441 --> 00:23:08.441
So, you know,

613
00:23:07.441 --> 00:23:10.101
ItalTal might probably stand out as

614
00:23:10.482 --> 00:23:13.162
a drop, but they had a dividend and a
special dividend.

615
00:23:13.222 --> 00:23:15.222
Super Group, we've already discussed.

616
00:23:15.683 --> 00:23:17.683
Coronation,

617
00:23:17.363 --> 00:23:19.363
they also had a

618
00:23:19.544 --> 00:23:22.226
ex-div so you know sabania still

619
00:23:22.266 --> 00:23:24.927
watered no ex-div so yeah and

620
00:23:25.387 --> 00:23:28.329
apps are again negative you know five
percent ex-div story

621
00:23:28.369 --> 00:23:31.070
so today would most people be one of those

622
00:23:31.431 --> 00:23:34.312
days if you see a massive drop in the
share price you would most

623
00:23:34.332 --> 00:23:36.874
probably need to go and look at the
dividends

624
00:23:37.214 --> 00:23:39.435
yeah so the ones that have fallen

625
00:23:39.615 --> 00:23:42.517
on merit or rather demerit and sabania
down

626
00:23:42.537 --> 00:23:45.278
5.3 percent anglo-american platinum down

627
00:23:45.278 --> 00:23:48.200
11.1 percent corporate activity of course
involved

628
00:23:48.240 --> 00:23:50.240
there you

629
00:23:48.900 --> 00:23:51.861
but people just don't like it and i love
it when people don't like

630
00:23:51.901 --> 00:23:54.562
things because that means that i start to
get interested

631
00:23:54.882 --> 00:23:57.083
and like it 507

632
00:23:57.644 --> 00:24:00.105
rand per share quite

633
00:24:00.125 --> 00:24:03.026
extraordinary it was a buy i think it

634
00:24:03.026 --> 00:24:05.967
is this is not a recommendation from
either skunk at

635
00:24:05.987 --> 00:24:08.908
psg wealth or lindsey williams from
wherever he is no it's

636
00:24:08.988 --> 00:24:11.649
it's not i don't own it either but it

637
00:24:11.889 --> 00:24:14.711
really looks in my virtual portfolio

638
00:24:15.111 --> 00:24:17.612
as though i should be buying it on the

639
00:24:17.632 --> 00:24:19.632
upside Property,

640
00:24:19.949 --> 00:24:22.771
Hyprop up 3.5%, Kumbayanoor up 2.9%,

641
00:24:22.811 --> 00:24:24.972
Premier up 2.6%, Mass,

642
00:24:25.373 --> 00:24:27.374
another property company, up 1.5%,

643
00:24:27.374 --> 00:24:29.816
and Vukile up 1.4% as well.

644
00:24:30.096 --> 00:24:32.678
Closing indices, please, Skull, and value
traded,

645
00:24:32.678 --> 00:24:34.678
of course.

646
00:24:34.219 --> 00:24:36.981
So just for those

647
00:24:37.421 --> 00:24:39.863
wondering what the whole Hyprop story is,

648
00:24:40.323 --> 00:24:43.045
they came out with a trading statement

649
00:24:43.085 --> 00:24:45.085
today.

650
00:24:43.706 --> 00:24:45.706
Yeah.

651
00:24:44.026 --> 00:24:46.688
Clearly had the market, you know,

652
00:24:46.908 --> 00:24:48.908
quite...

653
00:24:47.228 --> 00:24:50.010
quite excited um they they

654
00:24:50.050 --> 00:24:52.851
mentioned the dividend per share you know
for approximately

655
00:24:53.592 --> 00:24:56.274
two rand 80 um and yeah like

656
00:24:56.314 --> 00:24:59.175
mentioned that that definitely had the
market quite quite

657
00:24:59.195 --> 00:25:01.897
excited when we look at the jse today jse

658
00:25:01.977 --> 00:25:04.959
closed 80 828 points

659
00:25:04.979 --> 00:25:06.979
that is down one percent

660
00:25:07.384 --> 00:25:09.384
top 40 close 73

661
00:25:09.465 --> 00:25:12.406
223 points also down 1.1 percent

662
00:25:13.066 --> 00:25:15.968
resources they um at

663
00:25:15.968 --> 00:25:18.909
a very very bad day 1.2 down but not the
worst

664
00:25:18.909 --> 00:25:21.870
the worst came from the financial sector
safe financial

665
00:25:21.890 --> 00:25:24.631
sector were down 1.6 percent while the
industrial

666
00:25:24.691 --> 00:25:27.672
sector were down 41 basis point and this
is sort of a

667
00:25:27.712 --> 00:25:29.712
trend that we've been

668
00:25:29.373 --> 00:25:31.914
been getting used to because as

669
00:25:31.974 --> 00:25:34.735
mentioned in end of end of last month the

670
00:25:34.895 --> 00:25:37.741
the is a property index where we're up
over one year,

671
00:25:37.881 --> 00:25:39.982
over 38% year-to-date,

672
00:25:40.543 --> 00:25:42.945
close to 24% up.

673
00:25:43.385 --> 00:25:45.385
And since then,

674
00:25:44.165 --> 00:25:46.887
we've seen that the equity market or
locals,

675
00:25:47.348 --> 00:25:49.348
as well as the offshore equity market,

676
00:25:49.529 --> 00:25:52.231
has given back

677
00:25:52.672 --> 00:25:55.514
quite a bit of performance that they made
in

678
00:25:55.914 --> 00:25:58.156
August. Yet, the property sector,

679
00:25:59.197 --> 00:26:01.197
just going from strength to strength.

680
00:26:00.558 --> 00:26:02.558
And today was no different.

681
00:26:01.919 --> 00:26:03.919
Today, they closed up 30%.

682
00:26:03.980 --> 00:26:06.921
39 basis points in the market that were
really looking

683
00:26:06.981 --> 00:26:08.981
bad.

684
00:26:07.702 --> 00:26:09.922
When we look at the value traded, value
traded, not too bad,

685
00:26:10.083 --> 00:26:12.083
23 billion for today.

686
00:26:12.744 --> 00:26:14.744
Very good.

687
00:26:13.904 --> 00:26:16.545
Yeah, the highest trading day for the past
week.

688
00:26:17.826 --> 00:26:19.947
You can interpret that in a couple of
ways.

689
00:26:20.007 --> 00:26:22.428
But yeah, 23 billion, pretty good.

690
00:26:22.768 --> 00:26:25.529
Next week, we'll look at the JSC Limited,
what its share price is doing,

691
00:26:25.569 --> 00:26:28.030
which is also a fascinating subject

692
00:26:28.810 --> 00:26:30.810
in its own right.

693
00:26:29.871 --> 00:26:31.871
Skulk, thank you very much for your time
this evening.

694
00:26:31.791 --> 00:26:33.791
Skulk Lowe is a portfolio manager at...

695
00:26:33.512 --> 00:26:36.233
PSG Wealth Old Oak in Cape Town and that
was the

696
00:26:36.273 --> 00:26:38.273
five o'clock shadow.

697
00:26:38.314 --> 00:26:41.075
The views and opinions expressed in these
podcasts are those of

698
00:26:41.115 --> 00:26:44.037
Lindsay Williams and various contributors
and

699
00:26:44.057 --> 00:26:46.898
do not reflect the policy position or
opinion

700
00:26:46.958 --> 00:26:48.999
of any other agency, organisation,

701
00:26:49.339 --> 00:26:52.200
employer or company associated with

702
00:26:52.240 --> 00:26:54.240
StrictlyBusinessPodcast.com.

703
00:26:54.441 --> 00:26:56.862
Assumptions made on the analyses are not

704
00:26:56.982 --> 00:26:59.923
reflective of the position of any other
entity other

705
00:26:59.963 --> 00:27:01.963
than the speaker or the author.

706
00:27:01.684 --> 00:27:04.188
And since we are critically thinking human
beings,

707
00:27:04.548 --> 00:27:06.872
these views are always subject to change,

708
00:27:07.152 --> 00:27:09.716
revision and rethinking at any time.

709
00:27:10.016 --> 00:27:12.440
Please do not hold us to them in
perpetuity.