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  yeah I completely agree with this. the only thing which stresses me in SA is safety and security and until I can feel safe there with my small kids, the place remains an abyss....  

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The smart money is long gone; when will the rest follow?

SA’s credit downgrade started years ago.

There is a somewhat-misplaced view that SA’s imminent credit downgrading will be a once-off event, followed by some market volatility, temporary downward pressure on the currency and equity market and then it’s all back to normal.

There’s also the forlorn message that some local financial institutions are putting out into the market place: that the markets could actually recover once the downgrade becomes fact. This is all done in an effort to convince their clients not to redeem funds and move money offshore – which has been happening ever-increasingly during the past two to three years.

Who knows what will actually happen when and if one, or perhaps even two, of the three large credit ratings agencies drop our rating to sub-investment grade? Both S&P and Fitch are busy preparing announcements to be made in this regard over the next month or two. And, judging by the release of a raft of worse-than-normal economic indicators in recent days – particularly unemployment which has rocketed by almost 2 percentage points to 27.6%, the outlook for a stay of execution has worsened considerably indeed.

Betting on a downgrade

I’m not a betting man but I would wager a handful of my biotech shares that we’ll soon be downgraded, if not in June, then in December this year.

The truth is countries get upgraded and downgraded almost on a daily basis by the markets: an on-going process rather than an event. In most cases the official downgrade is just a final confirmation of what most intelligent role players have known for a long time. And for the past five years and more, the consensus by the large global pools of capital that swirl around the globe started the downgrade process – long before Moody’s, S&P and Fitch officially started doing so.

The downgrades by these ratings agencies, ongoing since 2012, were in fact confirmation of what the ‘smart’ money has been doing for more than five years. This has been evident in the rand’s decline against other currencies: from levels of 6.60 against the US dollar in September 2011 to around 15.40 as of Friday May 13.

This trend is also clear to see in the astonishing under-performance of the JSE against all other major equity markets and regions in the world, even recently against its emerging market peers. When I tell investors that an investment in the S&P 500 five years ago returned more than three times that of an equivalent investment in the local market, for instance the Satrix 40, they seem utterly unable to grasp the consequences of such a statement.

The following table underscores the heavy underperformance of the JSE versus the major global equity regions in the world:

image001

 

First movers smiling

The first-movers who diversified into global markets five years, three years and even one year ago, have increased their personal wealth substantially when compared with keeping their equity exposure 100% allocated to the local market.

From personal experience, the decision to move offshore five years ago has been life-changing. It’s common knowledge that I moved all my equity investments offshore in October 2011, at a rand exchange rate of R6.80. Even my worst-performing offshore equity funds have doubled the return I would have had had I succumbed to home-bias and stayed put.

I don’t think it’s going to change very soon. And while I’m not as bearish as economic commentator Chris Hart who sees a rand at R60/$ within 30 months and a possible IMF bail-out, I do think we’re heading towards R20 before the end of the year, especially if we get the downgrade I expect we will.  

In the meantime, ordinary investors planning some kind of wealth for them and their families are being impoverished by the squeaky-clean and heavily politically-correct information masquerading as investment advice.

In a previous column I wrote about the fact that your residential property has not grown in real terms in over seven years (and could actually start declining in nominal terms soon). Rental growth has gone negative over the past four years, while even the stock market has not beaten the inflation rate over almost three years now. So your local investments have not made you any real money.

At the same time, BankservAfrica’s gauge of disposable income shows it barely keeping pace with inflation. So, like almost everyone in SA but the super-rich, on a GDP per capita basis we have become poorer over the past five years.

Moody’s: read the small print 

The recent news of Moody’s leaving SA’s credit rating unchanged, was immediately pounced upon by the government, the ANC and some of our shallow media, pronouncing that all is well and that SA is turning the corner. I would suggest that they carefully read Moody’s document again.

Yes there was good news in that we were not downgraded, but the outlook was changed from stable to negative. Further on it warns very clearly that if growth does not pick up soon, we will be downgraded.

It also warned that the state of our State-owned enterprises (SOEs) is a cause for concern and is adding to the overall debt burden of government. What does President Jacob Zuma say barely three days later? “We will never ever privatise SAA (South African Airways), our national carrier” – a clear message to the market on how the issues of the under-performing and even non-performing SOEs will be dealt with: using more taxpayers money.

If this was not bad enough, news broke very soon thereafter that the government is considering buying a new airliner for Zuma at a reported R4 billion. A ‘Nkandla in the sky’ as someone described it, while we as an almost-broke country steam towards a credit downgrade to sub-investment grade.

We have 127 international airlines flying in and out of OR Tambo almost on a daily basis. Anyone can reach almost any destination in the world either directly or with perhaps one connecting flight.

Many countries, far more important on the international scale, do not have private jets for their political leaders: they fly their national carriers like everyone else. 

Smart money left long ago

Some South African companies long ago started diversifiing their businesses and income streams away from the motherland and increasingly invested in other parts of the world. Now, barely a day goes by without the media reporting on listed and unlisted companies buying up offshore shareholdings. The outflow of local capital in recent years has been huge. While the SA Reserve Bank is very coy on the numbers, I’ve seen stats that indicate corporate outflows of R84 billion in 2014 and R68 billion in 2015.

These numbers exclude the outflow allowed for private individuals in terms of their offshore investment allowances of R10 million per person per year. It is it not uncommon for wealthy families to have moved most of their discretionary wealth offshore. It is possible to move as much as R60 million in less than 14 months, all legal and so far very financially rewarding.

This is money that could have been invested in local financial markets and even startups in order to create absolutely vital jobs. But why would you risk your family’s wealth in a business that could soon be subject to even more draconian requirements or worse, confiscation in terms of the Expropriation Bill, currently before Parliament.

In farming too there is legislation winding itself through Parliament that could give the State the power to confiscate part of your land if over a certain size. So why would you as a successful farmer with surplus capital want to buy more land in order to expand your farming operation to benefit from economies of scale?

Foreign shore beckon

Approximately 8 000 SA millionaires left the country between 2000 and 2014, according to research firm New World Wealth (NWW). Since then I would hazard another 2 000 or more have upped and left, bringing the official tally to about 10 000 or so. At best this is a rough estimation but it does indicate a disturbing trend: wealthy families and individuals with skills and money, especially younger ones, are leaving to pay their taxes and create jobs in another country.

Many leave for better opportunities and the chance to broaden their life experiences by working in other countries and cultures. The advent of the internet has also made this much easier. Many types of business can be run entirely via the internet. Many also leave because they are concerned about their future in SA.

Can this situation be turned around? For the sake of our children and grandchildren I desperately hope it can.

What needs to be done to correct the destructive path we are on? 

In a piece on the Helen Suzman Foundation’s website, Iraj Abedian, founder of Pan-African Capital offers the following suggestions:

  1. Improve business confidence, currently at record low levels, with policy consistency and ethical governance.
  2. Curb trade union militancy.
  3. Foreign investment, absolutely critical, needs to be encouraged, not discouraged as government seems to be doing.
  4. SOEs need special attention and must stop being the playing field for political patronage and rent-seeking.

 

Considerably more needs to be done, but at least this is somewhere to start. It all boils down to leadership.

 

*Brenthurst Wealth in conjunction with Moneyweb are hosting a series of seminars called SA-Quo Vadis ? over the next two weeks to discuss these issues. Speakers include Dr Frans Cronje, director at the SA Institute of Race Relations, Ryk van Niekerk, editor of Moneyweb as well as Paul Hansen, fund manager at Stanlib.

Seminars will be held in Pretoria on May 16 (CSIR), Johannesburg on May 18 (Pharmaceutical Society), Paarl (Val de Vie)on May 23 and ending up in Cape Town (Crystal Towers) on May 24.

Booking is essential as the Pretoria seminar is already sold out. To book go to:  https://goo.gl/yoA0Cn  or www.brenthurstwealth.co.za

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Martin de Kock

Martin de Kock

Ascor® Independent Wealth Managers
Moneyweb Click an Advisor
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in years to come one name will stand out as someone who constantly pointed out the issues going forward – that WILL be MAGNUS HEYSTEK. For his foresight all he got was buckets of excrement thrown at him (sounds similar to moi). however one area I violently disagreed with him was that in addition to moving your funds off shore – one should moves one’s family! his response was the usual “had nowhere to go”. well that is true NOW but in the 80’s and 90’s there were places which would gratefully accept people like magnus – but alas all too late. so in the words of fw “fasten your seat belts” and of course get yr funds off-shore WHILE YOU CAN!

The prophet of doom has once again uttered excitement from his lips.
Hindsight correct ones vision to 20 / 20 as it has done in robertthebul$h1tters case.

@sweetpea..

..robertinsydney does bemoan but I have to agree with him that Magnus Heystek is seldom venerated for parting of good advice that incidentally more often has proven true.

And face it, contributors like yourself and others, including robertinsydney add good discourse. Without I would not visit the comments section and read the opinions of those for or against the articles written for MoneyWeb.

@sweetpea – I think you meant excrement not excitement.

Robert, the problem is not your advice, its you. You left SA with your tail between your legs for a country you had no hand in building. By the way, just what do you do in Aus? You would have been the 1st person of the Titanic. Before the women and children. Most people stuck in SA cant afford to leave (due to circumstances or finances). You, however sit in judgement. Lets look at your life partner Magnus. He is not concerned about the average South African. He is far more concerned about the commission and trailer fees he will be earning on all the offshore Investments he facilitates. His advice is far from being unbiased. Most South Africans already have offshore assets (Flats in London etc). Why pray tell should you use an advisor that decimate your returns because of all the fees. If you do a bit of homework you can invest yourself with low cost tracking funds. Robert you should be making friends with all the Chinese flooding your country (after exploiting China) – But of course they now have enough money to qualify for citizenship (irrespective of how they made their money) – Yet your perfect morally superior country turns away refugees by the boatloads.

@Gemini…old Rob In Oz loves the opportunity to tell us about the endless number of great decisions he has made so be prepared for a lengthy list of achievements.

I quote “Most South Africans already have offshore assets (Flats in London etc)” is that so? when I went to school “most” meant more than half!! methinks not!

You can list all the negatives about South Africa and how wonderful Australia is, but fact is Australians still see you as a bloody foreigner stealing their jobs and the homesick feeling you have just won’t go away.

I have spent more than a year in Sydney and never felt that the locals would consider me as a bloody foreigner, just the opposite, Australians far more accepting foreigners that South Africans. Unfortunately I am too old to move there. I never heard of foreigners getting lynched in Australia, but in SA it is a regular happening. Cape Town is the worst, if your family is not a 4th generation local you are a foreigner. Since we moved to CT we seem to socialise with more JHB expats than real locals.

As the going says they all tell about the bets that made money. The likes of Coronation & PIC lost money to ABIL. So none of these guys are experts at investments they just made a lucky call. From R6.8/$ the rand could’ve gone either way.

Robert your smug comments are not really appreciated by very many. You appear to have very little to do in Sydney other than to pour over your keyboard and proffer advice to all and sundry in South Africa. You have left, you have gone – do us all a favour – we know what we are dealing with and need no comment from you.

There is certainly a level of political risk in SA but also in UK and US. The rand depreciation has more to do with the commodity cycle because we export mainly commodities. As for offshore market the S&P500 is overheating, sovereign debts are through the roof. There is really no where to run at this point. Perhaps parking money in gold is the most sound advise until this madness goes pear shaped and you can start looking around for value in equities. In the late 90s the like of Old Mutual & Anglo ran to London and workers went to London in numbers, 2008 came and they all wanted to come back until the frauds(central banks) started pumping liquidity in those markets effectively building a house on sand. Watch when the sovereign debt bubble finally bursts and most of you will be on your way back.

well I don’t think you do!

It’s amazing… some people just don’t know when they are not welcome. Robert… You gave up your right to comment when you left SA. Go away. Nobody needs you! You are either part of the solution or part of the problem. You are undoubtedly part of the latter.

It is always darkest before dawn!!! This is the time to invest in SA!!!

I love reading Magnus and I agree with his (seemingly pessimistic) outlook. It makes a lot of sense. We have a huge problem in SA…without any easy solutions.

When I visited Australia recently, however, I didn’t give a hoot about what’s going on in SA; I enjoyed my time and was quite envious of the kind of relaxed lifestyle Australians have.

Which brings me to the point I am trying to make: if you are so very happy in Sydney, Robert, why on earth are you even bothered about what is going on in SA? We would all like to live in Australia if we could, but definitely not if it turns out to be awful enough to bully those who decided (on didn’t have a choice) to stay in SA.

Why don’t you become an Australian and forget about SA? You would do us all such an immense favour!

For those of us who are invested in JSE-listed companies with an international footprint with income in Dollars and Euro or Yuan, South Africa is the best place to live. The disastrous anti-business policies of the ANC government does not affect those offshore investments much, but it is very effective in lowering the real cost of the wages locally. The unintended consequence of ANC policy is the over-supply of cheap labor.

An average income South African household can afford a permanent domestic worker and gardener plus 24 hour security with guards on call. In Australia, Europe and America you have to be a billionaire to live in such opulence. A millionaire in South Africa has the same standard of living as a billionaire in Australia.

If you enjoy doing your own dishes, washing, ironing and gardening, and if you can tolerate Aussies, then maybe Australia is the place for you.

Better still, have all your investments, apart from your physical property in a portfolio of global stocks (Investec Global Franchise is a food example) linked to a foreign debit card so you can enjoy SA but build your wealth in US dollars!
Live in a hot climate but keep your money in a cold climate, they always say.

Is it too late now to invest offshore? I have an Offshore Unit Trust which has done very well. Been running since 4 years back.

It is probably too late. The business cycle will turn soon and the Rand will strengthen as usual. You don’t want more than 50% of your assets in overseas investments, because you will be adding too much currency risk. Just a thought.

people in USA, Europe and Australia DON’T need 24 hr security with guards on call! anyway these so-called “security estates” do not provide security as in the case of the Van Breda family – and then you want to go for a walk/run and end up like that poor girl in the tokai forest. if this is what you call living – good luck – I call it surviving~!

Robert, the problem is not your advice, its you. You left SA with your tail between your legs for a country you had no hand in building. By the way, just what do you do in Aus? You would have been the 1st person of the Titanic. Before the women and children. Most people stuck in SA cant afford to leave (due to circumstances or finances). You, however sit in judgement. Lets look at your life partner Magnus. He is not concerned about the average South African. He is far more concerned about the commission and trailer fees he will be earning on all the offshore Investments he facilitates. His advice is far from being unbiased. Most South Africans already have offshore assets (Flats in London etc). Why pray tell should you use an advisor that decimate your returns because of all the fees. If you do a bit of homework you can invest yourself with low cost tracking funds. Robert you should be making friends with all the Chinese flooding your country (after exploiting China) – But of course they now have enough money to qualify for citizenship (irrespective of how they made their money) – Yet your perfect morally superior country turns away refugees by the boatloads.

Robert, the van Breda murder was unique by any standard and nothing was stolen, hence financial gain was not the logical motive. Nonetheless you guys sitting overseas are always so proud to say “in Aus or New Zealand or the UK you can walk alone in the streets at 01:00 in the morning and still feel safe”. The fact is that at 01:00 in the morning I am fast asleep in my bed, tired after a hard day’s work (and drinking a very good bottle of wine for just R100 at dinner). So I really have no longing to go wonder out on the streets on my own at 01:00 in the morning. They privilege you can really keep that yourself. Better still, save your energies for doing your house chores on Saturday and Sunday like the ironing, washing and gardening. I will be out playing golf and my wife at the spa whilst you happily do your chores. Did I mention we have a domestic every day of the week???

“over-supply” of cheap labour – sounds a VERY racist comment . as does “exploitation of the masses – just like what happened in Russia and Cuba before the respective revolutions. suggest you re-read the history of these place as to what happened to the bourgeoisie in those countries

@Sensei, with respect (i enjoy your posts), I just cannot fathom how you come out at “South Africa is the best place to live”

your home and that of your family must stretch beyond the bank / investment account. what about the abject security situation, the failing infrastructure, the MASSIVE unemployment issue etc etc.

If/ when I leave SA it will be less about the cash and more about the broken social contract. I would love to invest my time and resources into contributing to a new SA. but without security for my family and a few other important requirements like stability of education I cannot make that commitment.

SA is already broken. all Magnus is describing here imo are the symptoms.

Bertie I am only trying to make the best of a bad situation my friend, and give robertinsydney something to think about. In all honesty, if it is only my domestic worker that keeps in me in SA, I should have been gone a long time ago….

I am very concerned about future anarchy in SA. The critical factors are present, rising unemployment, a sense of entitlement under the unemployed, a culture of violent protest, a culture of violence and rape( the worst stats internationally), rising food prices and opportunistic politicians. If it was not for the constitution and the police force, the wave would have engulfed us already.

So I am with you…

@sensei I know very few families with full time domestic and gardener. Unfortunately the 24hour security is not a question of affordability but necessity in most major cities in the country. We had full time domestic last time more than 20 years ago, but I never liked that a stranger had access to everything in our house, but I did not grow up with servants.

When robertinsydney has started the comments, I will stand down.

Magnus, you have raised interesting and valid points. Happy for you that you have increased your wealth by getting your rand call right. Forecasting currencies is a useless and dangerous game. I have no idea where the rand is going over the next 12 months. Granted, there are many variables that should see it deteriorate going forward. What if the rand recovers to R10? Investors’ offshore returns would be decimated. My strategy is to shoot for longevity rather than take big bets (gambling). Have a diversified portfolio (various asset classes and global exposure). Buy cheap assets and sell them when I have realised decent returns. The gloom and doom premise is not ideal in investments. I hope you have hedged your currency exposure.

Can it be that Magnus has taken some advice from that guy who fled they country years ago and lives in Sydney? He writes under the name
robertthebull$h1tterinSydney

I think there is much more chance of the Rand dropping to 20 to the dollar than strengthening to 10.

My take on the current economic crisis is to be conservative, diversify as much as possible, and hedge your big bets. MANY people ran offshore with their money in 2002 and got burnt really bad. I remember times when people stored tinned food ‘because SA is going down the drain’. We’ve seen much worse in our country, and we’ve always been able to fight it out and survive. South Africans are survivors.

I was taught as a child to take another’s opinion with a pinch of salt. Always ask ‘what’s in it for the other person’. Magnus runs an investment firm and therefore any investment advice from him should be taken with caution. He is good at what he does, but there are many other opinions (some contrary to MH) which should also be taken into account. He speaks about the media and then uses this media platform to share his views. I also wonder about the relationship between moneyweb and brenthurst wealth.

There are bigger global things to worry about. The ageing population, the looming global pension fund crisis, the global low growth environment (Japanification), terrorism etc which in my opinion are very serious and permanent issues. The current political risk in South Africa could be permanent, but it could also be temporary. Things change VERY quickly and if you’re brave enough to take a bet on a volatile currency such as ours, you better be prepared for the worse outcome as well.

You said it man.

I also bought discovery at R90 and sold it at R120. D I qualify as an expert opinion on investments for moneyweb?

Our volatile/depreciating currency is simply a reflection of the volatile politics and poor goverment of SA. Politics in SA will only get worse in the long run, resulting in even less growth, even more unemployment, desperate youth, unrest and crime, etc, etc.

Even paying MH his commission, your investments overseas will outperform any local investment in the medium to long term. Leave all your eggs in the SA basket (or should I say basket case?) and the end game is one where you will be a Rand prisoner.

Agreed FT. By diversification I mean ‘proper diversification’. I have money offshore but I’m definitely not moving everything into dollar or sterling.

What I’m trying to say is that there is a lot of negative press (for a good reason), but we’ve seen worse before. People who make hasty decisions and invest on emotion are the people who struggle over the long term. This has been proven over many years.

Also, the after-commission global returns that you speak of, are they based on a very volatile currency’s depreciation, or actual fundamental asset class growth? Compare the returns in ZAR and Dollar. The grass isn’t as green on the other side, and also not as yellow this side.

Go and have look at other opinions regarding the PPP and funamental value of the rand, and also proper business leaders’ opinions about SA’s future.

It’s great for MH to say ‘I took my money out at R6.80’. What frustrates me is that offshore investing shouldn’t be the hot topic at R16 – R19/$, it should’ve been in 2011. But there is emotion and bad senitment out there – a great time to make commission.

‘we’ve seen much worse in our country,…’

Pray do tell when.

We have never seen it so bad in living memory unless you were alive during the Anglo Boer War. Our country has NEVER been controlled by such an unimaginably stupid bunch of peeple. SA is in unchartered water and no rational thinking person would trust the bunch of peeple running our country further than they could throw them.

Just a correction Magnus. A presidential jet at R4b is not an “Nkandla in the sky.” It is equivalent to 16,000 Nkandlas.

interesting chat on this thread. I would like to believe that SA will U-turn as it did in 2002 and many times previous.

what worries me this time though is that the issues seem to me to be far deeper than merely a Rand decline ie …. its not a short term rush to safe havens as it was in the EM crisis of 1998 or 2002.

@Ruans, @Mashimane, @MoneyChief … I want to believe you. please help me see how any change in government will find the cash to

(i) create jobs – our manufacturing is dead and outpriced by the east and our mining is closing and what is left is being mechanised
(ii) fix our infrastructure (ie water shortages in JHB, the green water in Witbank, the radical sewerage levels in the Vaal)
(iii) fix or rescue our SoE’s
(iv) do something, anything, for the 3 lost generations who have had little or no education (10-20yr, 20yr-30yr, 30-40yr)

like I said, I want to believe but we seem to have turned the corner

Howzit Bertie,

I wish I knew the answers and won’t make myself out to be an economic expert, but if countries could stand up after a depression, global financial crisis, apartheid-like sanctions, world wars, the iron curtain etc, then surely we have hope in SA if the right leaders come to the fore.

I think that the difference between the world coming out of depression in the 20’s and South Africa recovering now, is, as you say, in the quality of the leaders.

While the USA had leaders of integrity and vision- we have Jacob Zuma. Before him we had Mbeki. I think that while the ANC is in power, this country is going to deteriorate further and further.

What you say is true Sensei. Another angle is that Affirmative Action and BEE forced many of our children to seek work overseas after school / university. While this was upsetting for many families I am starting see the positive benefits. There is a steady flow of returning children coming home having acquired skill sets they could never have learned back here making them much more employable, with a large amount of GBP banked away in the UK but bringing sufficient back to pay cash for R3 000 000 property and a new Land Rover and able to start off married life with a bang.

The credit downgrade started the moment Mandela stepped down as President.

My Views:

What needs to be done?

Business confidence will never improve in South Africa again as this country lost its moral compass …latest Constitutional Court rulings refers
Trade union militancy will only increase…the country started burning already …
Foreign Investment is no more than ‘’stork money’’ that follows quick yield around the world. The smart money like the best brains in business always leaves first….Money flowed in under Nelson Mandela due to the countries then martyr status. The new ANC destroyed all the investment potential and confidence in South Africa…..
My view is that anybody that still believes the ANC will let go of SOE’s must find another day-job…
With all due respect to Moneyweb and Brenthurst Health, if the above is what you want to discuss/cover at your series of seminars, please don’t send me an invitation as it’s my view that you might have a 100 % better chance of getting an infection from a meat eating bacteria, in your noses, than succeeding with the above action plan!

Some of you a bit harsh on poor Maggie?

I remember 2011 him jumping up and down, show after show, to go global when rand was at 7 to usd. He deserves some credit.

Yes he has a certain message, like most experts, but by simply saying he dooms everything for the sake of his own business is not really fair. We can’t ignore these facts guys. Yes, also listen to the other side of the story before you decide how to invest. But for me as an investor it is very relevant reading.

“I remember 2011 him jumping up and down, show after show, to go global when rand was at 7 to usd. He deserves some credit.”

If this is the case then I take back what I said and will give him credit. It just seems like everyone has a ‘sale’ on offshore investments at the moment based on the country never going to survive the current situation. I’d rather be positive and believe that we will survive as we’ve done many times before.

NIce of you Ruans to offer some apology.
Cannot be easy for a commentator such as Mags to “put it all out there”, especially in writing, when it remains there for all to see for time immemorial due to the internet.

every ex south african I know does not miss south africa…all they can say is ” ag shame poor souls”.You can’t fix that broken country.

not quite right – all of us remember the days of our youth – when life was easy and everything done for you – AND you were master of all you saw and us liberals believed that the moment the masses were given the vote it would be paradise on earth. well I was wrong in the 60’s and the 70’s about this BUT not in the 80’s!

For g-d’s sake shut up, robert.

I second that… you have verbal diarrhea! Go away!

then stop posting DUMB comments – very easy!

Either way, we are all emmigrating from this point forward: either to another country, or to the current affairs South Africa which is right now uncomfortable for all. Once you have made your choice, it’s time to get on with life. We are an emerging market, will always be an emerging market, and business will never be done to (perceived) first world integrity standards. Stop irritating yourselves by comparing SA to developed countries. The fact that we compete in certain disciplines at the very top in the world, does not make us a developed country. It is a testament to the caliber of the talent in SA. I am amazed daily by the Ubuntu and general South African spirit that exists in 99% of its citizens. The 1% that spoil it for the rest are having their day in the sun, but the sun is setting on them. I am unconvinced that a bad political patch will tarnish this country forever. Look how this country flourished after apartheid was abolished. How soon we forget?

yeah I completely agree with this.

the only thing which stresses me in SA is safety and security and until I can feel safe there with my small kids, the place remains an abyss.

Warren Buffet declared that 90% of the money he leaves to his wife is to be invested in the Vanguard S&P 500 fund. He has also stated that for the past 240 years it has been a terrible mistake to bet against America. I think we should take heed of these statements when making investment decisions. It is interesting to note that there is very little diversification in that 90% of the money is allocated to one asset class and arguably in one geographical area.

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