You're listening to Strictly Business Podcast with Lindsay Williams.
The JSC has closed its doors for another day and indeed another week.
Although it's Thursday, tomorrow is Human Rights Day in South Africa.
So it's a long weekend coming up.
With me is Viv Govender from Ransuisse in Johannesburg.
And he's joined, as always, by David Shapiro from Sassvin Securities in that
same city.
Viv, can I start with you?
Three central banks this week.
We had the Bank of Japan held their rate at, what is it?
a quarter of a percent or half a percent or something.
US Federal Reserve last night keeping their rate unchanged as well,
but quite a dovish sort of commentary around that from the Fed chair, Jerome
Powell,
and then the Bank of England today also unchanged.
And you've got the JN, you've got the Reserve Bank.
The Reserve Bank, us.
Yeah, us, yeah.
Oh, of course, yes.
I forgot about that.
So that's the Reserve Bank unchanged.
Maybe wrap up the central bank situation for us a few words.
Sorry about that.
Basically, we're over the guaranteed rate cut future.
And now we're looking at basically a situation in which these central banks
don't know what's going to be happening.
We are seeing enough weakness in the global economy to worry.
But we're also seeing signs that inflation is starting to rise again.
And so they're kind of caught between a rock and a hard place at the moment.
And they don't know exactly what to do going forward.
And that's why they're in a situation where they're probably looking at data
each time.
to make a decision.
And I think that is going to make these interest rate decisions much more
interesting.
Because if something is totally expected, the market prices it in.
We're not going to have that, I think, for the next few meetings, at least.
I saw some commentator today, Viv, staying with you, and said there's only one cut
this year coming.
That's what the market's expecting from the US Federal Reserve, the most important
central bank, of course.
And that will be in August.
Would you agree with that summary?
I don't know.
I mean, this is the bet that you have to be taking.
It could be.
You could even be seeing rate hikes by the start of next year, depending on how
things go.
But this is a situation in which we just don't know what the world economy looks
like, what the U.S.
economy looks like six months from now.
And I think that is the danger in the moment.
It's the fact that there's so much uncertainty that we just don't have the
ability to make these predictions out even a few months.
And talking about uncertainty, David, extraordinary volatility in markets at the
moment.
I mean, one day the S&P, I'll go to bed with the S&P closing down 70, 80 points.
The next day, it's up 60.
This morning, it was down.
The futures market was down.
And now I see it's turned around again.
So it's great for day traders if you get it right.
If you get it wrong, it's horrible.
You're out of a job.
But a lot of uncertainty out there.
No one can read this.
Absolutely no one can read it.
I don't care how smart you are unless you're playing.
You know, you have an algorithm that tracks the very,
very short-term movements in a market.
But you have to put a lot of money and have to have ultra-high-speed type of
computers to kind of get in front of the orders that eventually
find themselves to whatever system you're trying to get in front of.
It's impossible.
But you know what?
If I listened to Powell last night, I actually went through his…
his meeting and it was quite interesting because he was very calm but just uh you
know echoing what viv said
he doesn't know what's happening and he admitted it you know in not so many words
i mean or in those words nobody
understands inflation at the moment and everybody's guessing at it and therefore
it's almost impossible for
them to try and make any kind of forecast about what lies ahead all he could
All he could say was that the U.S.
economy was in decent shape.
They weren't going to get a recession.
And kind of brushed aside, they are withdrawing the, what do you call it?
It's monetary.
Got to get this right.
How would you say?
In other words, they're not selling the bonds that they bought during the easing
period where they
put liquidity into the market.
They're actually holding back.
They don't want to sap out liquidity.
from the market at the moment by reducing their book you know that one that they
built up during the covert year so there were a
couple of points but the market actually responded quite positively to what he had
to say i think they were expecting
worse on the inflation front so as
a result i think this is what's giving us a little bit of a lift at the moment and i
think we're also just
tending to you know when he used the word transitory And I'd like Viv to come in, or
even you, Lindsay, you know.
That was three years ago, wasn't it, when he said transphobia?
He used it last night.
Oh, did he?
Okay.
Yeah.
He said that this was transitory.
In other words, the issue around tariffs.
What I think he's saying is what I've been believing is that Trump is in such a mess
at the moment.
I don't think he understands from minute to minute what he's doing.
Somewhere along the line, all of this is going to unravel against him.
And he's going to have to kind of draw back or pull back on everything that he's
done.
You know, from Musk.
to these 200%
threats on French champagne and so on.
So I think all of this is going to just be a bad dream in a month or two, you know, a
couple of months as well.
I mean, I don't think he can keep up with all these...
Viv, I think you've got to come in here.
David and I always speak together on a Monday, and we have a full go at Trump.
I mean, it's our sort of rant afternoon.
But he is quite haphazard, isn't he?
Things that come out of his mouth have only just popped into his head.
And then afterwards he says, huh, okay, 50% on whiskey, so I'll make it 200%
on French wine and champagne.
Yeah, that sounds good.
And off he goes.
Do you agree with that?
Look, I agree that Trump doesn't have an idea,
a philosophical economic approach to how the world works that is coherent.
That is not to say that this administration doesn't.
I think there's people in there that have spotted a person that they think is a
vehicle for their plans going forward.
Musk is not basically following Trump's plan.
He's basically doing what he wants in a system, using Trump as a vehicle.
People like Stephen Miller are using Trump as a vehicle to do what they want.
Do you think Trump has any idea about the Foreign Alien Act,
that was signed by John Adams back in the revolutionary days?
Do you think he has any idea as to how...
treasury works and how you know whose database has column has to be filled in uh
you know to get you know payments done
i think trump because of his of his almost always have hazardous in the first
administration he was contained because he didn't have enough of a
plan and the people around he wanted to contain this is a different administration
which the people around him want to change things and his
hazardousness basically makes it makes them able to do these things like iran
must apparently doesn't run doge it's some woman that lives in
tennessee that runs doge according to the law
But if you think that's the technical thing,
but the reality is obviously he's doing it.
Stephen Miller basically doesn't have too much power,
but he's able to basically defy a government or
a judge's order by saying, according to this particular interpretation of the law,
the plane has taken off and you can't do anything about it.
It's international waters.
These are the kind of moves I think are going to have
some significant impacts internationally and nationally right into the future.
I don't think this is going to be transitory, unfortunately.
Okay.
The so-called border czar, he did say, he said, I don't care what the judges say.
How can you say that in the world's, supposedly the world's greatest democracy?
I don't care what the judges say.
We're going to do this.
It's the most extraordinary situation, David.
Sorry.
Go on.
No, of course it is.
But I think that, you know, Roberts, Chief Justice Roberts has come down on him.
And I think he's going to find his administration involved in a huge number
of court cases,
regardless of what he says.
I think the American people will rise against him.
I think I really mean that.
I think that, you know, initially it was a lot of fun to have somebody like this come
in as well and to
shake up Europe and so on.
But he's going much deeper than that.
I mean, his attack on the education on Colombia.
And I've been reading quite a bit like that because I'm going to New York next
week.
I know Columbia.
I often run through it.
And the problem is that, you know, he is by withdrawing the $400 million,
most of that actually goes to the sciences.
And, you know, though that university is very close to a number of hospitals where
the money goes
into research, it's not in the liberal arts side of it.
And the people involved on that side are not.
not necessarily the people who've been protesting.
So I think there are a lot of issues.
He's gone for Penn as well, you know, because they won't change,
that they're allowing transgender people into their sports teams or something like
this.
I mean, this is nonsense.
You know, that kind of stuff is also, there's got to be a backlash against it.
You know, I don't care if...
Whatever, you know,
do I care about Pennsylvania's university swimming team or something like that?
The interesting thing talking about that is that the Pentagon yesterday were
instructed to say to go to put
in keywords with some with some program and put in the keywords, you know, D.I.
or black or transgender, whatever.
And to get all of the articles that were on the Pentagon website.
or in Pentagon archives and delete them all.
24,000 were deleted.
I mean, they didn't vet them.
I mean, there's certain things that, or gay was the other word that came up.
And they're just expunging American history with one push of a button.
And again, Viv, I have to blame you about this song because it's not the greatest
times of real life.
I'm sorry.
But it is quite sinister.
I mean, even Viv, even you would agree with me that you have to manage
AI and algorithms and all that sort of thing.
Oh, yeah, most certainly.
I mean, and in fact, I'm quite a, if you have to, there's a thing that's called,
people are called accelerations and doomers.
People that want to go faster, people that are afraid of what might happen.
I'm a doomer.
I really do think that, you know.
Really?
You look at any kind of historical, even the invention of the printing press, you
know what I mean?
Caused like, you know, decades of war in Europe.
And that was just basically movable time.
uh you're talking about the radio and you have the rise of fascism around the world
the internet causes you saw the internet caused the rise of
populism uh you know also things like for instance you know uh girls uh you know
harming themselves any big technology is
going to have you know negative side effects the bigger the technology the
bigger the side effects are going to be and
this is a very big technology and it's going to have remarkably bad you know
impacts on certain people out there it's it's uh it's it's a
given uh but going back to this thing about you know uh this uh Remember when
people said, oh,
Elon Musk had that 18 months to do stuff on Doge, and therefore that was meant to
be like, oh,
Trump was basically neutering him.
Actually, it worked out to be the reverse, because he only sees himself as having
another year to go, basically.
And I think even Trump doesn't see himself having more than about another year and a
half in terms of political power, because after that,
he becomes a lame duck.
I think these guys are going to be doing...
some significant things and and the philosophy that musk says he has when it
comes to these kind of things is overdo it and if you are overdoing
reverse what you have to do but don't underdo it because you're never gonna have
a chance again i think that's what's happening there and i i told you a couple
weeks ago
uh david so i think it was lindsay that this is going to be the most uh you know
impactful presidency in our lifetimes i
i think that is true i mean we've seen the usa id is gone but even though it's been
reversed by a judge it's effectively over
I think we're about to see the House of Education gone.
We're about to see just the way the U.S.
works gone.
And I don't think it's going to be good for the U.S.
after a couple of years because what Trump is doing is he's taking all the trust the
U.S.
has earned over the last 70 years and he's spending it now.
So people have built the trust in how the world works on the U.S.'s stability.
You design your defense forces around the U.S.
You design your financial system around the U.S.
financial system.
And Trump right now is able to take all that kind of built-in kind of like inertia
and trust and say, you know,
we're going to destroy how the world works.
Because we've all depended on it for so long.
You're totally on the back foot.
And we're going to have a lot of power for a short period of time.
But in a few years' time, it's going to be totally different because everybody's not
going to trust the US anymore.
And we're going to build new systems that have changed how the world works.
And this goes back to the analog world.
I mean, continuing this theme, but as I say, analog.
The UK has the...
the BBC World Service, which is a fantastic resource.
And it doesn't matter where you are, you get your little shortwave radio, you could
be in Mogadishu, wherever, wherever on earth it is,
and you can hear proper news, unbiased news, in my opinion.
Voice of America has virtually been shut down.
You're turning on, you turn on Voice of America because it's unbiased reporting,
but because it doesn't fawn on Trump's ideas, he's closed it down.
I mean, what is that?
That is a classic dick.
dictator, censoring everything that doesn't agree with him.
But the Detroit of America was fine.
It was propaganda, but so what?
You know, when I say propaganda, you're going into the whole of Africa.
You're going into all these regions.
Just whether you're not, you know, whether it's propaganda, I mean in the sense that
it's Google's type.
in a views.
No, I don't think it was like that.
I used to do a lot of reports for the Voice of America.
Joe DiCaprio used to phone me often and just have a chat about things.
There was absolutely nothing.
He would ask me something and I would give him a true objective view of what was
happening in South Africa.
He used to ask me some very, not leading, but nice chats.
He was great.
And I've listened you've listened to BBC World Service.
You've listened to Voice of America.
I've never regarded that as biased or propaganda, but, I mean, it does spread.
You know, it's like any kind of advertising.
You know, advertising is propaganda.
You know, buy these what's the name?
Buy this coffee.
Buy this beer.
What do you think?
Anyway, but But to go to those kind of extents and start breaking down what has
made America,
I don't know.
It's just two years old.
Go there, Lindsay.
I'll be there.
I'll be there next Thursday evening.
I'm leaving next Thursday.
We will talk on the Monday.
Yes.
And I will get a good view of what's happening on the ground there, how people
are believing,
certainly coming from New York.
You will be our voice of America.
I will be your voice of America.
Viv, do you want to interject to that?
This is the weird thing, right?
It's like he's not a dictator because a dictator wants to have power.
What he's doing is he's going and he's destroying all the levers that a future
leader would use to do things.
Like the voice of America, USAID, okay, here's the thing.
USAID is not only about aid.
In fact, his name doesn't mean aid.
It means the International Agency for Development.
And it's not a...
a purely charitable organization.
It's a way of the U.S.
to exercise soft power around the world.
But you would think if you ran the U.S., you'd want to have more ability to
exercise soft power around the world.
You would think that if you have the voice of America, which is not entirely, like
David said, you know, unbiased, it's going to have a U.S.
bias.
It's called voice of America.
It's America's voice.
But he, this is a weird case in which a guy that is basically a strong man in
charge of a
state doesn't trust the state he's in charge of.
And he's just...
destroying the state he's in charge of.
That is the weird thing.
I don't think you can find any example, anywhere in history, when somebody took
over a country like this and became the strongman,
like leader, and then decided to take away all the tools that the strongman will use
to control the country.
It's going to be a very, very weird place for the US in the next decade or so.
Okay.
Let's get back to South Africa now, talking about weird places.
Get back to South Africa with you, David.
I'm just looking at results today.
momentum.
Didn't we comment upon the trading update a couple of weeks ago, and the share price
was up 15%?
It's probably gone down since then, and it's bounced back after the people see the
results in black and white, up 11% today.
And this is a sort of a sleepy company to me.
In fact, it's not a sleepy company.
Well, obviously not.
And that's why, you know, it's always been overlooked by the the power of Sunlum and
old Mutual and Discovery,
you know, they've got most of the attention.
And yet this company has done really well under its new management.
I'm not, I can't even name the CEO, but slowly they've kind of,
you know, remember it came from Metropolitan, a combination of
Metropolitan and Momentum.
Yes.
And now it's just called Momentum, but it's a...
It's a really good business that produces some very solid numbers.
And that it's up 10%, I'm not quite sure because we did know these results.
I don't know what was seen in the results that we didn't pick up.
But, you know, it has happened.
I think if you look at it relative to the others, it's probably cheap, you know,
relative to the others and with a solid record.
Very good.
You know, there's only one thing, sorry, and I have to say this.
Apologies, Lindsay.
Okay.
There's no top line.
Going through the results, that's a worry.
There's no top line.
And I think this is I go back to the argument that we've been having for some
time now.
You can't grow companies without top line.
They're not selling product.
In other words, they're not getting new clients.
You've got the old clients.
They're becoming quite efficient.
Below the line on the insurance side, the claims are good.
they're well covered and so on.
But the big worry with all the companies that are reporting now,
top line is static and it's it's reflective of what's happening in the
economy so that's just one
point you've got to watch out for that okay very good point indeed let's have a
look at some markets now the rand's doing well it's up one
and a half percent against the us dollar or rather the dollars fallen one and a
half percent against the rand let's
put it in the correct order 1818 british pound against around 2356 euro
Rand is €1969, €108.30.
Onto commodities, gold price is €3040. I mean, every time I look at that, I think,
what is that,
in rands or something?
No, it's dollars.
It's $3040 an ounce, up $14 an ounce today.
The white metals, though, they're so lackluster.
€993 for platinum, still in three figures, which is down $8 today.
And palladium...
is down $16 to $950 an ounce.
Now, the oil price, I was really bearish on oil last year, but all sorts of things
keep on happening,
the Houthis and Yemen and everything else going on.
So we got West Texas crude, $68.05, up 1.7%.
Brent is $71.92, which is up 1.6%.
What else is happening here?
We've got the S&P 500, as I said earlier on.
Futures were down about 0.6% this morning.
Now the real market is up around about 0.4%.
S&P 500 futures for the June delivery,
5,753.
U.S.
10-year Treasury bond yield, 422 we'll call it, 4.22%.
South African 10-year after the Reserve Bank today, 10.84%.
And finally, Bitcoin is 86,000.
just above 86,000, which is about a 2% gain.
Viv, there was a nice retail sales number from South Africa yesterday, quite a
startling number, actually, nearly 8% up.
Has that affected the retailers at all?
And if not, do you think the retailers should be looked at,
given what we've just seen yesterday with that number I just mentioned?
It did.
I mean, you saw the retail stocks yesterday did quite well.
We're leading the market by it, so I think, yeah, it did kind of affect the
market.
it just doesn't make sense from the neighbors i don't see how these guys are
going to be able to adjust going forward i think the
question about is the economy is growing you know barely you know just over a
percent yeah how do we justify these these
massive you know because retail city increases year on year uh when
people don't have any money more money i mean where is it coming from howard unless
the the the told us uh the informal economy is growing gangbusters
i just don't see how this uh these numbers are sustainable Okay.
David, you're not a fan of the retailers we were speaking about again on Monday.
I mean, that's going to be nasty, but you were quite disparaging about them.
I am.
I just think they, you know, I just think exactly what Viv says and what I've
repeated.
There's no top line.
And even though, you know, it happened, the January sales numbers were very good.
But I was a bit confused by it.
I went into econometrics and looked what the problem was.
I said last January.
Going back to January 24 was a very bad month,
and therefore on the comparative basis you got this kicker.
Look, there's also been the two-pot system, people withdrawing their pensions
in advance,
and real wages are up because inflation's come down and so on,
interest rates are down.
So there's a little bit more money around, but I don't think enough to make a strong
case for…
any of the financials and for any of the retailers in our market.
Okay.
Let's have a look at individual stocks now.
We've mentioned Momentum.
That was the standout.
On the upside, Shaftesbury Capital. There was some sort of market speculation which
has propelled that one
up over 7%.
Harmony up nearly 5%.
On the downside, is there an ex-div story here, David?
Process and NASPS both getting hit over 5%.
Is that… Ex-10 cent was down.
Oh, I see.
Tencent had very good results, but the market was a little upset because they're
not spending enough on AI and knocked them in
Hong Kong this morning.
So we suffer the consequences.
OK.
But this is the volatility you're talking of, Lindsay.
We don't know from one day to the next what's going to happen.
But that was the story today.
OK.
Vestek down nearly 4%, PLC that is.
Aspen down 3.6% and Subanya still water down just over.
3%.
Give us the indices ahead of the long weekend, please, David.
Well, the all-share index has closed down 0.7% at 89519.
That's after touching an all-time high yesterday.
Resorts are still busy, I think, on the back of that gold price.
And there is money flowing into that.
The all-share, I mean, the resource index up.
0.6% with the precious metal side of it up 1.2%.
That has been the trend over the last couple of weeks.
Banks down slightly.
The broader financial market, I think, picked up by, I'm talking about an
insurance picked up by that momentum move.
Industrial market down
2.25%. And that's on the back of the downward moves in process, NASPERS,
Richemont,
author, under a bit of pressure.
So I think...
Those three stocks have a big weighting on the industrial index.
Okay.
So that's about it.
Very good.
Value's been up, I must say, Lindsay.
We've seen over the last few weeks way above the kind of activity that we saw
last year.
Oh, today something must have happened.
They must have been rebalancing today.
Or is today the end of a that's March.
Oh, it's futures closeout.
Oh, of course it is, yeah.
Last Thursday of the quarter, yes.
or nearly 87 billion went through the market that must be an all-time record
87 billion well that's a lot about that's yeah in fact it's more it's a yeah it's
about 88 with nice bears making up
11 billion of that angler gold five and a half billion of that and so on so all
right big day for
today good night good one for the jse limited very quickly viv i saw the head of
nvidia
looking very enthusiastic and very nasty in his leather jacket on stage with a
robot last night.
And he's talking about a collaboration with General Motors.
Is this one of the things that is sort of chipping away at Tesla, for example,
because they're talking about self-driving cars and NVIDIA says, right, we're going
to assist you with this.
Yeah, look, I mean, everybody's trying to do it at the moment.
I don't know how it's going to be done exactly.
There is this whole debate between.
what's called lidar which is kind of like a laser radar and just cameras which what
tesla uses tesla argues that you know humans use just
their eyes they don't have you know a radar and therefore you should be able to
just you know uh travel just with your eyes so there is a
bit of a divergence there honestly uh i don't think it's the gm guys that are
going to be the guys that are really a
threat to tesla it's what's happening in china uh i don't know if you've looked
at what the chinese vehicles look like at the moment they are unbelievably
innovative you know it's a it it
In China, Tesla is like the old-fashioned basic model.
What you get from...
And expensive.
Yeah, and expensive.
I saw a quote by one journalist.
They say, Tesla is what you buy if you don't know about cars.
So the Chinese are the real movers out there.
And I think that is the real thing.
I think it's also a real threat coming from China as well.
Because you're seeing Huawei really moving up into the chip business.
We are seeing, you know, the latest, like, developers from these guys.
It's the Chinese.
Well, you've got BID as well, eh?
Yeah.
With a five-minute kind of charger.
You know, you've got a battery that you can charge up in five minutes.
Like, it's a petrol car.
But the Chinese, the sanctions that the U.S.
has put against China are backfiring, I think, massively.
The sanctions against South Africa, we can't really do much.
We don't have the capacity to really bake our own local industries.
you sanctioned you know they give them a bit of a head wind that it's happening and
they're going to start developing their own local industries and in some ways they
are
better suited in terms of intellectual power the amount of engineers they have
the one of you know manufacturing capacity they have i mean first i saw this thing
this was ridiculous china has i think 200 times not 20 percent times like the like
the ship manufacturing capacity of the us
is going to really take off because of the fact that they are basically being
sanctioned.
And here's the weird thing.
I think a lot of the other parts of the world are going to support China because
the U.S.
sanctions against chips and so on are affecting places like Brazil and India.
And those guys are going to be buying from China and not buying from NVIDIA going
forward.
On that note, gentlemen, please go away and have three days off and decompress.
David, I'll speak to you on Monday, but
Viv and I will listen to you the following Monday about your Voice of America
broadcast.
And, yeah.
Have a lovely time.
Gentlemen, thank you so much.
Viv Govendale,
this is Rand Swithson,
David Shapiro
from Sessvin
Securities. And that was the five o'clock
shadow.
other than the speaker or the author.
And since we are critically thinking human beings, these views are always subject to
change, revision,
and rethinking at any time.
Please do not hold us to them in perpetuity.