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"I live not in dreams but in contemplation of a reality that is
perhaps the future." -- Rainer Maria Rilke
Russia freezes Ukraine into submission: Kiev admits country doesn't have enough fuel for winter
Law & Politics
The Ukrainian government admits that it does not have enough fuel to
heat homes and keep factories running through the winter. And the
crisis comes with an economy already in meltdown. It was expected to
contract by 7 per cent, but Valeria Gontareva, head of the National
Bank of Ukraine, warned at the weekend that the real figure is likely
to be 10 per cent. Exports to Russia, a key market, will fall by 35
per cent, she added; meanwhile the currency, the hryvnia, has
depreciated by 50 per cent against the dollar in the past nine months.
After Russia cut off gas supplies to Ukraine in a dispute over unpaid
bills, Kiev sought to replace the shortfall through "reverse flows",
taking Russian gas from countries such as Poland, Hungary and
Slovakia. But Gazprom, Russia's state gas company, has complained over
the practice, denouncing it as " a semi fraudulent mechanism" and
threatened to reduce exports to these states so that none is left to
send on to Ukraine.
Speaking at the Yalta international conference, held in Kiev this year
after the annexation of Crimea by the Kremlin, Ukraine's Energy
Minister, Yuriy Prodan, accused Russia of "blatantly using gas as a
political tool". To survive the winter, he added, "rather unpopular
measures, including administrative ones aimed at reducing energy
consumption, will have to be taken".
Entirely predictable. As I have mentioned previously I feel Putin is a
side show where the main Play is the Pivot to Asia.
And propelling him into Xi Jinping's embrace was shortsighted because
it effectively created a Triangulation.
U.S. to Assad: Beware of interfering with U.S. air power in Syria
Law & Politics
The Syrian military's air defenses would face retaliation if Syria
attempted to respond to U.S. air strikes that are expected against
Islamic State targets in Syria, senior U.S. officials said on Monday.
President Barack Obama's authorization of the use of American air
power against Islamic State's strongholds in Syria has raised the
question of whether Syrian President Bashar al-Assad would respond in
Senior U.S. officials who briefed reporters said Assad should not
interfere, that the United States has a good sense of where Syrian air
defenses and command-and-control facilities are located.
Picking up the signal through the noise of our world in 2014 is no easy thing. 25-AUG-2014
Law & Politics
In fact, my view is the new normal is a very arrhythmic world. When I
plugged ''arrhythmia'' into my computer, it threw up this;
''For years he'd been studying the phenomenon of chaos, of which an
arrhythmic heartbeat was a perfect example''
His excellency Johan Borgstam told me the signal announcing this new
arrhythmic normal was the disappearance of the MH370. Since then
planes have been falling out of the sky like flies. And the
uncertainty around MH370 and MH17 which is sharpened by the way the
story is seemingly turned on and off took me back to Don Delillo
'"We are not witnessing the flow of information so much as pure
spectacle, or information made sacred, ritually unreadable. The small
monitors of the office, home and car become a kind of idolatry here,
where crowds might gather in astonishment.''
The Ebola Virus continues to gain velocity and the World Health
Organisation in their latest release dated August 22 announced that
the ''magnitude of the Ebola out- break....has been underestimated''
and of ''the existence of an invisible caseload of patients who are
not being detected by the surveillance system.'' WHO spoke of ''the
existence of numerous "shadow-zones.''
Nato has thrown out a whole new characterisation of warfare called
'ambiguous' warfare. Eastern Ukraine has become a 'shadow- zone.'
Now given this new level of arrhythmia, friction,and a kind of
unsettling ambiguity, how are we to navigate the Financial Markets.
Currency Markets at a Glance WSJ
Dollar Index 84.23
Japan Yen 107.16 It touched 107.39 on Sept. 12, the highest since
Swiss Franc 0.9347
Aussie 0.9012 It declined yesterday to 89.84, the lowest since March.
India Rupee 61.09
South Korea Won 1035.15
Brazil Real 2.3426
Egypt Pound 7.1514
South Africa Rand 10.9637
The dollar has risen 3.5 percent in the past month, the best performer
among 10 developed-nation currencies tracked by Bloomberg
Correlation-Weighted Indexes. The yen has fallen 1.8 percent, the
biggest decline within the gauges. The euro has lost 0.5 percent.
Iran was The best performing stock market in the world in 2013 was up 130 per cent last year
First established in the 1960s, the TSE now has 320 listed companies,
with an aggregate market capitalisation of $130bn. There is also a
smaller over-the-counter market, the Fara bourse, which lists 180
companies, with an aggregate market capitalisation of $40bn. Combined
across both markets, $100m trades are completed on a daily basis. At
its peak last year, trading liquidity reached $250m per day.
The TSE currently trades at price-to-earnings multiple of 6 times,
with a 17 per cent dividend yield. By comparison, the MSCI Frontier
Markets index trades at price-to-earnings multiple of 12.4 times, with
a 3.7 per cent dividend yield.
If the Rapprochement gains velocity the Stock Market is going to
28-OCT-2013 @BarackObama and @HassanRouhani The Two Husseins
THE recent rapprochement between President Barack Obama and Iran's
Hassan Rouhani has certainly snapped a losing sequence in US-Iran
relations that goes all the way back to the Iranian revolution in
Hussein and Hassan are going to cut through a great deal of interfer-
ence. In this situation, there are powerful vested interests fully
invested in the status quo.
Out of Jail, Back in the Dubai Property Game
Dubai's boom-and-bust real estate market can land you behind bars or
behind the wheel of a luxury sedan. Five years after spending 140 days
in jail, Kabir Mulchandani drives a black Rolls-Royce to a building
site to watch cranes work on one of his company's three projects,
which will have a combined value of about 6 billion dirhams ($1.6
billion) when completed. "I guess the beauty of life is its
uncertainty," says Mulchandani, chief executive officer of SKAI
Holdings. "I went from making corporate deals, hanging out on a yacht,
and living in Emirates Hills to sharing a jail cell with eight
Born in India and educated in the U.S., Mulchandani fell in love with
Dubai in 2003 when he stopped for a free two-day stay in the city
offered by Emirates airline. From his hotel room window, he saw
construction springing up all over the area and decided right then to
enter the market, even though he'd never been in the real estate
Using money he'd earned from the sale of his consumer electronics
business in India, Mulchandani bought a four-story building and sold
it within months for a 20 percent profit. Over the next few years, his
company, Dynasty Zarooni, purchased and resold hundreds of properties,
including many that hadn't been built yet--a common practice as Dubai
became one of the world's fastest-growing real estate markets. "There
was nothing in what we did that almost everyone in Dubai wasn't
already doing," he says. "It's just that we did it on a much bigger
In August 2008, he says, he grew alarmed about the pace of price
increases and the eagerness to borrow money to buy property. "When you
see that, you know something is fundamentally wrong," he says. Within
weeks he sold all the uncompleted properties in his portfolio, he
says. A month later the collapse of Lehman Brothers intensified the
global financial crisis, and Dubai's property market crashed.
In Dubai buyers customarily pay for property by giving the seller a
packet of postdated checks to be deposited later. As a result, when
the bubble burst, buyers were stuck paying installments for homes and
buildings purchased at peak prices, including unbuilt ones. In 2008,
Dynasty Zarooni, which was still responsible for collecting payments
on the properties it sold to other investors, held more than 100
million dirhams in postdated checks from buyers.
"I went from making corporate deals, hanging out on a yacht, and
living in Emirates Hills to sharing a jail cell with eight
In early 2009, disgruntled customers filed complaints accusing
Mulchandani of selling nonexistent properties. He turned himself in
and was released from jail months later, when Dubai's Land Department
determined that he had complied with all laws and regulations and
cleared him of the charges.
After spending two years dealing with other legal matters related to
the crash, Mulchandani in 2011 became convinced Dubai was on the mend.
He started SKAI Holdings and took over three half-built properties
from a Turkish developer that ran out of cash. In 2012, two days after
a broker told him a piece of land on the Palm Jumeirah artificial
island was on the market, Mulchandani bought the 320,000-square-foot
waterfront plot for 400 million dirhams. With that prime piece of land
in his portfolio, Mulchandani persuaded China State Construction
Engineering (601668:CH) to invest $1 billion in SKAI to develop the
site. China State Construction, which will act as builder for the
project, declined to comment on the partnership.
SKAI's plans for the property include a luxury resort to be run by
Viceroy Hotels & Resorts. SKAI is also putting up twin hotel and
apartment towers in Jumeirah Village, about 12 miles inland.
Mulchandani says the company has already sold about 1,200 hotel rooms
and apartments, about 30 percent of them to buyers from China. SKAI is
selling properties "off plan"--before they are built--the practice that
played a role in Dubai's property crash and the CEO's legal woes.
Mulchandani says the market is less risky today because authorities
introduced rules to rein in speculation and cool the market.
Developers must pay for land in full and have at least 20 percent of
the construction cost in hand before starting sales. Also, the United
Arab Emirates central bank last year moved to stem rising prices by
restricting the size of mortgages. "There is no doubt the market has
been stable this year with stricter regulations," says Mulchandani.
"Developers and buyers are also maturing and realizing that doubling
your investment in six months can also mean losing it in the same
amount of time."
Obama to announce Ebola force of 3,000 US military personnel
Administration officials said on Monday that the new initiatives aimed
to train as many as 500 healthcare workers a week; erect 17 healthcare
facilities in the region of 100 beds each; set up a joint command
headquartered in Monrovia, Liberia, to co-ordinate between US and
international relief efforts; provide home healthcare kits to hundreds
of thousands of households, including 50,000 that the US Agency for
International Development will deliver to Liberia this week; and carry
out a home and community-based campaign to train local populations on
how to handle exposed patients.
The Mathematics of Ebola Trigger Stark Warnings: Act Now or Regret It WIRED
The Ebola epidemic in Africa has continued to expand since I last
wrote about it, and as of a week ago, has accounted for more than
4,200 cases and 2,200 deaths in five countries: Guinea, Liberia,
Nigeria, Senegal and Sierra Leone. That is extraordinary: Since the
virus was discovered, no Ebola outbreak's toll has risen above several
hundred cases. This now truly is a type of epidemic that the world has
never seen before. In light of that, several articles were published
recently that are very worth reading.
The most arresting is a piece published last week in the journal
Eurosurveillance, which is the peer-reviewed publication of the
European Centre for Disease Prevention and Control (the EU's
Stockholm-based version of the US CDC). The piece is an attempt to
assess mathematically how the epidemic is growing, by using case
reports to determine the "reproductive number." (Note for
non-epidemiology geeks: The basic reproductive number -- usually
shorted to R0 or "R-nought" -- expresses how many cases of disease are
likely to be caused by any one infected person. An R0 of less than 1
means an outbreak will die out; an R0 of more than 1 means an outbreak
can be expected to increase.
The Eurosurveillance paper, by two researchers from the University of
Tokyo and Arizona State University, attempts to derive what the
reproductive rate has been in Guinea, Liberia and Sierra Leone. (Note
for actual epidemiology geeks: The calculation is for the effective
reproductive number, pegged to a point in time, hence actually Rt.)
They come up with an R of at least 1, and in some cases 2; that is, at
certain points, sick persons have caused disease in two others.
You can see how that could quickly get out of hand, and in fact, that
is what the researchers predict. Here is their stop-you-in-your-tracks
In a worst-case hypothetical scenario, should the outbreak continue
with recent trends, the case burden could gain an additional 77,181 to
277,124 cases by the end of 2014.
That is a jaw-dropping number.
The first possibility is that the Ebola virus spreads from West Africa
to megacities in other regions of the developing world. This outbreak
is very different from the 19 that have occurred in Africa over the
past 40 years. It is much easier to control Ebola infections in
isolated villages. But there has been a 300 percent increase in
Africa's population over the last four decades, much of it in large
The second possibility is one that virologists are loath to discuss
openly but are definitely considering in private: that an Ebola virus
could mutate to become transmissible through the air... viruses like
Ebola are notoriously sloppy in replicating, meaning the virus
entering one person may be genetically different from the virus
entering the next. The current Ebola virus's hyper-evolution is
unprecedented; there has been more human-to-human transmission in the
past four months than most likely occurred in the last 500 to 1,000
years. Each new infection represents trillions of throws of the
Like Besser, Osterholm says that the speed, size and organization of
the response that is needed demands a governmental investment, but he
looks beyond the US government alone:
We need someone to take over the position of "command and control."
The United Nations is the only international organization that can
direct the immense amount of medical, public health and humanitarian
aid that must come from many different countries and nongovernmental
groups to smother this epidemic. Thus far it has played at best a
collaborating role, and with everyone in charge, no one is in charge.
I predict African equity markets will make it a three-year bull year phenomenon. 20-JAN-2014
In particular, I feel that the international Investor component
invested in Africa Inc. remains a long way below benchmark and that
the move towards benchmark has a long way to go and is a big macro
structural thing. And of course, there is our big Wembley stadium
moment with the eurobond, which is now imminent.
I incline to the view that the Kenya government should slot the
Eurobond market the full $2bn. This eurobond issue will release the
pressure cooker that is the domestic bond and interest rate markets--we
should see a good rally in interest rates. Hopefully, the banks will
go for some volume and not just spread and the economy can get juiced
a little on lower interest rates.
Implementation of the Customs Union Protocol has had a positive impact on intra-East African Community trade which has grown from $2 billion in 2005 to $5.5 billion in 2013, a growth of 36.36%.
The acting Chair of Council of Ministers, Dr. Abdulla Saadala was last
week responding to the questions by Shy-Rose Bhanji on behalf of the
Council of Ministers who wanted to know among others, the percentage
of growth achieved by the region.
Dr. Saadala said that intra-EAC trade as a percentage of total EAC
trade has made modest growth from 7.5% in 2005 to 10.5% in 2013.
Russia, Zimbabwe to Develop Nation's Biggest Platinum Mine
Russia and Zimbabwe will jointly mine platinum in the African
country's Darwendale district, Russian trade minister Denis Manturov
and Zimbabwean foreign minister Simbarashe Mumbengegwi said in a joint
"The priority for us is the Darwendale Platinum Project," Manturov
said in Harare today, adding that the agreement to dig the metal in
Zimbabwe was the "beginning of our bi-lateral cooperation."
In August Zimbabwe's Mines Minister Walter Chidakwa said Russia's OOO
VI Holding and state corporations Rostec and Vnesheconombank would
invest $1.6 billion in the project, about 40 kilometers (25 miles)
north of Zimbabwe's capital, Harare. At an eventual production
capacity of 600,000 ounces per annum it will be the country's biggest
mine for the metal.
Currently South African companies Impala Platinum Holdings Ltd. (IMP),
Aquarius Platinum Ltd. (AQP) and Anglo American Platinum Ltd. (AMS)
are the sole miners of platinum in Zimbabwe, which has the world's
second-biggest deposits of the metal after South Africa. Russia's OAO
GMK Norilsk Nickel is the biggest producer of the metal not based in
The venture will be officially opened tomorrow with Russian Foreign
Minister Sergei Lavrov expected to officiate.
"We are proud that Russia has been chosen to develop on of the richest
platinum deposits in Zimbabwe," Manturov said.
"This will go a long way towards fulfilling our natural desire to
elevate the level of our economic cooperation to the same level as our
diplomatic cooperation," the Zimbabwe foreign minister said.
Russia would also like to supply military hardware, helicopters and
trucks to Zimbabwe, Manturov told reporters.
Zimbabwe will cut the royalty imposed on gold producers to 5 percent
from 7 percent to boost production
Kenya's president @UKenyatta approves 5 pct capital gains tax Reuters
Kenya's President Uhuru Kenyatta has signed into law a 5 percent
capital gains tax that investors say could affect investment in
property, equities and the country's nascent oil and mining sectors.
The finance bill approved by parliament in late August will take
effect on Jan. 1, changing how taxes are applied in East Africa's
biggest economy, the presidency said in a statement late on Sunday.
The plans for a capital gains tax were first announced in June 2013's
budget, leading to a sharp decline in share prices as investors
fretted the tax might sap the appeal of equities. The shilling also
came under pressure, reflecting concerns about possible damage to the
"It will have an effect, especially on equities and fixed income.
Paying taxes is not something people enjoy doing. It complicates a lot
of things. So I would say yes, it would really affect how foreign
investors view the market," a senior fixed income analyst at one
investment bank said on Monday.
Capital gains tax was dropped by the country in the mid-1980s to
attract foreign and local investment.
"I think given the fact that it is optically such a low number, and
keeps Kenya at the bottom of capital gains tax... we'll look through
this and move on," said Aly Khan Satchu, independent analyst.
"If ... they are thinking of putting it higher, then I think we are in
a little different situation."
Tanzania, the region's second-biggest economy charges a capital gains
tax at 20 percent for foreign-owned firms and 10 percent for
residents. Uganda has a capital gains tax of 30 percent while nearby
Mauritius does not tax capital gains.
Rotich and other Treasury officials were not available to give details
of how the tax would be applied or how much it could raise annually.
Analysts estimated the country could rake in an additional $85 million a year.
15-SEP-2014 :: Self-Listing and Coming of Age of the @NSEKenya
The key issue is to sell cheap, make sure buyers have a profit and
keep the pipeline greased and lubricated. This will create a posi-
tive feedback loop and politically will tip the balance convincingly
in the President's favour.
Mrs Margaret Thatcher won a record breaking three terms in the United
Kingdom on the basis of expanding the ownership society. You do not
expand the ownership society by leaving citizens/shareholders nursing
losses. To do so is practically criminal negligence. You leave them
with profits like the Nairobi Securities Exchange did last week.
This tribe of two million shareholders are worthy of our politicians'
attention because they can tip the balance. Therefore, I'm now looking
forward to a slew of well-priced IPOs and a return of the 'feel-good'
BRITAM EA +94.719% 2014 and at a Record share data here
Closing Price: 29.50
Total Shares Issued: 1891451850.00
Market Capitalization: 55,797,829,575
First Half Total Revenue 10.242907b versus 7.986244b +28.256%
First Half Total Expenses 7.385814b versus 5.792327b +27.5103%
First Half Profit before Tax 3.009596b versus 2.280325b +31.98%
First Half Profit After Tax 2.746388b versus 2.158341b +27.245%
First Half Earnings Per Share 1.45 versus 1.14 +30.63%
First Half Gains on revaluation of financial assets at Fair Value
through other comprehensive income 3.295442b versus 1.512583b