You're listening to Strictly Business Podcast with Lindsay Williams.
The JSC has closed its doors for another day, so it's time for the 5 o'clock
shadow.
And as always on a Thursday, I've got the double-headed Dream Team edition of Viv
Govender from RAND Swiss
and David Shapira from Sasson Securities.
Viv's in a car, David's in New York, I'm chilling here in the Netherlands.
And the market's taking a bit of a chill as well, David.
Start with you on that one, because there's no data coming out from the
government.
Because there is no government in the United States.
No.
You know, you laugh about that, or I laugh about that,
because at the moment they are in shutdown and the fight continues.
And neither side wants to give up.
And of course the Democrats, which is no longer a party, and we can talk about
that.
I'd love to hear Viv's views on that and just discuss it.
But at the moment they're just floundering.
And this just gives them a little bit of leeway in the sense that they want
concessions
on health care, which was taken away completely by Mr.
Trump.
He wanted to get Obama and he's finally getting it by removing so many benefits
in health care.
So that's the bargaining tool.
In the meantime, the fighting goes on backwards and forwards.
And to be honest.
The market doesn't care, it just moves its own way.
You don't see any reflection in the market, in fact, of any geopolitical news.
But when you look at this, Lindsay, and you look at the Democrats,
they're good at regional level or municipal level or state level, whatever
it is.
But as a federal party, There's just no one there.
It's like the Conservative Party in the UK.
It's just fallen away.
It's a non-entity.
Now, Viv, would you agree with that?
Yeah, look, I mean, I think the problem with the Democrats is they don't have a
vision.
So, for instance, I mean, Trump puts up, you know, not paying civil servants.
And then Bernie Sanders comes out and says, maybe we shouldn't pay the military
and air traffic controllers.
I mean, you will have no sympathy among anybody if you're not paying your soldiers
that are putting your lives at risk or people that are.
controlling the planes, you know what I mean?
That makes no sense.
And then you have, you know, the people, then they say, what we need is our own
Trump.
And so they're putting up Gavin Newsom, who is, you know, he may be on the
Democrat side, but he's as slimy as Trump is, you know what I mean?
That's high praise indeed, to be as slimy as Trump. Yes, Trump is.
I mean, he's one of those guys that was going on, you know, dinner parties and
stuff when he had California locked out,
famously.
So, I mean, you need a vision.
And unfortunately, what's going to happen is you're going to have somebody like a
Mamdani who will probably,
if he was actually born in the U.S., be the new star of the Democratic Party.
He's about to be mayor of New York.
He's about to, you know, take over the largest, you know, most powerful city in
the U.S.
But I think if you look at, for instance, what's happening with regards to the
European elections, what's happening in Japan.
To be honest, unfortunately, you'll have to say that, you know,
we're going to go to extremes because the mainstream parties are not giving you a
solution.
And that's kind of what Trump is.
He's an extreme reaction to the Republicans not giving a solution to their
voters.
And unfortunately, we're going to have these crazy people, you know, being in
charge going forward,
unless we can have someone more sensible and centrist, which I don't know how the
current system was that personally brings them into power.
Yeah.
It is a difficult one and it plays right into Trump's hands, of course.
Yes, go on.
Viv, I mentioned this to Lindsay earlier on in the week.
What I'm finding here is that people who were moderate and were anti-Trump and were
Democrats
are now,
I think they despise the left more than they do the right and are shifting more
towards Trump.
And you're seeing that in Wall Street, you know, if I can define Wall Street as being
the investment community.
They're quite happy with where things are at the moment.
You know, if you read Bill Ackman's tweets, I mean, he's come out fully in
favor of Trump.
He's a big Trump supporter at the moment in every respect.
And those are chaps who certainly, you know, wouldn't have voted or supported
him.
Yes, there were chaps.
There were certain hedge fund managers who...
who were Republican and supported Trump. But generally, New York was, I think, more
left than right.
But they're going right.
And that's simply because There's just no one standing up for the Democrats or
coming with any plausible
policies.
We could talk about the fight in New York, because I watch it all the time.
When I say front page, I mean you watch the TV.
There's a massive battle going on now at the moment.
The youth, as you say, all supporting Mamdani.
Also, the coma coming out there is the opposition.
But he's tainted.
He's tainted from COVID.
He's tainted from other things.
I mean, not just COVID.
I mean, there's also that harassment allegation against him as well.
And what amazes me about Cuomo is he's basically going after Mamdani as being a
nepotism baby.
Cuomo's father was the governor.
Yeah, I know.
It's the craziest thing I've ever seen in my life.
Well, this is US politics.
I mean, it's...
When you watch it unfold in front of you, it's quite remarkable.
You know, it's, I watch with, you know,
almost it's humor and they change their mind.
Comer wanted to close down Rikers Island, you know, the infamous prison.
Now he wants to keep it open.
Why?
Because Mamdani wants to close it down and so on.
Mamdani wants free, you know, everything must be free, you know, no more
meritocracy and also free.
Transport-free grocery, you name it.
Anyway, so you watch this all happening and say, I think I've seen this before,
you know,
maybe 30 years ago in South Africa, the same kind of battle.
But anyway.
All right, so we've got politics.
As I briefly said there, it plays into
Donald Trump's hands and it's very sad that someone so mediocre can be the most
powerful man in the
world.
But anyway.
That's one thing.
The other thing is the market, which has been quite extraordinary since we last
spoke as a threesome here.
And a lot of it is to do with the Federal Reserve.
AI aside, let's have a look and see what the notes from the minutes of the FOMC
said.
The meeting was on the 16th and 17th of September.
The notes came out last night.
It says the FOMC is strongly committed to supporting maximum employment and
returning inflation to its 2%
objective.
I don't know whether they can have their cake and eat it,
but I had a very good chat with a fund manager from London this morning.
And he said that this is actually tailwinds for the equity market.
Viv, since you've been away, you've seen the market, as we have, go to all-time
record highs almost every day.
And this is a tailwind, this chap said.
Would you agree?
Or has it already been factored in, i.e.
two more cuts?
I know you said no AI, but I mean, apart from the FT, 80%
plus of growth in the US stock market this year has been AI-related stocks.
40% of US growth, GDP growth period, overall economic growth, is AI-related.
You know what I mean?
And possibly it is undercounting it.
It could be as much as half of all US growth this year has been AI-related.
So, yeah, what's happening with the Fed, I think it's obviously important.
But what's happening also with the spending that we're seeing.
And Also, since we last talked, I mean, there's kind of like these circular deals
being done all the time.
Yeah.
Where, you know, OpenAI is doing deals with people where I don't know exactly who
buys what and who gets what.
But it doesn't seem like actually any real economic activity is happening.
But it translates into hundreds of billions of dollars of extra valuations
for NVIDIA and AMD and Oracle, et cetera.
And, you know, even we have XAI getting into these deals as well with NVIDIA at
the moment.
So it feels extremely, extremely bubbly.
I mean, my AI portfolio, which I'm, you know, guys I know I run, is up 20% since
the start of September.
So you said a word there that David, I could feel David's shudder there,
actually.
David switched off when you said the word bubbly.
Now, because I keep on saying it to him, he says, no, not until further notice, not
until I'm otherwise advised.
Will I do anything about it?
And that's quite right.
But just quickly staying with you, Viv, I gave David a question on Monday and I
said,
are you happy that there's this M&A and corporate activity going on?
There's so much.
I saw a graph today, a chart today, and it had one of those graphs, sorry,
charts with lots of circles in it and lines going off from one circle, which is
a company,
to another company.
And it was incredibly complicated,
but it was just the AI deals that had been done by the companies that you mentioned,
you know,
AI Chat, GPT, Oracle, Intel, you name it.
It's so confusing.
But is that a good sign or is it a sign of the top?
Look, I mean, here's the thing to understand as well.
The people that are making these decisions are not making economic decisions.
Listen to what Mark Zuckerberg says.
Look at what Larry Page says.
Look at what Elon Musk and some others.
These are the guys driving this stuff forward.
I mean, Larry Page comes out and says he's willing to risk bankruptcy in order to not
miss out on the AI race.
Zuckerberg talks about, you know, we're spending a couple hundred billion dollars
as a price worth paying.
in order to make sure that he basically is in that race.
So these guys are operating on a very kind of emotional kind of level.
And so in that scenario, you could find, you know, like the chip companies, which
is like, you know, one of the best performers out there doing really, really
well.
But the thing that gets me is that when you have these circular deals and the
market reacts so positively to that,
you've got to probably say that, you know, irrespective of the underlying technology,
which I still believe is progressing.
I mean, Sora 2 is amazing if you haven't used it.
still an amazing technology but why is the market rewarding nvidia and amd with deals
that don't where they're
effectively inverted commerce selling stuff to uh it goes openly without open
air actually paying for it doesn't make it makes sense to me
okay i think i think they have i think they just fund us you
know i don't think open ai has the money but it's got the skill and that's all
they're doing is funding it yes it comes back at them
and it you know probably reduces their margins because of the circular deal,
as you explained.
But you know what?
When you read Bezos or listen to Bezos, listen to David Solomon, and again, I'm
repeating myself on this,
we know there are going to be catastrophes.
Some people are not going to make it.
Throughout the development of technology, and I'm going back to even the...
the uh you know the
1850s the industrial revolution uh there's always people who are going to fall by the
wayside but there will be winners as well
and big winners and you know and and and i think that's up to the businesses to keep
ahead of where of of
the competition and always be at the forefront this
will create yes there will be some bubble there will be companies that fall by you
know that that that fall by the way
but i mean at the end you can't ignore what's happening.
And you can't ignore that, you know, all this development is taking place and that
we will get the benefits down the
line.
It's not going to happen immediately and we can't foresee it happening down, you
know, but I think every day.
And, you know, Viv, you know, it was quite interesting and also just read an article
on the application of
this.
What happens is that, yeah, the firm doesn't apply.
You know, if you go into an accounting firm or whatever firm.
But singularly, people apply it.
You know, individuals are applying it and using their minds and using the tools that
are available to them.
So although the firm hasn't got an AI policy or might be looking at one,
individuals along the way, in terms of doing what they do on a day-to-day basis,
are starting to use these tools.
So it's very difficult to measure, you know, what the benefits are on looking at
a firm and saying,
what's your strategy and so on.
And I know from my own daily, in fact, at the moment,
I'm really trying to ask a lot of questions on gold.
Not gold, but we'll come to it in a sec.
Yeah.
Just on what this all means, you know, particularly from a reserve point of view.
Because remember, America still values its gold holdings at $42.22 an ounce,
which was, I think, goes back to the 1970s. You know, that was the official
price of gold.
So it's never revalued its reserves to 4,000.
So I'm trying to work out the consequences of that or the benefits.
So, you know, the dollar should actually be the strongest currency around if you're
looking at gold.
But anyway, so what am I using AI, you know,
to search and to find all the statistics, which would take me a mountain of time to
do it if I had to go through Google or
whatever.
It's fascinating, actually.
I was going to ask you this question, both of you.
Sorry, Viv.
You can digest this question while you come up with your next point.
Do you use AI for anything else than asking questions?
Is there any other aspect of your life that you knowingly use AI and wouldn't
have used AI a year ago?
Viv, you were going to say something, and then we'll answer that question.
We actually had a discussion in the office this week.
And it's an interesting idea.
Like, for instance, I know an advocate that's using AI to basically double his
workflow.
But the question, he doesn't double the amount of, like, advocate services that's
required in the country, you know what I mean?
So he's just charging a lot more for AI doing the work for him.
And that's probably what's happening out here as well.
So let's just say you have many more analysts out there, but analysts are
basically a zero-sum game because you're just buying and somebody else is selling.
And so it doesn't really increase economic activity.
The same thing applies to a lot of the stuff that current AI does.
It makes your life easier, but if you have everybody doing the same thing, the actual
net effect is zero.
The only way AI is really going to have an impact on the global economy, which it
needs to have, like I've always said, if you look at the amount of money being
spent now,
you're talking about 20 times that amount of money at least has to come through.
in terms of GDP growth to justify it.
The only things that are really going to move AI in terms of actually increasing
GDP growth in that level is either scientific discovery or
manufacturing, you know, mining, that kind of stuff.
Making more, like, I mean, technically, you go out and you make a video with Sora.
How does it add to GDP?
How does it add to, you know, productivity for the world?
It's very useful.
It replaces a studio out there.
And so, you know, we have more videos out in the world, but it'll really increase
productivity in the world.
Same thing with analysis.
I mean, David's reading stuff with gold,
but he's actually trading with somebody else who's also using the AI to basically
figure out the price of gold, you know what I mean?
And so both people are armed to a high extent.
The world's economic value hasn't increased.
So we need to see AI translate into physical world, manufacturing, or in the
world of symbols,
scientific discovery.
And we have not yet seen that come through and the kind of reason we need to...
see that come through is because we need to have those kind of like developments to
justify the current spending we're seeing one thing
that uh one thing that i've noticed from a personal point of view is that uh as a as
a broadcaster as a
podcast i've got this big clunky desk in front of me now i'm looking at it it's
been bolted into a suitcase for ease of
travel well i thought it was ease of travel and it's it's got all the sort of
buttons that you see you would see in a music studio and
faders and all that sort of thing.
And it was made for me by a technician from the SABC, what, 10, 12 years ago,
something like that.
And it served me really well.
Now I could buy the thing that does exactly the same as this in like the size
of a
tablet, for example.
And it's probably going to cost me about $500 in total.
And I could have started from nothing as a podcaster on day one just buying this
stuff off the shelf.
And the other thing that's interesting is that there are AI programs now to edit.
At the moment, I send my stuff to an editor in Cape Town,
and she gets all the ums and the ahs out.
And if it's a half-hour interview, it takes her 45 minutes to edit it.
This is a program that takes out all the ums and ahs for you, takes out the
background noise.
So if David's budgerigar, for example, starts tweeting in the background.
background linda yeah exactly your wife that's what i was going to say it'll take
the noise out it's fascinating so i could get rid of if
i was if i was a nasty person i could get rid of my editor in cape town and just do
it myself and it would say it would save me money
and the question was david do you use it from for anything else apart from writing
speeches and researching gold well
i think that's my you know that's my job so i use it extensively look i'll be
honest with
you You can't just take what you get back.
You know, in many cases, the information is old, doesn't look right, and you've got
to keep searching.
They do give you the references, you know, and you go back to the references,
and sometimes it is a little old and not useful.
But I think where it does come useful is if you sit through a transcript.
You know, for example, today, as you mentioned, it edits meetings,
and it gives you the minutes and action plans straight away.
literally straight away.
You don't have to employ somebody to go through the minutes, you know.
And likewise, I will get a transcript, which I'm going to do now, of the Ferrari
results and say, okay,
what are the, you know, what are the highlights?
What should I look out for?
And so on.
And it comes back and gives you a summary almost immediately.
Now, a lot of,
what would you call them?
A lot of platforms, sorry.
are already putting this in.
And you'll get a side column that will say, if you want to summarize what was
discussed, blah, blah,
we'll do it straight away.
So they're even providing that kind of summary and issue.
So you can get through what you want to in a fast way, especially if you've got to
digest a lot of information.
And where it suits you, you then go and start probing in a little more detail.
Because you know that...
When results come out, Lindsay, there can be so much nonsense and so much
superfluous stuff.
So it frees up time for you for more productive things or more productive
things for you as a person, i.e.
a nap or a walk or a run or something like that, which is also important and can't be
quantified.
Viv, I have to ask you a personal question now, and you can tell me to go and jump in
the lake if it is too personal.
You said bubbly.
Does that mean you're taking some profits for yourself and your clients?
No, because I think that trying to time these things is wrong.
And I'm fully invested in it.
And I think it's going to be like the dot-com bust, where if you had bought
Amazon before,
you'd be obviously suffering a lot when it fell 90%.
But you'd still be better off 20 years later having held on to Amazon at that
time as opposed to anything else you bought.
I do think that the technology is real.
The problem I have is that the size of the bubbly stuff that's happening right now,
it doesn't make...
sense from a from a from a logical point of view and that's when you get worried
when people are just you're throwing money at something without kind of like
considering what's the real value in it but no i'm i think buying into ai right
now and waiting 20 years or 10 years is going to be one of the
smartest things you do uh it might be smarter to wait maybe a few months and buy
a little cheaper but you know it'll be
terrible if you just miss out on getting in at the first place.
Well, you haven't missed out, and neither has David, and well done to both of you,
because I thought it was just another bubble.
It may still be, but I mean, even if it's a bubble and falls 10%, 15%, and everyone
says, I told you so, it's all over.
Of course, it's not all over.
This is with us forever.
I did an interesting thing the other day.
I put in to the few that I use, the few AI apps that I've got.
I've got Perplexity, DeepSeek, Grok.
um chat gpt co-pilot i think there's one other and i gave them all the same
question when did trump
start pretending to be a christian i use the word pretending instead of when did he
become a
christian because they'd all say well he was uh baptized in a presbyterian church
you
know with us because of his scottish background and everything but you put the
word pretending and and you get a completely different
answer from every single one.
Some will sort of ignore the word pretending or ignore the mischief making
of the word pretending.
And others will say, well, of course, this is all subjective and you can't say that.
But very, very interesting the way that their different minds work and whether
they're a Musk AI app or
Chinese AI app, for example.
Do either of you find that, David, for example?
You know what you're saying?
I think this is a problem.
It's not picking up the nuance.
You know, it's taking the pure question and said, yes, he was baptized.
But what you're trying to say is, you know, it's much more, what's the word?
Subtle.
Yes.
You know, saying pretending.
No, they picked it up, David.
And therefore it doesn't pick that up.
It actually did pick it up.
It did.
What I'm saying is that some people said they quantified the word pretending.
Yes.
They almost...
Terms and conditions came in immediately and they wrote a disclaimer by saying
certain things right at
the beginning.
So it was fascinating.
I'm trying to come up with really, really difficult questions for them.
And again, Viv, Trump was talking the other day with Mark Carney in the Oval
Office.
And he said he was talking about the Middle East and he said this could be a
piece in the Middle East after so many years where.
Millions.
He said, no, tens of millions of people have died.
And I thought, wait a second, that's wrong.
So I immediately went to Grok and I said, did he just say tens of millions?
And he said, and they said, yes, and he did say it.
And this is what he said.
And it was this was the context in which he used it.
And this is the history of what when he said it in the past.
It was fascinating.
It was five seconds later, Viv.
And you two have converted me.
Yeah, no, look, I mean, it does add this extra belief.
My question to you is that any of these use cases increase the global GDP, you
know,
and that is the thing that we have to see global GDP increase.
And we are talking, I mean, to justify current spending, like I did this
calculation a while back, and I told you guys about it,
you need to have like five plus percent of GDP growth per annum to justify this kind
of spending.
You know what I mean?
And what does that it's not going to be like, you know, having a more, I mean,
Wikipedia, for instance, imagine Wikipedia, right?
How much benefit has come to your life for having Wikipedia?
I know for mine, a huge benefit.
Wikipedia, I still ask every time I go there for like $20, you know what I mean,
or $5 or whatever it is, begging for money.
It's four euros over here, so we get it cheap.
Yeah, yeah.
But I'm saying to you that Wikipedia is one of the most useful things ever
created,
more useful than Coca-Cola or McDonald's by any definition, but it doesn't add to
the GDP of the world.
And it doesn't make financial sense, you know, from that point of view.
I mean, you can argue whether economics is good or bad, but I'm saying to you that...
That's my argument, that you use it.
So in a way, it's making you more productive, even though you can't quantify
it.
Yeah, but it doesn't make Nvidia or OpenAI or Facebook make money, which they are
basically spending money to make.
You know what I mean?
That's the question.
That is the question around AI, is that it makes the world a much better place.
I don't say no to that, but...
Does it translate that 100 billion that Microsoft spent on it?
into money that Microsoft gets back in any way.
Yeah, I think we're going to have to live with that.
That's what I'm saying.
There are going to be casualties.
We're never going to be justified.
But as you mentioned with Larry Page or Serge J.
Brun, whoever you mentioned, you know, they know that they have to keep doing it.
You know, they can't fall out the race.
Otherwise, you get an Intel situation, Cisco situation, you know,
all the other situations that we've seen from the start of technology of companies
that just lost their way.
you know never kept up so that's why i'm saying you know from from my point of view
i'm not getting out i
would rather i'd rather continue with ai than start to look at gold or anything
like that which is just uh you know just
just a FOMO deal you know so
i'm saying there's something real it was in silver yeah i saw it's over 49 yes
david where
is it now it broke 50 good lord broke 50 50 70
It was 32.
It was 32 EB.
I can remember silver being like four, five,
about between $5 and $10 an ounce when I first started in the business.
Yeah.
What does silver do?
Who uses silver?
I don't know.
Somewhere along the line for who you exactly.
Anyway, this is one conversation that you just kind of avoid taking public because
you get in front of a...
You know, it's like religion.
When you start to talk about religion, just make sure you know what you're
talking about.
You've studied the Bible, you've studied whatever you need to do, Koran, whatever.
But it's like with gold, don't get in front of those gold bugs or anything,
you're just going to get taken out.
So be quiet.
I spoke to a gold bug the other day, a fund manager, he's a gold bug, and he's
very good, but he's got this thing for gold, he's a South African,
I mean, what do you expect?
And he was almost hyperventilating when he went through the numbers of the miners,
because it was a day when the JSC was shooting up mainly because of the miners,
the resources index was flying.
And when I started to talk to him about gold, he got either emotional or he
hyperventilated.
It has that effect, but it should do as well.
It's doubled in two years.
It's quadrupled in 10 years.
And when Gordon Brown, that...
The useless prime minister sold Britain's last gold.
That was $252 an ounce.
He sold Britain's last bit of gold that he could sell at $252 an ounce.
And now they're probably buying it back at $4,000.
So here's my conundrum.
Okay.
Gold's gone up to over $4,000.
I don't know where it is now, but call it $4,000 an ounce.
Yes.
America who back at Bretton Woods,
took over from gold with a dollar as being the reserve currency of the world.
In the 1970s, I think Nixon took America off the gold standard.
But still, in order to even be on the gold standard, they had to have huge amounts of
reserves,
which they have maintained to this day.
They haven't really added.
But they've got massive amounts of gold hidden at Fort Knox and various other
places.
Wherever.
I don't know how many thousands of ounces, by far the biggest world's gold reserves,
but they still value them because of the illiquidity at $42 an ounce.
Today it's $4,000 an ounce.
100 times cheaper now.
Yes.
So now, surely,
if the American currency is now supported by those huge amounts of gold, you know,
you would buy the dollar.
You would say, hold on, This is the strongest currency around.
You know, why do I need to go elsewhere?
Look for something else.
Every time gold up, it actually should be strengthening the dollar.
But America, that doesn't happen.
And the danger is if you do revalue it, it gives the Reserve Bank or the
Fed Reserve huge margin to actually increase money supply and go out on a...
Please don't tell Donald.
I hope Donald Trump doesn't listen to this.
It probably hasn't occurred to him.
But what I'm trying to do is, Lindsay, I mean...
Viv's there.
I'm trying to say, hold on a sec.
This doesn't make sense.
You know, the dollar should be roaring on the bank of the gold price.
I'll give you a step to blow your minds, okay?
Here we go.
You know who has the most gold reserves in the world and it's not the U.S.
government?
No, go on.
Indian private households.
Yes, yes.
I would buy that.
Under the bed or in the bank?
I will buy that.
Private households in India hold something like four times as much gold as U.S.
government.
I will buy it, yeah.
Well, it's very customary, isn't it?
Traditional.
Yeah, yeah.
I mean, in India, like in South India especially, people just buy gold.
It's like a cultural thing.
They have about 20, according to the guesstimates out there,
they have about 25,000 tons of gold in private hands in India.
The US government only has about 8,000 tons.
That's right.
You know what I mean?
Yeah.
They're not going to go around.
They're not going to be able to go around and get every Indian household together
and say, listen,
come and deposit your gold so we can boost the rupee.
No, no.
But the thing is that gold is something that's important.
The important thing is that Nixon was able to do that was because the U.S.
was such a dominant play in the global economy that the dollar became the new
gold effectively.
Right.
and reserves around the world were replaced.
gold with dollars effectively.
But what's happening right now is the reason that we're going back to gold
partially is the fact that we're no longer going to the,
in a world where the US dollar is automatically the reserve currency of the
world, you know what I mean?
It still is, but it's not automatically going to be that going forward.
And many central banks especially are swapping out dollars for gold.
And that's one of the reasons we are seeing what's happening here.
So the gold stuff happening is interesting.
And then what's happening with platinum and silver we talked about.
is I think the fact that gold rises and then these ratios basically are maintained
over time.
There's actually a gold ratio of platinum to silver and a gold ratio to platinum
that's like, you know, you could trade that as well.
And so I do think that that's the story.
It's not so much gold that's important.
It's why is gold going up?
And one of the reasons it's going up is because the Chinese and the Indians are
looking and saying, even the Europeans are saying, maybe not so many dollars,
maybe a bit more gold in my account.
It's interesting, isn't it, David?
You talk about that.
Sorry, Davey, you talk about them not revaluing gold,
but I'm sure they're aware of the fact that they've got the stuff in spade loads
underneath Fort Knox.
But it's an interesting sort of visual here that Trump phones up Stephen Miller
and says,
listen, we're supporting Argentina to the tune of 20 billion.
Why don't we just send them 20 billion dollars worth of gold?
Go down to Fort Knox with a couple of trucks and go down to the docks.
It's just like...
But, you know, there's so much of it.
Surely they can asset back the dollar, as you said, with gold to do things like
that.
They could.
I don't know why.
It just hasn't moved.
You know, they haven't touched this in decades, in absolute decades.
They're not involved in the market simply because they still have the world outside
of what Viv says,
which I understand, you know.
is uh look the other thing is it's pretty much I don't think as much as the Indians,
but I mean,
certainly Europeans traditionally have always, you know, accumulated gold,
particularly the Swiss, particularly,
you know, Germans.
I don't know, you know, other people in Europe.
It's been a traditional haven for gold, but no one uses it.
You know, that's the thing.
No one's actually using gold.
It's just kind of a reserve.
One day when those Indians want to sell it.
Well, the merit go, who the hell is going to buy the stuff?
And that's the irony.
And that's why I'm saying, look, I'd rather be an AI bull.
And even if we look at gold, it's up 40% this year.
My NVIDIA is up over 40%. All right, so NVIDIA is up 40% or something.
Okay, I'd rather have NVIDIA because I know where NVIDIA can go and I know where
gold could go as well.
Okay, very quick one now.
And that's David again, Viv.
David on Monday, kiss of death, said there's been a recovery in luxury stocks.
Today, of course, Ferrari fell after a trading update by the most in its history,
I think,
because of a trading update, down 16%.
David, they brought out an electric car, but it wasn't that that did it, was it?
No, no, I just think it's the outlook.
The results per se were good.
but they've just toned down their outlook right through to 2030.
And I think it's really a reflection of issues in the motor market.
I mean, overall, you've seen Aston Martin, Porsche, all of those come down.
I think there's chaos in markets.
I think the Chinese have just, you know,
just kind of destabilized all the traditional markets.
And I can understand why.
You know, I understand.
It makes a lot of sense.
Most people just want to go from A to B, and if they want an electric vehicle to do
the same, the Chinese are supporting them.
You don't need the fancy cars.
But I think...
The one thing I like about Ferrari is it limits its output.
You know, it's a very small producer globally.
And I still trust the brand, you know, even though they've toned down the outlook
for electric vehicles and it'll be a much
slower, you know, performance there or they expect it to be a lot slower.
And I still think it's a very solid quality brand that people aspire to.
I walk around New York, I see the kids.
They've either got Man United shirts on or Ferrari shirts, both of them.
It'll be an ASML story.
I mean, ASML came down this year because of a trading update, I think it was.
And look, as you said the other day, David, it goes shooting up again.
The same thing will happen with Ferrari, I'm sure.
I'll give you a stat that will tell you why that may not be true.
In the last 40 years, the number of people that have driver's license in the US has
dropped dramatically.
I mean, I think around about 97% of kids, like 20-year-olds basically, in like an 80
had a driver's license.
It's like 75% now.
And I think over time what's going to happen is that, I mean, I like luxury
goods.
I think if AI takes off, we get 5-10% global GDP growth rates.
Luxury goods are going to be in demand.
I don't think either that luxury cars are going to be something that's going to be
around.
It's going to be like horses.
Yeah, back in the day, all the rich guys wanted horses.
You know, Viv, the one thing about Ferrari that I can't comprehend.
you know that just doesn't make any sense if you go to there's certain people the
rich people they've got four
five ferraris you know i mean that's you're in a different caliber they don't
they're not buying a car to get from a this
is this is like a collector's item it's the same as those who buy these burking
bags you know ladies who buy burking
bags like they got five six ten of them you know what i mean and it's just such a
different market
It's not something that I understand, believe me.
There's even a Ferrari, David, that you buy but you can't drive, isn't there?
Isn't there some special...
Yeah, there are some.
Yeah.
It's the 50-year-olds, it's the 60-year-olds that have these Ferraris.
The 20-year-old kids don't.
Oh, by the way, I don't know if you guys saw today, did you see the raid in South
Africa, have you talked about it yet?
No.
Where that Manuela Trust, I think four or five Lamborghinis were taken out of his
house.
This is the guy that was accused of the tender fraud, the two billion run tender
fraud.
And apparently they started to raid the house and stuff.
And so they're taking these things out.
But the thing I see right now is that I understand why people want the Ferraris.
But do you think Elon Musk is buying Ferraris?
Do you think these kind of guys are buying Ferraris at the moment?
That's not what they're doing.
And I see youngsters myself.
I mean, we have a young lady working with us.
She makes enough money.
She doesn't have a car.
she ubers everywhere uh and yeah and and and she says now she's like it's more
useful it's like you
know whatever and and i think that is the future driverless vehicles and that kind
of stuff but luxury goods i i think the birkenbags going to be
around i think the the luxury brands are going to be around people are still going
to buy those things but cars i think are going forward well in
that case i'm a trendsetter i'm not a trend follower i'm a trendsetter because i
haven't had a car for nine years and because i moved to the netherlands public
transport and uber do me absolutely fine.
Why do I need a car?
Why do I have to be behind the wheel and get stressed out and get road rage and
shouting obscenities in Dutch or trying to in Dutch to Dutch
people who can't drive properly or German tourists?
I'm much happier letting someone else take the strain.
Thank you.
So, Lindsay Williams, trendsetter yet again.
Viv, I interrupted you, I think.
No, no, no.
I think luxury goods are going to be a thing.
I think if you were to be playing the ball in the next 10 years, maybe AI companies
themselves might not be the...
the things to go to.
But I think imagining a world that's significantly richer 10 years from now is
not a bad way to think of things.
And I think if we do that, if we do expect 10%, 5% GDP growth rate, maybe not buying
Microsoft, but maybe buying the luxury good brands that are going to be what are
these millionaires going to spend their money on,
or buying the high-end apartments where all these millionaires want to go and live
in their fancy lives out,
might be an interesting way to approach the AI bubble.
or the AI trade, let me see.
There's an apartment block with views of Buckingham Palace and the only people that
they're allowing to come and
have a viewing are certified billionaires.
Most of them are American, I might add.
I don't know how many billionaires have been created over this last two years with
AI,
but I'm sure there's been a big spike in them.
Anyway, we're talking fanciful stuff here and I'm going to have a look at the
markets because the dollar ran.
It's 17.17, which has barely changed.
The British pound against the round, 22.82.
And the mighty euro against the round is 19.85.
The euro against the round, rather, the mighty round, 19.85 now, which is
gratifying.
Euro dollar is 1.1560.
How can the dollar be strong, the euro be weak, and the gold price be strong as
well?
It's got to be that fear of missing out trade in gold.
It has to be.
How can the gold go up?
and the dollar go up and the stock market go up.
It doesn't make sense to me.
Gold price itself is down today by 0.7%, about as much as the dollar is up.
4,010 is that yellow metal, was 4,050 yesterday.
Platinum, 16.90, which is down $11 an ounce.
Palladium has been doing well, up 100 yesterday, up 29 today to 15.12, closing
in on platinum.
That's a big one, up nearly 2% today.
and other commodities.
The one that we've added to our list in the last few weeks has been copper because
of its, because I just think it's going up,
but also because of its South African links suddenly with the Anglo story.
$5.11 and a bit for copper, which is a new recent high, up over 2%
on the day.
Crude oil, $62.24, that's for West Texas, down 0.5%, and Brent crude oil down 0.6%
to $65.84.
Elsewhere, another speccy one.
is Bitcoin went to 125, now just below 121.
That's down 1.1% on the day.
South African 10-year bond homing in on 9% on the downside.
It's 9.05 at the moment, that yield, so the bond market's strong.
And the US 10-year bond, the yield up very slightly to
4.15%. S&P 500 futures went above 6,800 for the first time yesterday,
down today by a third of a percent to 67%.
6,776 for S&P December futures.
David, stocks up and down on the JSC or any news on the JSC that caught your eye?
Not really.
I just think that there's been a little bit of a sell-off in gold shares and in
platinum shares.
And the odd thing is that there are a lot more gainers than there are losers.
But market down 0.67 of a percent.
A little bit of easing, mainly because of the sell-off in gold and platinum shares,
but banks quite strong.
I'm not quite sure what's driving that,
whether it's just a belief that rates are going to come down and things are starting
to look
up there.
But banks have been just picking up slightly.
There haven't been performers this whole year, but I think we're starting to see a
bit of money.
There must be a lot of money just floating around trying to find a home.
It can't all go offshore.
So I'm sure a lot of the market is propped up by just the weight of money.
You know, property also up a little bit as well.
It's also been a sector that's benefiting from, as those long-term rates come down,
you know,
property shares start to pick up as well, you know, on valuations, on yields.
So, yeah, overall a good day, 25 billion traded.
Okay.
I think Viv's eyes glazed over when you started talking about that, when I started
talking about it.
the JSC.
It is still a part of your life, isn't it, Viv?
I've just said JSC has outperformed, but you talked about the banks.
Look at APSA's P-ratio versus dividend yield.
It still gets me just how cheap they are at the moment.
The market is pricing a lot of negativity about our banks still.
If we had a reasonable P-ratio, a real reasonable dividend yield on this thing
here,
I would suggest a company like APSA would be significantly higher than it is right
now.
John Bickhardt would love you for that because exactly what he's been doing, one
of his biggest holdings.
On the JSC today, Sappy bouncing back by 6.2%.
South 32, three and two thirds percent higher.
First round, a bank up 3.3%.
Discovery 3.1% to the good.
And pick and pay yesterday was up about 5%, I think.
Today up another 2.8%.
On the downside… There's a trading statement out, yeah.
Oh, was there?
Which I think is moderate, yeah.
Okay.
There's nothing brilliant about it, but… probably slightly better than the market
expected.
If you take Boxer out of pick and pay, there's nothing left.
I won't say anything.
I think the price of pick and pay actually probably reflects its holding in Boxer,
which is a sad reflection of a business that once dominated the industrial sector
of the
market.
On the downside, the JSC's resources stocks have given up everything that they
gained yesterday.
I mean, look at Sibania, still water down 7.4%.
Advertec, not a miner, of course, but that's down 6.1%.
That must be an ex-div story, I think.
Impala Platinum down nearly 5%.
Pan-African Resources down four and three quarters.
And Valterra, formerly Anglo-American Platinum, down 4.7%. So, you know, good
day yesterday,
bad day today.
The technicians will be looking at this.
I know they'll be looking at this.
They'll be looking at the new highs on the resources index.
They'll be looking at the new highs on gold.
They'll be looking at the sort of mini reversal pattern today.
And they'll be screaming sell on these things.
They've been waiting for this sort of thing.
So watch out for the close this evening.
There may be some money coming in on the sell side.
David?
When I look at the charts, and I'm not a technician, but when you look at the
charts on some of those gold shears.
gold itself, you know, it just screams, okay, this is dangerous.
You know, this is seriously dangerous.
And that's why I think it's very difficult to, you know, to stand by it at this
stage.
I'm not saying for those who've got it.
So, yeah, it is from a technical point of view, I can't see people being bullish.
Gentlemen, I've kept you far too long, but thank you very much.
We had lots of catching up to do.
David Shapiro is from Sessom Securities, Viv Govender from the award-winning Ram
Swiss, and that was the 5 o'clock shadow.
The views and opinions expressed in these podcasts are those of Lindsay Williams and
various contributors and do not reflect the policy,
position or opinion of any other agency, organisation,
employer or company associated with StrictlyBusinessPodcast.com.
Assumptions made on the analyses are not reflective of the position of any other
entity 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.