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Daily Dose

16 January 2018

G morning,  

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On the Wires

Philippine volcano rumbles back to life, thousands evacuated…Two dead in Peru after 7.3 magnitude quake…Plane dangles off cliff after skidding off runway…Iranian tanker sinks engulfed in flames, official says no hope of survivors…UK treasury chief accuses EU of paranoia over Brexit…Guard due in court over Tarlton tractor driver's shooting…Cape Town cops arrest 212 people in weekend swoop…De Lille wants a chance to clear her name…Port St Johns gets R100m boost… EFF shreds H&M stores…Kevin Anderson crashes out of Australian Open…Ngidi's metamorphosis from frail to fit and firing…Paisley hails caddie wife after SA Open win…Rampant Reds end City's unbeaten record…Sanchez missing as Arsenal slip to defeat at Bournemouth.

 

Two Cents Worth

I wrote this on 5 December…

“I know that this might seem like “Johnny come lately” but Donald Trump is mind blowingly amazing! Love him or hate him, he is entertaining and is a dream come true for every dumb person, comedian, cartoonist and dinner party in the world. He is also great as he makes most people look like they have a degree in Dale Carnegie’s- “how to make friends and influence people”. The fact that he is the “leader of the free world” defies logic, is most concerning and a disgrace. Over and out…”

Last week, Trumps comments regarding immigrants and the “S…Hole” countries that they come from, are even more mesmerizingly amazing. Certain US ambassadors were called in to explain these dumb words, but it was great to the African Union stood united in their appeal to the UN. Surely the US (and their voters) cannot allow this to go on?! At the same time, surely the UN cannot allow these continued insults to all nations to continue?! I have read history books that include characters that are similar, in that, they have military power, are bombastic, have zero diplomatic skills, are not guided by faith and have no conscience. These characters have got chapters written in history books, for the negative influences they had on the history of the world. Donald “Dumb” Trump seems to be heading down the same path?

I will say it again…the fact that Donald Trump is the “leader of the free world” defies logic, is most concerning and remains a disgrace.”

 

Currency Crackdown

Thanks to Wayne,

 

The rand has traded firmly within a narrow range for most of last week. It continues to be influenced by the political shenanigans of the NEC and the continual power play between the President of SA and the president of the ANC. This is still to play out and if, by some miracle, it looks like JZ will step down, the rand will break the bottom side of the current range and head into much lower territory. We cannot hope and hold thumbs for that to happen. We need to look at the other indicators.

Internationally, the $ had a bad week and lost ground against most currencies (look the daily moves against the $ and then the others). This, as their economic releases continue to disappoint. The disappointment translates to a less Hawkish (higher) view on interest rates, and the $ index is trading at the lowest level since 2015. EURUSD is over the 1.22 level which seemed highly unlikely a year ago. Good news for the rand.

Equity markets are still going great guns which remains rand supportive, while Gold continues its climb (back of weaker $). Brent is at the $70 per barrel level which is a concern. We do the have the first monetary committee meeting for the year this week and with higher oil (inflation effects) and an upcoming budget, it seems unlikely that the committee will pull a Montecasino move.

Economic figure releases are not an issue today, so it’s down to plain economics (SA still seriously in a hole) and flows. Look at the ranges and go with it, if it breaks. Everyone should be back in the office, so it might get a touch wilder although it is a US holiday today.

 

Did you know?

Donald Trump has stated that his hair is real and he gets his haircuts from his wife Melania

 

Have a glorious week, 

Wayne

 

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