Q. “Hi Timon, I read the weekly article where you expect the JSE ALSI40 to rally.
My question is, if Moody's does eventually decide to downgrade South Africa to junk what would happen and when is the next grading?”
A. The next possible downgrading for South Africa would happen as soon as March, if South Africa fails to come up with a plan with “Credible debt-stabilisation”.
... ››› more
The JSE is down 3.95% for the past three months, 5.13% in the past six and we're only up 8% over the past three years.
With politics the way they are and the performance of the South African economy many investors are asking whether they should bail on SA listed stocks for good.
I'll give you my take on the situation now, let's first have a look at the facts:
SA’s economy is already... ››› more
Last week I wrote about never letting a good crisis go to waste. It's one of the most difficult things for investors to do while you're in the thick of it. You don't want to deploy capital when things look like they are going to get worse, much worse. But that is the precise time to “slowly drip” capital into the market. It's an investors primary focus to look past the noise to see opportunity... ››› more
On Friday 24 November S&P downgraded South Africa's long term local government bonds to junk rating.
The problem according to S&P is that government in recent years have focused merely on the distribution of income, instead of trying to grow our income…
“As a consequence, South Africa’s economy has stagnated and external competitiveness has eroded. We expect that offsetting fiscal m... ››› more
I recently told investors I'm not hot the South African Retail Sector.
In short, the FNB Consumer Confidence index sits at its lowest level since 1985. People just aren't running out there and buying new clothes and appliances at the same pace they had done before.
But there's another casualty to South Africa's junk status news.
The sector I'm about to reveal to you has been thoroughly... ››› more
You've heard the term ‘Buy when there's blood on the streets'.
This is contrarian investing at its hear. But it's been proven true time and again.
In fact, if you'd simply bought a simple ETF like Satrix 40 following the 2008 financial crisis, you'd have made around 70%.
Investing in individual shares following the same crisis would've made you 200%, 300% and in many cases, 600% or m... ››› more
Standard & Poor's and Fitch ratings agencies is expected to give their verdict on the country's rating by the end of this week.
The financial analysts at FSPInvest believe that a downgrade to junk status is inevitable. Even if this doesn't happen this month, it will happen before the end of 2016.
Here's what will happen to the economy and your investment portfolio if the downgrade does happ... ››› more
“The rand could hit R60 to the dollar by 2019: Chris Hart” - Business Tech
“Chris Hart: Nothing can prevent SA's slide to junk” - Fin24
I spoke to Chris about his recession and junk status predictions at the South African Investor member meeting on 24 May 2016. I asked him if he was misquoted in the media. However, he was adamant that he is right about these predictions.
One of the... ››› more
Since the South African reserve bank decided not to increase interest rates again, you have a brief moment of relief to make sure that you get your financial house in order before the next rate hike. Now is the time to be more frugal with your money. It's not the time to make more debt or increase your spending.
The challenges for consumers in 2016 are far from over. No one know if the reserve... ››› more
Chris Hart, regular contributor to the South African Investor predicts that the rand will hit R60 to the dollar by 2019. He also believes that credit ratings agencies will soon declare South Africa's junk status before the end of this year. This is bad news for South African Investors. But just how worried should you be? And is there anything you can do to hedge your investments against this event... ››› more
On 16 December 2015 Brazil was downgraded to ‘junk' status by the Fitch credit ratings agency.
The country's large budget deficit and political turmoil were the main reasons for this move.
But guess what?
Far from being the train smash you'd expect it to be, the country's stock market is now one of the best performing ones in the world!
In fact, Brazil's stock market is UP 14.1% in d... ››› more
Earlier today, credit ratings agency Standard & Poor's announced that it had downgraded Eskom's current credit rating.
This follows last week's decision by Eskom to suspend four of its board members, including its CEO.
Let's take a closer look at what's going on…
Eskom’s credit rating now stands at BB+
Standard & Poor’s downgraded Eskom’s “rating to junk after the South Af... ››› more
Shares of African Bank Investments, more commonly known as ABIL, has seen its shares tumble today. This follows an announcement by ABIL about ratings agency Moody's view of its debt status. Due to Moody's concerns over the bank's debt, it has dropped its debt status to junk. Let's take a closer look at what's going on…
Moody’s is concerned over high rate of bad loans
Moody’s has cut A... ››› more
Following a negative trading statement about its second quarter, yesterday Standard & Poor downgraded AngloGold Ashanti's credit rating to junk bond status. Read on to find out what this means for the gold miner…
Yesterday, ratings agency Standard & Poor (S&P) dealt the world’s third largest producer of the yellow metal another blow. AngloGold Ashanti’s “credit rating was downgraded to j... ››› more
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