Articles tagged as "economy"
Seeking a bridge for South Africa’s troubled waters
As South Africans breathe a sigh of relief that load shedding has tailed off, water risks have come to the fore. Multiple provinces are grappling with...
Rate-cutting cycle kicks off
During the last quarter, US equity indices reached new all-time highs as the US Federal Reserve (the Fed) commenced its rate-cutting cycle with a cut of 50...
How we balance the upside-downside risk in South African equities
We often write about large individual equity positions in our portfolios, but this quarter, Duncan Artus focuses on the opportunities and risks in “SA Inc” –...
Eskom: Are brighter days ahead?
What does 2024 have in store for loadshedding? Raine Adams investigates whether there is any light at the end of the dark tunnel.
The prospects for global growth
The post-pandemic bounce back of the global economy is losing momentum, and many fear that developed economies may slip into recession.
Shedding dark on the issue of South Africa’s economic growth
South African companies are reallocating billions of rands towards the extraordinary costs associated with loadshedding. Government’s prospects for debt...
Regime change and the rise of the stockpicker
Alec Cutler chats to Bloomberg’s Merryn Somerset Webb about the impact of central bank and government intervention, the future of inflation and why being a...
The threat of greylisting
The Financial Action Task Force (FATF) was established in 1989 to coordinate an international effort to combat money laundering. As South Africa’s economy is...
Was 2022 a secular turning point and if so, what does it mean for the years ahead?
In his first investment update of 2023, Duncan Artus discusses the current investment context and how it differs from the past, shares a review of 2022 and...
Economic update: A post-pandemic new normal
2022 saw a massive appreciation of the US dollar against all other currencies and the highest inflation since the early 1980s. These trends, which so dominat...
The price of money, the shortage of energy, and the monster of inflation
Thalia Petousis discusses its impact on financial markets, global trade financing and the energy sector, as well as how central banks are now waging a war...
Whither inflation?
In the past 12 months , global inflation has surged. Sandy McGregor discusses the increasingly turbulent response of the financial markets.
On the commodity boom and other South African fables (and foibles)
Just as the economic destruction from the COVID-19 pandemic rose to crisis levels, strong commodity export prices swept in to alleviate South Africa’s fiscal...
Podcast: Can optimism rise from the inflationary ashes?
In conversation with portfolio manager, Thalia Petousis, Sandy McGregor reflects on the very real geopolitical and economic challenges currently affecting th...
Local investment update: Always pay the right price
Jacques Plaut and Duncan Artus discuss the positioning of our equity and multi-asset funds given the pre-existing trends exacerbated by the war in Ukraine....
The SARB hikes rates as food inflation threatens to erode the income of the working class
Raising rates by 50-basis points to take the SA repo rate to 4.75%, the South African Reserve Bank (SARB) delivered what may have been a ‘credibility move’....
2022 Budget speech update
Finance Minister Enoch Godongwana delivered his maiden Budget speech on Wednesday, 23 February. He noted that although the easing of COVID-19-related...
A responsible Budget signalling optimism
The high cost of living, fuelled by rising inflation, significant fuel price increases and a series of interest rate hikes (which are likely set to continue)...
‘Hopeful Budget’ may strike right notes, but tax clarity and economic reforms are needed
This year’s Budget speech, set to be delivered on 23 February by Finance Minister Enoch Godongwana, is likely to strike an optimistic chord thanks to a numbe...
Preparing for more uncertainty and volatility
A look back over the last two years reveals how difficult forecasting is. Even with perfect foresight of the pandemic context, one would not have been able t...
The transition into the post-pandemic world
It is remarkable the extent to which the future is hidden from us. We all conduct our lives largely in terms of our experiences in the recent past, assuming...
The trouble with municipalities
The extensive infrastructure needs of South African municipalities provide an opportunity for long-term bond investors – such as retirement funds – to help...
Global economic recovery slower and more complex than expected
The global recovery from the severe economic contraction in the first half of 2020, which followed the initial outbreak of the pandemic, has proved to be bot...
It’s the price you pay that matters
As investors we shouldn’t pretend we operate in a vacuum that is nicely insulated from the prevailing macroeconomic and political trends. However, it is...
Economic recovery accompanied by a surge in inflation
With increasing vaccinations economic activity is returning to pre-pandemic levels and, while there may be further waves of infection, governments are learni...
Key questions that advisers and clients are asking
Uncertainty is a fact of life, and ever present in investing. There are times, however, when uncertainty seems to dominate sentiment and news flow – and...
Market update: Weighing up opportunity and risk in the face of volatility
While the local market has been strong, South African assets still look cheap overall compared to many of their global counterparts. There is opportunity in...
Inflation returns
Prices are on the up in the wake of the COVID-19 pandemic. The question is, will deflationary conditions resume as global economic conditions normalise or is...
Global recovery underway
The world is recovering from the pandemic and 2021 should see strong global economic growth. The epicentre of the recovery is now the United States, where th...
2021 Budget speech update
Finance Minister Tito Mboweni delivered the Budget speech on Wednesday, 24 February. Against the backdrop of the COVID-19 pandemic, the Budget was more...
2021 Budget signals hope for SA taxpayers
Minimal tax measures aim to bring relief to taxpayers and bolster economy.
The state of the economy
In a recent Q&A-style webinar hosted by Allan Gray’s Vuyo Nogantshi, Allan Gray’s Sandy McGregor and the Reserve Bank’s Rashad Cassim and David Fowkes examin...
Investment update: Taking advantage of disparities in the market
One of the key preconditions for successful active management is the level of disparity in the markets. Duncan Artus discusses this in our first video and...
The impact of COVID-19's second wave
The second wave of the COVID-19 pandemic has interrupted the global recovery following the severe economic contraction experienced during the second quarter ...
Orbis: The power of perspective
It is easy to get caught up in the noise of short-term events like politics. What we have learned over the past 30 years is that a long-term view often revea...
Are you sitting on savings you could be investing?
The COVID-19 pandemic has affected people's finances in very different ways. While it has highlighted the need for emergency savings as a buffer against toug...
The dangers of printing money
Modern Monetary Theory, or MMT as it is often called, is a new term for an old idea. Its proponents argue that a state which issues fiat money does not have ...
Do fundamentals still matter?
There is an increasingly wide disconnect between the economic reality on the ground and the valuations reflected in some asset classes globally, begging the...
How is the market up?
After the worst five-week crash ever, global stock markets have recovered all of their losses in just five months, with the MSCI World Index setting a new...
Will prescribed assets be used as a policy tool?
Reports that the government plans to compel pension funds to invest in state assets and projects have understandably caused alarm among investors, spurring...
Equity Fund update: In pursuit of potential
The most important determinant of investment success is the price you pay for an asset, and valuations for many quality companies are the cheapest they have...
Orbis: Our job is to be uncomfortable
Our job at Allan Gray and Orbis is to be uncomfortable and to sweat our clients’ capital. Ultimately what we focus on is the risk of capital loss - and that...
COVID-19 continues to rock the global economy
It seems that, with a few exceptions, such as the southern United States, in the Northern Hemisphere the COVID-19 pandemic is well past its peak. Lockdowns a...
COVID-19: Portfolio, economic and investment update
During February and March, we were active in both the local equity and fixed income markets. This activity reduced during April and May, as we believed the...
Do bonds offer opportunity in a post COVID-19 world?
As investors we must think about what the world will look like when the pandemic has passed, and what asset classes offer opportunity. Presenting via Zoom...
Q&A: Understanding the economic context in which we must invest
As investors, we must understand the economic consequences of COVID-19 and the impact on different asset classes. Grant Pitt, joint head of Institutional...
The monetary and fiscal response to the COVID-19 crisis
The Coronavirus pandemic has caused a massive disruption of global economic activity without peacetime precedent. In a presentation via Zoom webinar, Sandy...
Q&A with Allan Gray and Orbis: Investing beyond COVID-19
While financial market volatility as a result of COVID-19 is expected to continue over the short term, the investment teams at Allan Gray and Orbis are focus...
Investing during lockdown and beyond
Sometimes in investing, the best thing to do is nothing. In a presentation to advisers and clients via Zoom webinar, Duncan Artus examined the levels and...
Perspectives and portfolio positioning amid COVID-19
The world as we know it has changed dramatically over the last two months, with the COVID-19 pandemic and lockdown strategies causing extreme volatility on t...
Opinion: Counting the economic cost of South Africa’s lockdown
As South Africans, we want our country to prosper and the quality of life for all those living within our borders to improve. Millions live in total poverty...
The world after the COVID-19 pandemic
We are witnessing a global economic collapse without precedent in modern times. As investors we must think about what the world will look like when the...
Positioning our portfolios for growth beyond COVID-19
The speed at which the financial market swings from despair to elation is astounding. The past few months have seen no shortage of mood swings as investors...
The end of the free lunch
There is no such thing as a free lunch. Yet recent times have provided South African savers with something close to this, as risk-free returns from money...
COVID-19: Looking to history to understand potential outcomes
With much of the world in lockdown, one wonders whether it is appropriate to draw on past analogies in thinking about what lies ahead. However, every prior...
COVID-19: Q&A with Allan Gray portfolio managers
With many countries in lockdown, uncertainty prevails. Against this backdrop, many clients are asking for our views on the economic impact, an update on our...
Impact of Moody's downgrade
As a consequence of the decision by Moody’s to lower South Africa’s credit rating from Ba1 to Baa3, all three leading rating agencies now rate South African...
COVID-19: We remain open for you during the lockdown
As we enter into lockdown, Tamryn Lamb, head of retail distribution, reassures investors that we are open during this most unsettling time. She also provides...
COVID-19: Supporting umbrella fund members through the lockdown
As we enter into lockdown, Saleem Sonday, head of group savings and investments, reassures umbrella fund members that the trustees continue to ensure that...
COVID-19: Evaluating market risk versus opportunity
We have managed our portfolios through a range of different crises since 1974. Over the last 20 years, the dotcom collapse in 2001/02, the global financial...
Coronavirus: Taking stock of the state of the markets
The world is changing extremely fast. The global business shutdown is unlike anything seen outside wartime. It is impossible to know the length or depth of t...
How will current market conditions impact our portfolios?
The start of 2020 has been tumultuous as fears about the coronavirus have dominated the news and global markets. The resulting volatility has been compounded...
Making sense of current market conditions
The current market volatility is understandably causing investors much stress. Andrew Lapping examines the impact of coronavirus and the drop of the oil pric...
2020 Budget: Stuck between a rock and a hard place
A revenue shortfall of R50bn was announced in the Medium-Term Budget Policy Statement (MTBPS) in October 2019, and this sets the scene for the 2020 Budget....
How could a ratings downgrade affect investors?
Inundated with reports of failing state-owned enterprises and spiralling government debt, investors are understandably concerned ahead of South Africa’s 2020...
Platinum can move the needle on the economic growth SA so desperately needs
Platinum Group Metals (PGMs) are proving to be market darlings: In the last 12 months platinum prices have soared by 30%, palladium prices have doubled, and...
Should you invest in bonds?
The recent performance of South African bonds – which have outperformed cash and equities over three and five years – has prompted investors to ask whether...
Inflation
Inflation is a phenomenon of great importance to investors. It is subject to intense scrutiny but is not well understood. Sandy McGregor offers his perspecti...
Global growth slows
Over the past year, global economic growth has slowed. International trade volumes have contracted. This slowdown has many causes but has been significantly...
Negativity can often present opportunity
With doom and gloom pervading locally, and the world economy slowing, you may be feeling like the safest place for your money is under your mattress. This is...
An age of anxiety
We are living in an age of anxiety. After decades in which the norm has been optimism, everywhere market participants are extremely nervous about evolving an...
Economic update: A state of stagnation
Global economic conditions continue to deteriorate but so far, no major economy has entered a recession. Business conditions in Europe and Japan are best...
Making sense of the rand
Like other emerging market currencies, the rand has seen periods of prolonged fluctuation since September 2018 but has remained relatively stable over time....
South African investors need to fall out of love with equities
South Africa’s equity market capitalisation equates to more than 200% of the country’s GDP, the highest proportion in the world and a level that is simply no...
Trade wars
In recent months, we have observed increasing uncertainty and concern among our clients about what impact rising international tensions, particularly the tra...
Global business conditions deteriorate
Negative news about the global economy persists. Purchasing manager indices continue to signal a widespread deterioration in business conditions. Even in the...
Valuations matter
Uncertainty abounds at present. Equity returns for the past few years have been underwhelming, political upheaval locally and internationally is causing wave...
Finding value in frontier African markets
Across corporate boardrooms in South Africa, a number of management teams and institutional investors are grappling with a vexing question: Is investing in...
Global slowdown continues to take its toll
The synchronous global slowdown, which commenced in the last quarter of 2018, continues to take its toll. While Europe is not in recession, it has returned t...
How you can influence your investment outcomes
After an undeniably tough 2018, the local market staged a turnaround during the first quarter. But the atmosphere in the country is blowing hot and cold: As...
South Africa's fiscal dilemma
Faced with sky-high debt, a stagnant economy and disappointing tax collections, South Africa is on an unsustainable fiscal path. Difficult choices have to be...
Global growth accelerates but emerging markets under pressure
Following a slower first quarter, the rate of global economic growth accelerated during the Northern Hemisphere summer, with Europe being the only notable...
How to thrive in choppy markets
This year has been characterised by increased volatility and concern about the global risks – from trade disputes to inflation. After a strong start to the...
Increasing policy uncertainty
With few exceptions, notably India, most countries experienced slower economic growth in the first quarter of 2018. Anecdotal evidence suggests that that the...
SA needs to unlock its 'demographic dividend' by getting the private sector to invest
South Africa needs to stop looking to government spending as the catalyst for economic growth and should instead foster a more conducive environment for...
Approaching a tipping point?
After a strong start to the year, global investors have been spooked by a diverse combination of developments, including a slowdown in global economic...
Business confidence improves in South Africa
After 18 months of accelerating growth, the momentum of the expansion of the global economy slowed in the first quarter of 2018. It is noteworthy that an...
Fixing the South African economy
If we can make necessary changes domestically, favourable global business conditions will support a rapid economic turnaround. Now that the ANC conference is...
How are our portfolios positioned to protect and grow our clients' capital?
Regular readers of our commentaries would have noted that we have found an increasing number of attractive opportunities in local equities over the last 18...
What can be done to address SA’s fiscal crisis?
Global economic activity continued to gain momentum in the last quarter of 2017. Global purchasing manager’s indices, which are a good barometer of current a...
The value of bitcoin
The total market value of all bitcoins is US$80bn, which is more than the value of Richemont and triple the value of Anglo American. It is the topic on which...
Facing a fiscal crisis
The synchronised global economic expansion continues to gain momentum. World trade is growing and increasing demand is putting upward pressure on commodity...
Is now the time to invest?
Is it time to put your money under the mattress or is it time to invest? Watch this 7-min clip with Andrew Lapping, our chief investment officer, and Todd...
Global jitters: Avoid safe havens, opportunity in overlooked sectors
The uncertain global political and economic backdrop created by unexpected recent shocks has spooked investors. However fear, particularly when spurred by...
How to be a discerning investor
Negative sentiment and lower expectations for future growth are sending investors scurrying...
If South Africa was a company would you include it in your portfolio?
Sentiment towards South Africa is poor. It is tempting to believe that excessive bad news is priced into South African assets, which should deliver attractiv...
The economics of taxation
An efficient tax system is a necessary feature of a modern state. Taxes have always been a focus of political concern, even when, by modern standards...
SA economy in the doldrums as the rest of the world picks up
Since January, domestic demand in South Africa has been very weak, the clearest evidence of which has been poor retail sales. The consumer is no longer in a...
South Africa at a political crossroad
The political events of the last 10 days, and the resulting ratings downgrade by S&P Global Ratings, have seriously eroded investor confidence in South Afric...
Keep calm and carry on investing
The past 12 months seem to have passed particularly swiftly, maybe because fundamentally very little changed. Interestingly, the light in which investors vie...
The winds of change
While the election of Donald Trump as the next president of the United States was not expected by investors, it does not seem to have been unwelcome: both t...
A changing world
The political shocks of 2016 are a manifestation of rising public discontent about prevailing economic and social conditions. Sandy McGregor provides some...
Money Market Fund update: Rising inflation and low growth continue to cause concern
Global yields have fallen after Brexit became a reality when the UK voted to leave the EU. This uncertainty has decreased the expectation that the US Federal...
Should you invest offshore at R15/US$?
It is exceptionally difficult to decide when is the best time to invest offshore based on news headlines. If you want to get more for what you pay, investing...
Equity Fund update: Volatility presents opportunity
The economic outlook deteriorated during the second quarter, exacerbated by the British referendum. Although the market’s perception of near-term headwinds m...
How to think about the rand when making investment decisions
Over the last few years we have been concerned about the strength of the rand and our portfolios have been positioned for currency weakness. One of our...
Stable Fund update: How to invest in ‘interesting’ times
‘May you live in interesting times' is an English expression which many believe to be a translation of a traditional Chinese curse. The expression seems to...
The economic consequences of political decisions
The vote by the British electorate in support of leaving the European Union (EU) took markets by surprise. The immediate impact was a strengthening of the US...
Gold: A history of its price
Inventories play a significant role in the pricing of commodities: when they are low prices tend to rise, while excessive inventories depress prices. However...
Managing portfolios in times of uncertainty
My inbox is filling up with commentary about the impact of Brexit. Some of the commentary is of debatable long-term value and with news of this nature it tak...
Broaden your horizons with offshore investments
It is natural to feel uneasy about your finances during times of uncertainty. However, one should be wary of making decisions based on short-term events. The...
Uncertainty persists
The increased uncertainty that arose in December of last year has persisted throughout the first quarter of 2016. The current political climate and the threa...
Annual report from the outgoing Chief Investment Officer
Adapted from the Chief Investment Officer’s comments, which will appear in the Allan Gray Unit Trust Annual Report, 2015. These are Ian Liddle’s final Annual...
The triumph of the bureaucrats
There is a widespread lament that economic growth is disappointing. While demographics and structural problems are largely to blame, the increasing cost of...
Interim investor update
Some clients have asked for an update on how well their investments are doing in the current very volatile market. It’s risky to respond until things have...
Manufacturing in meltdown
The manufacturing sector is currently in a woeful state. Simon Raubenheimer discusses why we are where we are. 'The Board of Directors has taken the decision...
Secular stagnation: The new normal?
Economists are engaged in an interesting debate about economic growth and what has been described as 'secular stagnation'. The issue has received widespread...
What's wrong with the South African economy
After growing strongly for 10 years, since 2012 the South African economy has been stagnating, which prompts the question: What has gone wrong and how can th...
Not the time to relax risk appetite
In his 1988 annual letter to shareholders, Warren Buffett wrote: ‘We have no idea how long the excesses will last, nor do we know what will change the...
Message from our Top 10 equity holdings
Investors frequently ask us whether or not our choice of shares reveals a particular theme or ‘story’. Investors are also curious as to how we alter our...
Tobacco economics
Most industries have a single factor that helps investors to understand them better. Unfortunately for investors looking for easy wins, it does not necessari...
The trend is your friend till it bends at the end
For some time we have been concerned about the sustainability and unbalanced nature of consumption growth in South Africa. I don’t believe you can consume,...
An era of high global earnings
Company profits are currently at historic highs, but we do not know with any certainty where they are headed. Although it is entirely possible for global and...
China's Malthusian challenge
Two years since the global financial crisis and commodity prices are back at the record levels of June 2008. This growth has been about five years quicker th...
Deflation
It seems the world may divide into two distinct camps: the mature economies gripped by deflation and stagnation, and the emerging markets, which continue to...
Another view
Governments around the world are engaged in significant fiscal and monetary stimulus. But there is some doubt about whether their efforts will improve the re...
The triumph of the markets
It is the nature of markets to reward success and eliminate what is unsustainable. During the past year we have seen a dramatic manifestation of this process...
