OPPORTUNITY BEGS [Part 3]

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In Part 1 we used the acronym of COVID to good effect. Our COVID stands for:

Concentrate On Victory In Defeat

We said that using a crisis for victory, means that although you are not exempt from it and may even be infected, you use every ounce of your energy for two things:

  • To protect yourself, those closest to you, and those beyond.
  • To learn from the crisis and then begin to plan for life after the crisis.

Point is, you don’t plan for the crisis but through it. It is a juncture, a point in time, an event that can precipitate change if you isolate but don’t hibernate if you lift your head and don’t succumb to defeat.

Your immediate three actions are:

Hygiene. Isolation. Test [if you get a dry cough and sense a fever].

In Part 2 we considered some gifts that are human and precious:

Choice. Family. Panic vs Patience. Levelling. Connectivity.

We concluded with these thoughts:

  • Coronavirus begs a response from us. It is business unusual. We now have time to change where change is needed.
  • Character is refined in a crucible.
  • Choose Family. Be Patient. Allow yourself to be levelled. Stay connected.

I have had positive feedback from some readers. But in receiving that, I cannot describe how I didn’t want it in the sense that right now, I’d prefer to be writing about a rebounding market and interest rate drops and recovering businesses as staff return to them. What do I say in Part 3 to businessmen and women who are facing a financial crisis? How do I explain away Moody’s Ba1 Negative Watch rating and that the Nedbank share price is R67? Right now, to me the only good news on the horizon is a R2 reduction in the fuel price.

Most of my readers I imagine are businessmen and women. Anyone who has had the courage to step out from corporate salaries and face the prospect of commission-based sales as an originator, an estate agent, an estate agency or a conveyancer is a businessperson, in fact, an entrepreneur deluxe.

Let me tread this water as humbly and hopefully as I can:

    1. Saleable, Scalable, Sustainable: Being clever in hindsight is not my style. But allow me this one look in the review mirror. No matter how small or big you are, these three things are a guiding light for business.
      • Saleable implies that you are building a business that someone else will buy whenever you begin to prepare to sell it. Of course, this does not apply to sole traders other than you have a database of relationships built over years and you “sell” that in different ways. Financial brokers value their forward annuities from clients. Doctors sell a practice with known incomes over a previous period which it would be up to the buyer to retain. Principals would do the same.Large businesses would have developed structures of mangers to make the entity saleable without the original founders involved, and then the past income multiples would kick in. The only point I make is that this process takes time and strategy to work out for your business but don’t lose sight of the value you have built up over time through hard work.
      • Scaleable: Point here is that it would be preferable if your business was scaleable. Investors buy income streams, but they also often buy expansion opportunities. How many estate agency offices do you think Seeff started with? One. How many today? “Over 200” says Google with 1200 agents. Not bad for a company founded in 1964. Whether scaleable by opening branches, licensees, franchises, etc, it really doesn’t matter. Think about the scalability of your business and follow the strategy with intention.
      • Sustainable: This is the hardest one for me right now. Let me handle it away from our property focus. Edcon [Edgars opened its doors in Joubert Street, Johannesburg in 1929 and now incorporates JET stores], is in trouble again. I got to meet its CEO, Grant Patterson, who is ex-Spar and -Massmart, back in the days I managed Nedbank’s Card Acquiring division. He’s been overseeing the turnaround at Edcon. My heart broke for him on Thursday when he wept as he told all his Suppliers that Edcon does not have the money to pay them. Briefly, Edcon has R400m and that is needed to pay staff who cannot work during lockdown and by end of this period, Edcon will be R800m shy of budgeted turnover. Without a fresh capital injection by shareholders, Edgars and JET will finally be no more. He has been praised by some suppliers for having the courage to face them with the news instead of, as some have done, sending a cold “we-have-a-problem” letter to suppliers. While off the focus, the SOE’s have proven a disgrace for the government. Imagine the R100’s of billions used to save them being in the bank right now for COVID measures. R16bn is still set aside for SAA. For what? Com’on, shut it down. Richard Branson’s Virgin Airlines is asking for a rescue package and the USA’s airline industry is taking $60bn in rescue from the $2trillion package signed off yesterday. How do you think SAA is going to fly again? Right now surely the only sensible thing left, seems to be to salvage those businesses with a fighting chance and close the rest, thus giving the staff decent retrenchment packages. Heaven help us!These real-life dramas dramatically speak to Sustainability. Essentially, being sustainable is having money in the bank when times get tough and enough of it to survive commercial storms. Today the question is how much it would take to survive coronavirus for each of us in business?
    2. Caring for the assets: Many owners pay lip-service to their most important asset. Intentions dictate People but behaviour may demonstrate more inanimate things. In financial services, very little beyond brand and technology has much value. We are people-orientated and people-intense businesses; you just have to walk through a conveyancer’s office to realise that. I put to you that if you care for the Hero, the business, as I described in Part 2, then you will naturally care for the employees.When all is said and done and the virus is dead, your people will return to work. Some may have expected compensation, but I’m positive that loyalty will increase with having been cared for to the best of the owners’ ability. I’m not a cynic who says if you want loyalty, buy a dog; I have experienced gratitude even in instances where tough calls were made. People appreciate people – care as much as you can for your employees. After all, they are probably the reason why you got where you did in the first place.
    3. Protect the Hero: The business gives returns to the investors and employees to the staff. In that sense, if your actions sustain the business through the tough times, it may not come through unscathed, but it may come through. In doing so, however, downscaled, it will continue to offer returns and employment for many years to come. Here is the rub: What is needed to sustain your people and keep even a remnant of the business alive? Monitoring what you have in the bank, allowing for a high percentage of non- or short-payment from debtors who have their own predicaments, providing for delays in conveyancing and registration, and then looking at your costs, is your best estimate of how much you need to survive.This principle is no different for individuals and I have no doubt thousands of people are planning to delay their debt repayments in order to fund themselves or their businesses. No wonder Nedbank’s share price has plunged to R67 [by the way, it was R54 after the crisis of the early-2000’s]. Your finances will be tested to the hilt and you may need to make terrible calls way before you hit rock-bottom. And remember, you need to act sooner rather than later to ensure you’re not too late. At a national level, as an example, I can’t help but feel it’s too late for SAA. What I have written before when discussing these matters is that the business that survives continues to employ for many years. The originators and so many other stakeholders in the property industry bear testimony to this truth. Some I can think of right now have flourished even more in the last decade than before the Sub-Prime crisis.
    4. Protect your brand: Your brand, both personal and business, is the beacon by which others know you personally and commercially. Whatever you do, protect your brand. Openness, optimism, pre-emptive actions, foresight, understanding, consideration, humility and courtesy, to name but a few attributes, are the characteristics that matter most.You and your business can have those attributes. What also happens in a crisis is that people lose sight of these human and business qualities. Psychologists doing Management interventions test you often at your limits; it’s there that fuses shorten, negative instincts exhibit and the real “me” come to the fore. Especially be honest with your people. Many of them know your business as well as you do. Tell them the truth as best as you understand it, they will value your transparency.
    5. Make contingencies: There is an old term: Hope for the best, prepare for the worst. It’s not helpful at the extremes as very often the real scenario occurs between the two. The only way I know to deal with this is by using probabilities. Using base case as normal business, you need to assign probabilities to income, debtor repayment and creditors’ willingness to assist. These probabilities would then give you a worse case and then a worst case. At these cases, the amount you need to survive the storm becomes calculable.Some things from experience:–
      • This exercise almost seems puerile to discuss. It is really obvious. However, the reason why I mention it is because we may become paralysed by anxiety and spend more time worrying than acting. The exercise helps you focus on what needs to be done and when. Action casts out fear.
      • Don’t delay. If you need facilities, arrange them. If you need debt relaxation, ask; there is nothing lenders hate more that borrowers who duck and dive their payments – talk, restructure, arrange to pay a minimal amount. And if you need to shed costs, shed them before it is too late.
      • A planned reduction in overheads proportionate to turnover may become a hallmark of your leadership in a crisis. Watching the originators who survived 2008-2010 and then diversified their businesses into auxiliary financial services, they have done very well and are now better poised with more annuity income to ride this storm.
    6. Working remotely: We have talked about this phenomenon since the invention of the computer. The internet raised the opportunity. It was interesting to hear the CEO of Verizon talking about his 135000 global workforces working remotely as far as possible. What he also shared was the upgrades to their systems to enable corporate-orientated bandwidths to be upscaled for domestic traffic; a project to which they allocated $500m. How do you now manage? – no coffee meetings, no MBWA, no social occasions, no physical meetings. I’ve never done this, but I am now chairing boards virtually at least until end-April and finding it tough. I tend to watch people and facilitate meetings accordingly, now, especially with some line-loss, I find myself interrupting more frequently. Here are some of my thoughts:
      • Monitor technology links real-time.
      • I would have a virtual meeting first thing every morning to uncover needs for each role.
      • I would contact individual staffers to ensure their anxieties are aired. This would not be forced but a natural conversation between “friends”.
      • I would check myself daily for stress. As intimated above, unnatural circumstances affect behaviour. “You can’t preach the measles if you’ve got the mumps”, said one of my pastors years ago. Even though your time is face-only time, your eyes and voice will resonate unease. Calm down as a daily routine.
      • Manage your expectations. Nothing changes in delivery required to satisfy your clients. They may make some allowances, but don’t assume they will; retain standards of performance and especially, business risks management.
      • For the rest, be yourself. “This too will pass” must be our mantra as we deal some of the shocking revelations from every information source.

In conclusion, this has been very difficult to write. People matter and I’m writing to and about people with as much empathy as I can muster. But we must prevail and prevail we will.

Homeloan Junction is in this with you. We are not immune in the least and have uncertainty at every turn. However, we salute those of you working from home. Thank you for your support. We assure you of ours. Please keep in touch and let us know how things are going.

We trust God’s protection on you and your families.

Yours in Property.

OPPORTUNITY BEGS [Part 2]

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In Part 1 we used the acronym of COVID to good effect. Our COVID stands for: Concentrate On Victory In Defeat

We said that using a crisis for victory, means that although you are not exempt from it  and may even be infected, you use every ounce of your energy for two things:

  • To protect yourself, those closest to you, and those beyond.
  • To learn from the crisis and then begin to plan for life after the crisis.

Point is, you don’t plan for the crisis but through it. It is a juncture, a point in time, an event that can precipitate change if you isolate but don’t hibernate, if you lift your head and don’t succumb to defeat.

Your immediate three actions are:

Hygiene. Isolation. Test [if you get a dry cough and sense a fever].

One thing that you now have on your hands in isolation is time. Planning in the situation and through it, becomes eminently possible. But before I consider that, what can we take from this that is human and precious:

1. Choice: Up to the time of isolation we had free choice. I’m surprised that some wise guy has not taken the government to ConCourt because their “right to choose” has been violated. A National Disaster status allows our choice to be curtailed. What a privilege Choice is and, like so many things, when it’s removed legally, we realise how much we miss it. It is a right, but it is also a precious right.

I have a cricket field close to the house where we walk the dogs every afternoon because the spaniel paws us to go from 2pm onwards. Now I have to explain to them that their walk is banished – frankly, I’d rather do that than have your problem isolating schoolkids ☺

2. Family: Talking about children, how important is your family? Very important. And now, for the first time even including your last holiday, you are locked in. Dads, you will have to be inventive in your play. TV games will only get you so far but then you’ll need to do something else. Let me suggest: Pay Attention, Talk About Important Things and Listen.

I am no role model, but I understand that you can spend years grafting your backside off and seldom have or take the time to look someone you love in the eyes and Listen while they Talk. It needn’t be styled as a therapy session, it could be helping with a braai, or playing on the grass. Time exists now to love your family and restore relationships that may have frayed.

3. Panic vs Patience: I was speaking to a friend yesterday about banking and investment portfolios. Bad enough to be utilising retirement portfolios to supplement your income, but how does it feel to have your business at risk? I was CEO in 2008 when we shut down our mortgage origination business, person by person; for the associates across the country, the property market slowly shut them down. Paramount at the time for me was the notion that the business is the Hero. If you keep that alive, you keep hope and employment alive. Whilst turnover decreased from R888m in July 2007 to R92m in January 2009, we hung in with a tiny team.

It took a mammoth effort to keep the company alive, but we did it and today it, and two of the largest players have continued – even though, never to the same levels. In that calamity, Panic was never an option even though it was your natural response; it truly was a frightening time. Og Mandino, a well-respected American author, in his best-seller, The Greatest Salesman in the World, had a chapter titled: This too will Pass. I have never forgotten those words and their meaning. You see, when you begin to realise this too will pass, you find Patience. Patience to sit it out, patience with your kids, patience, almost positive acceptance, at the state of your investment portfolio, patience to cope with what you should be doing and who you should be seeing but, alas, cannot.

Let me put it this way: May Panic elude you and Patience find you.

4. Levelling: Rich, poor, black, white succumb to this virus. It is a great leveller. It was found amongst the Chinese in Wuhan, it came to South Africa as a result of a returning traveller and now we have four cases in the Overberg. Egos should be put aside; “they” and “them” are “you” and “I” as we face this unprecedented lockdown. We’re all equal. But if you can, spare a thought for those with children in a nearby shack who have to “slum it” literally, while we enjoy the relative luxury of our homes. We should be on-our-knees grateful for our circumstances and our health. Realise as you contemplate the “trial” of isolation how brief Life really is. And, how fragile. A 125nanometer [that’s one billionth of a meter] ugly little virus that looks like a sea mine, has flattened the globe. I don’t have a word beyond “fragile” to describe our human state right now. We have all been levelled.

5. Connectivity: We are also all connected. We have a Soup Kitchen every Monday at church where we serve the homeless. That event has grown from a low of about 18 people to 41 the previous week and over 50 last time. Those people are connecting because they’re hungry and soon even the restaurants’ bins will be empty. We certainly are all connected, even from the highest to the lowest of our society.

Even in isolation, with the help of modern-day media, we can remain in touch, remain connected. Make a list of those you love and those you call friends and then phone them periodically. Try not to share your problems as they probably have enough of their own already. What they need is care and encouragement. They need to hear that this too will pass and may even appreciate a lekker joke. Tell it and whatever “heavies” you share as friends, always try to finish off with a word of hope, a story of “Victory in Defeat”, remembering it’s often only the last few paragraphs of a conversation that you actually remember. Always invite them to call you if they need to chat.

I guess I could go on and on, but just a last point. Selfishness and materialism could be at the heart of your and my need to change. We may live “isolated” lives in principle – me, mine and ours – permeates so much of who we are and what we do. I remember a FB comment after two weeks of protesting in Hermanus that said something like this: “Com’on now, stop it. My domestic needs to get back to work.” I remember how I felt, an initial smile and then an anger at such insensitivity.

The lady domestic was cordoned into her own township and not allowed to leave the perimeter without paying an exit fee and if she did not return on time with what she said she would buy, they threatened to burn her house down [they only needed to do a few to get their awful message across]. What a disgraceful way to view the plight of those people, telling them to stop so as to “ease my inconvenience” at having to do housework! Shame on us! We need to open the curtains on our selfishness and let the light change our attitude. Lay down our materialism; everything is getting scratched, chipped and older anyway.

I’ve taken a moral high ground in this blog. I have done it for effect. I am guilty as charged and probably as guilty as anyone when it comes to poor attitudes at times. However, coronavirus begs a response from us. It is business unusual. We now have time to change where change is needed.

Character is refined in a crucible.

Choose Family. Be Patient. Allow yourself to be levelled. Stay connected. You could be amazed at the change that will occur in you, around you and because of you.

In Part 3, I’ll talk to some commercial implications of COVID, in my humble opinion.

Yours in Property

OPPORTUNITY BEGS [Part 1]

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This title is the best of three so far.

I’m trying not to use the acronym, COVID-19 for the Coronavirus disease or its virus’s code: SARS-CoV-2. The latter is ominous and is an abbreviation for Severe Acute Respiratory Syndrome which when coupled with 3 times the degree of contagion, is the essence of this problem globally. Probably my first and last piece of humour: I’m so glad Eskom seems to not have caught the virus. Please stay indoors Eskom, preferably close to the boilers.

For the rest, my thoughts, hopefully, to lift our eyes and hearts….

CRISIS in Chinese contains two symbols: Danger and Opportunity. I’m sure you’ve often heard that even from me. However, I learned this morning that though widely used, it is not the correct interpretation of the Chinese term. Rather, it means: Danger at a point of juncture. To take the meaning further, Juncture means: A particular point in events or time OR, A place where things join.

Machiavelli first said: Never waste the opportunity offered by a good crisis and Winston Churchill popularized Machiavelli by saying: Never let a good crisis go to waste.

With those thoughts on the table, what does it mean to us? Firstly, we are in a crisis. Every now and again I allow myself the luxury of wondering why Flu kills 600000 people a year even with a vaccine and we hardly bat an eyelid. Cancer, road accidents, diabetes, obesity and heart attacks follow suit. But drawing myself back to the evidence, Covid is three times more contagious and would kill more acutely if allowed to get out of hand. In short, if 70% of 7billion people were infected, then by Christmas, 49million people would die if the health services held up. Concentrated in older or less-immune populations [read: Italy and South Africa], that 49m would be unevenly distributed across the globe and wipe out the aged and weak, but much more like a mudslide than a fast-flowing river.

In other words, a mudslide takes everything with it whilst a river may be escaped by those able to flee. At tiny proportions of these sums, the health systems would collapse by end-April and remain that way as the impossible task would exhaust every resource in a country’s medical arsenal. Another issue is that you have it for up to 2 weeks before you know it so it’s not what you have initially, it’s what you give that is the frightening thing. So, to sum it up, me and those I “touch” would not escape the rampage of the virus.

Ironically, as there is no real medicine to counteract the virus at this stage, the unsophisticated cure to this crisis is to lock-down in self-isolation and/or respect physical distancing. To do any less, unless it is critical to do, is selfishness of the highest order. Already governments are calling in unprecedented measures to make people isolate as far as humanly possible. Watching Boris Johnson last night after the British people took to the streets and parks in a weekend of rare Spring sunshine, he was blunt in what he will do next if they don’t behave and isolate. His argument is that Italy has excellent medical care, but they have fallen over in exhaustion losing the battle now at up to 800 deaths per day. The NHS will do the same, he insisted.

So, what about us? We are precarious with a dual population of well-off and poor. Predominantly amongst the poor, we have twin peaks of TB and AIDS. Then finally, we have people come into our homes, shops and factories every day who arrived there in congested taxis, buses or the odd train. We truly have a cauldron of contagion, a crisis, and we cannot think it away. No wonder the President has made radical decisions so quickly even though we cannot afford them. By the way, he has been brilliant in my opinion and for once, all his personal imperatives and skills at consultation, have kicked in for all of us to see. Political parties [except the Reverend Kenneth Meshoe, ACDP, who is quarantined], Labour, Business, and Social Groupings all combining to accept and agree on packages to make our isolation to 16 April, a possibility. Well done, Mr President! We don’t like what you’re doing but we really value that you’re doing it to try to “flatten the curve”. And what an amazing gesture of support for the nation in the R1bn donations each from the Rupert and Oppenheimer families.

Please, my reader friend, listen to him – you are less bullet-proof than you think.

Now that I’ve stated the obvious and re-nauseated those of us exhausted by the news, what was all that about “not wasting a crisis”? I am intrigued by the notion of “juncture” this morning. It is the danger at a point in time or where everything meets, that the word CRISIS speaks to. I like to think of snooker balls that are aimed and strike each other at precise angles – a point in time and juncture. No matter how softly, they clink and bounce apart on an intended path. The energy of the player transmitted through the cue drives the energy that moves the balls. What a different metaphor now than the one I intended when I sat down to write this blog! You see the snooker balls are designed for movement, not to stick together. They are designed for winning ways. When they’re sunk, they score and sometimes, when sunk by mistake they are re-introduced to the game, they literally, get a second chance. No wonder the inimitable Winston Churchill, admonishes us to “never let a good crisis go to waste”.

With this blog in mind I have been trying to come up with an alternate acronym for COVID. I’m sure you have many, but in the light of the above, I propose:

Concentrate
On
Victory
In
Defeat

You see, using a crisis for victory, means that you are not exempt from it and so you enter it with everybody else whether you’re infected or not. But then you use every ounce of your energy for two things:

  • To protect yourself, those closest to you, and those beyond.
  • To learn from the crisis and then begin to plan for life after the crisis.

Like I’ve said about retirement, you don’t plan for retirement, you plan through retirement. You answer the question: When I retire, what will I do beyond that “juncture” to ensure life is meaningful to me and others. To use the metaphor above, you’d just be moving your snooker game to a new table but use the same balls. This crisis has the potential for good change if you isolate and don’t hibernate if you lift your head and don’t succumb to defeat. Trust me, I’m not being patronising or clever. I’m already speaking to people who confess they’re “benoud” [fearful, anxious] and I don’t blame them.

Coronavirus has the potential to cripple lives, finances, dreams and even societies and their governments. I’m watching President Trump like a hawk and last night distinctly felt he’s losing grip of the situation and any hope he has for a second term. Phaffing around with the Defence Bill, wondering if 15 days of shutdown is excessive, bidding against New York State for medical supplies, may be sowing the seeds of his own downfall. On the other hand, Italy, Britain and South Africa seem to have the leadership fortitude to succeed “whatever it takes”.

To finish this Part 1, my immediate actions for your consideration:

 

  • Hygiene: The big no-brainer at this stage of the game. Sanitise, sanitise, sanitise. You cannot wash your hands enough. And then, DON’T TOUCH YOUR FACE! Yes, that includes you Jack – I really battle with this one and sometimes I feel like Nadal before he serves ☺
  • Isolate: Whoever and as much as you can. I’ll say that again, Whoever and as much as you can. It is the big gainer in this disease. It flattens the curve and if you have doubts, China shutdown Hubei Province of 60 million people and Wuhan City in it. Whilst Wuhan remains closed until early April, Hubei is open for traffic. No better sight was seeing cars on their highways this morning as life begins its journey back to normality. Joy to the World; there is hope at the end of the isolation tunnel!
  • Test: If you get a dry cough and sense a fever, test without failure or delay. Plan now how you may isolate in your own environment if you test positive to prevent infecting those nearest to you.

I realise that many of you for valid reason feel you cannot isolate. However, be bold enough to ask yourself the question: What would I do if infected? And then work back from there. In this regard, we have a church of about 700 people with 80% of them over the age of 65, the highest of risk by any metric. It has been a real challenge to cancel all meetings, at this stage probably Easter, and then trying to stay in touch with the congregation many of whom are technically challenged and perhaps not even wealthy enough to be tech-savvy. Dealing with this issue in a short space of time has given me a little insight into the difficulties many readers will face in their business.

Have patience with your leaders at whatever level; they have never been here before.

We’ll continue with Part 2 in 48 hours tops.

Yours in Property.

2020/21 BUDGET

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This a very short blog.

In my humble opinion, the Budget was good. For property, it means:

  1. Less transfer tax with property less than R1m zero-rated.
  2. More money in the pockets of people who may be 1st-time homebuyers. The tax entry threshold has been increased to R83000 and lower-income tax rates have been reduced.
  3. The Treasury has decided to reduce government expenditure as required by any corporate who has grown their staff to the point of unaffordability. In addition, even though recent declines have occurred in numbers of employees, the wage bill has increased by a real rate of 40% in the past 5 years [I think I’m correct about the time, but I’m definitely correct about the increase].
  4. About R260bn is being cut out of government starting this year over 3 years.
  5. Money has again been allocated to Eskom and SAA; about R160bn. Eskom is simply too big and too important to the country to fail.
  6. Fuel is going up but VAT and Private tax is not. Corporate tax may come down.
  7. “Sin” taxes are up.

Give that man a Bells! Oops, it’s about 30c more expensive ☺

So, if the banks continue to lend and, as we expect, the rates may continue to go down, property will be in the pink.

Now for the bad news…….

  1. Government has blown its budgets for years now.
  2. If Tito fails and the EFF march on Eskom today and the “declaration of war” by Cosatu succeeds to shy away from the resolve of the government and the President, our Debt: GDP ratio, which is already in eye-blinding spheres, will disappear into the stratosphere. There, we will ask the IMF for a bailout or not, but whatever, it will be ugly.
  3. Moodys will probably downgrade us and the ultimate question: Is Junk priced in? will be answered.
  4. The money paid into SAA will be wasteful expenditure ab initio. That into Eskom may just do what it has to and help keep the lights on.

It’s a brave man who calls what will happen but indulge me and let me give it a try…..

  1. I think the Finance Minister will be able to convince the Unions that less is more, and that destroying government is counter-productive for everybody.
  2. SAA business rescue will succeed with a very trimmed down airline, or a sale with half the jobs protected and, whichever, the management will be sanguine and professional going forward.
  3. Eskom will tide our way by spluttering through on three cylinders. Private power will increase rapidly and more and more, large public and private institutions will generate their own power. This will place an already battling Eskom under enormous pressure but never again will we be in this one-man-one-power position. None of the major nations I have visited have all their electricity coming from one supplier. In America, with hurricanes and snow tempests, they could not stomach them if they did not have widespread power producers; just makes sense.
  4. Government will come good with repatriations of money stolen by corrupt means, it will prevent wasteful expenditure and SCOPA will prosecute offenders, it will take the pill of salary reductions for staff continuation and it will muddle its way through ANC factions and opposition’s disgusting behaviour. Maybe I’ve just been reading too much Mcebisi Jonas, After Dawn, Hope after State Capture, but I was buoyed by the grip he has on matters economic and the Foreword by Cyril Ramaphosa. They know exactly what to do and that if they do not, the lights will not be the only thing that goes out.
  5. The President’s meeting with business and his urgency for private investment must bear fruit. Off this low base, every R1bn will count towards growth.
  6. As I write the stock markets have plunged and the Rand has followed suit. The only good news [for the wrong reason, of course] is the Fuel price. The downgrade may affect already-scared sentiment, but right now Corona has terrified the world. I thought the 58% theoretical infection of the global population was unlikely. But it’s creepy at the moment. Who knows but that Corona will dissipate and a downgrade will be lost in the noise of it and then we’ll rise up again? Truth is I have no idea but I sure do hope so. In the meantime let your nervous twitch cause you to wash your hands frequently and touch anything but your face.
  7. I think the banks will continue to lend, but the rate will need to remain so as to protect the Rand somewhat. Bond investors will continue to call for a world-beating rate differential but that certainly is already priced in. It seems the Citi World Bond Index investment may only be about $8bn so that will not affect us too much.

Motherhood and apple pie, my thinking may be. But if you panic, panic first; it’s too late to panic now. So, I would not say, Eat, Drink and be Merry, but certainly let’s understand when things are not under our control and relax in the knowledge, we have done our best.

If the virus begins to be contained and the budget has a shot at implementation, property – our main focus – will benefit and things will improve again. We will hope for that normalcy back in our lives again. In the meantime, spare a thought for China, its neighbours and Italy who all seem to be in the eye of the storm.

Yours in Property.