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Satchu's Rich Wrap-Up
Wednesday 18th of June 2014

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Normal Board - The Whole shebang
Prompt Board Next day settlement
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Macro Thoughts

Home Thoughts

“What goes around may come around, but it never ends up exactly the
same place, you ever notice? Like a record on a turntable, all it
takes is one groove's difference and the universe can be on into a
whole 'nother song.”
― Thomas Pynchon, Inherent Vice

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Law & Politics

The 2014 Global Peace Index shows a continuation of the seven year
trend for declining levels of peace globally.

Since 2008 51 countries have improved while 111 countries have
deteriorated in peace
The world has become 4% less peaceful since 2008
Europe remains the most peaceful region, with 14 of the top 20 most
peaceful countries
Syria has replaced Afghanistan at the bottom of the index, with its
Global Peace Index score falling 84% since 2008
Georgia showed the largest improvement in peace levels
The total economic impact of containing violence is estimated to be
US$9.46 trillion in 2012

The world global average peace score deteriorated slightly since last
year, mainly due to global increases in terrorist activity, the number
of conflicts fought and the number of refugees and displaced people.

The ten countries most likely to deteriorate in peace in the next two
years are Zambia, Haiti, Argentina, Chad, Bosnia and Herzegovina,
Nepal, Burundi, Georgia, Liberia and Qatar.

read more

GLOBAL PEACE INDEX 2014 Global Rankings
Law & Politics

1       Iceland 1.189
36      Botswana        1.678
44      Zambia  1.791
47      United Kingdom  1.798
48      France  1.808
48      Namibia 1.808
50      Lesotho 1.839
59      Oman    1.889
59      Tanzania        1.889
61      Ghana   1.902
66      Madagascar      1.942
66      Sierra Leone    1.942
68      Gabon   1.945
72      Senegal 1.974
74      Djibouti        1.979
77      Malawi  1.995
78      Burkina Faso    1.998
79      Tunisia 2.001
80      Saudi Arabia    2.003
80      Togo    2.003
82      Mozambique      2.004
87      Swaziland       2.056
93      Equatorial Guinea       2.079
94      The Gambia      2.085
99      Haiti   2.127
100     Benin   2.129
101     United States of America        2.137
102     Angola  2.143
108     China   2.207
109     Republic of the Congo   2.211
110     Uganda  2.221
111     Bahrain 2.225
113     Cameroon        2.235
114     Algeria 2.239
118     Guinea  2.296
120     Mauritania      2.350
121     Niger   2.351
122     South Africa    2.364
124     Eritrea 2.377
130     Burundi 2.418
131     Iran    2.437
132     Kenya   2.452
133     Libya   2.453
135     Mali    2.465
137     Rwanda  2.494
138     Mexico  2.500
139     Ethiopia        2.502
140     Cote d' Ivoire  2.520
141     Ukraine 2.546
142     Chad    2.558
143     Egypt   2.571
143     India   2.571
145     Guinea-Bissau   2.591
148     Zimbabwe        2.662
149     Israel  2.689
151     Nigeria 2.710
152     Russia  3.039
153     North Korea     3.071
154     Pakistan        3.107
155     Democratic Republic of the Congo        3.213
156     Central African Republic        3.331
157     Sudan   3.362
158     Somalia 3.368
159     Iraq    3.377
160     South Sudan     3.397
161     Afghanistan     3.416
162     Syria   3.650


Its a more dangerous World.

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Iraq’s military said it repelled an attack by an al-Qaeda breakaway group about 55 kilometers (34 miles) north of Baghdad
Law & Politics

Obama Holding Off on Airstrikes as Iraq Risks Breakup


The U.S. is struggling to help keep Iraq from coming apart at the
seams, as the Obama administration signaled that airstrikes aren’t

National Security Council spokeswoman Bernadette Meehan and Pentagon
spokesman Rear Admiral John Kirby each said last night that Obama
hadn’t yet made a decision about military options.

Obama met with top members of his security team on June 16 to explore
the range of available military and diplomatic options. One
possibility being considered is a highly selective campaign of
pinpoint strikes with drones or fighter jets against Sunni militants
akin to U.S. operations in Yemen, the New York Times reported, citing
U.S. officials it didn’t identify.

“The President has been clear, that this is not primarily a military
challenge,” Carney said. “It is still very much an imperative that
Iraq’s political leaders take steps to become more united, to govern
in a non-sectarian manner.”

“I think we are looking at a de facto partition of Iraq,” he said in
an interview.

read more

Selling terror: how Isis details its brutality By Roula Khalaf and Sam Jones FT
Law & Politics

It is not a corporation and does not have shareholders, but the
military success and brutality of the jihadi group surging through
Iraq have been recorded with the level of precision often reserved for
company accounts.

Since 2012 the Islamic State of Iraq and the Levant, (known as Isis)
has issued annual reports, outlining in numerical and geographical
detail its operations – the number of bombings, assassinations,
checkpoints, suicide missions, cities taken over and even “apostates”
converted to the Isis cause.

Premier's wife to bring a touch of soft power


When Premier Li Keqiang visits the United Kingdom and Greece this
week, one of the most prominent members of his entourage will be his
wife, Cheng Hong.

Her presence on the trip suggests China is already reaping handsome
rewards from her early forays — and those of Peng Liyuan, wife of
President Xi Jinping — into soft diplomacy.

Li visited Europe twice last year without Cheng, but she was by his
side when he visited Angola, Ethiopia, Kenya and Nigeria last month.

"Xi and Peng are regarded as an important political couple in Europe,"
Picquart said. "It has been increasingly obvious that Chinese leaders
are paying greater attention than before to the influence of soft
diplomatic arrangements during official visits."

"I think Xi's wife Peng Liyuan is an important messenger of China's
soft power," Islam said. "Diplomatically, the presence of Li and his
wife will also be good for China's image.'


Soft Power The Star


“Water is fluid, soft, and yielding. But water will wear away rock,
which is rigid and cannot yield. As a rule, whatever is fluid, soft,
and yielding will overcome whatever is rigid and hard. This is another
paradox: what is soft is strong.” Lao Tzu.

read more

Currency Markets at a Glance WSJ
World Currencies

Euro 1.3547
Dollar Index 80.61
Japan Yen 102.20
Swiss Franc 0.8996
Pound 1.6964
Aussie 0.9333
India Rupee 60.18
South Korea Won 1023.00
Brazil Real 2.2618
Egypt Pound 7.1489
South Africa Rand 10.8480

Dollar Index 3 Month Chart INO 80.61


Euro versus the Dollar 3 Month Chart 1.3547



Commodity Markets at a Glance WSJ


Gold 1 Year Chart INO 1267.95 Last


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Crude Oil 5 day Chart INO 105.89 [could spike big at any moment]
World Currencies

The Brent contract rose 51 cents to $113.45 yesterday, the highest
close since Sept. 9.

read more

Israeli Foreign Affairs Minister Lieberman Leads Roadshow to Africa, Where Israeli Exports Total $1.4 Billion

Israeli Foreign Affairs Minister Avigdor Lieberman is leading a
delegation of 50 Israeli executives to Africa this week, Bloomberg
News reported on Monday.

Israel’s sub-Saharan exports reached $1.4 billion in 2013, almost four
times the total of $374 million a decade ago, according to Shauli
Katznelson, director of the economic division at the Israel Institute
for Export and International Cooperation, in Tel Aviv, Bloomberg

Bloomberg said the push into Africa was to diversify from Israel’s
exports to Europe, its largest trading partner, where the threat of
international boycotts against Israeli companies that operate in the
West Bank has dampened enthusiasm for Israeli products, “though the
economic impact of the move was minimal.”

South Africa All Share Bloomberg +10.063% Record All Time Closing High


50,911.05 +147.34 +0.29%

Dollar versus Rand 6 Month Chart INO 10.8455 [has lost a lot of ground]


Egypt Pound versus The Dollar 3 Month Chart INO 7.1495


Egypt EGX30 Bloomberg +23.798% 2014


8,396.82 -125.34 -1.47%

Nigeria All Share Bloomberg -0.4694% 2014


41,135.70 -313.82 -0.76%

BREAKING NEWS: At least 13 people killed and 20 severely injured in
bombing of soccer-viewing venue in northeast Nigeria: @Reuters witness


Boko Haram whose leader Abubakar Shekar taunted President Goodluck
Jonathan with the comment ''I am in your city.'' [or is it Cities?]


Abubakar Shekar


Ghana Stock Exchange Composite Index Bloomberg +10.0699% 2014


Brazil opens up new US$2 billion credit line to Angola


Brazil has opened up a new US$2 billion credit line to Angola for use
in the energy and construction sectors, Angola’s Finance Minister,
Armando Manuel said in Luanda Monday.

Speaking to state TV station Televisão Popular de Angola, the minister
said that the new credit line increased the total figure to US$7.83
billion, “which makes it clear that there is a growing link between
the two countries.”

Brazilian construction group Odebrecht, which is involved in
construction and agriculture, is Angola’s largest private employer.

Recently the United States opened up a credit line to Angola worth
US$1 billion for acquisition of railway and electrical equipment from
the General Electric group.

The cap on lending rates rises to 28 percent from 21 percent effective
immediately, Tukiya Kankasa-Mabula, deputy governor in charge of
administration, said in an e-mailed statement today. Zambia


The central bank introduced the limits in December 2012 to spur
economic growth and create jobs through lowering the cost of capital.
Yields on Zambia’s one-year treasury bills reached a record 19.99
percent at an auction last week. The kwacha has lost 10 percent
against the dollar this year, the biggest drop among the 24
most-traded African currencies after Ghana’s cedi, according to data
compiled by Bloomberg.

read more

The Kenyan military says it. The African Union says it. Even al-Shabaab says it. But President Uhuru Kenyatta not only refuses to say it; he actively denies it. FT
Kenyan Economy

The government on Tuesday deployed paramilitaries to what it called
“flashpoints” that could fall prey to an attack similar to that in
Mpeketoni. Troops have been stationed not near Somalia but in ethnic
strongholds that support Mr Odinga, a Luo – including in western Kenya
and Nairobi’s largest slum. Isolated riots are already reported.

If al-Shabaab hoped its attacks on Kenya would destabilise the east
African regional giant, it is at risk of succeeding in more ways than

Somali Islamist group not behind Kenya coast attacks: president @Reuters


Kenya's president said on Tuesday that two days of attacks on the
coast in which about 65 people were killed were planned by "local
political networks", dismissing claims by Somalia's al Shabaab
Islamist group that it was behind the assaults.

"The attack in Lamu was well planned, orchestrated and politically
motivated ethnic violence against the Kenyan community," President
Uhuru Kenyatta told the nation in an address, referring to Lamu county
where the attacks took place.

"This, therefore, was not an al Shabaab terrorist attack. Evidence
indicates local political networks were involved in the planning and
execution of the heinous crime. This also played into the opportunist
network of other criminal gangs," he said.


And in a Live Rebuttal after that Press Conference

@HSMPress_  ·  58s If the facts don't fit the theory, change the
facts. #Jubilee has made conscious decision to change the facts.


Kenyan Leader Blames Domestic Foes, Not Shabab, for Attacks NYT


NAIROBI, Kenya — As Kenyan officials reported a second lethal attack
on a coastal village, Kenya’s president said Tuesday that the
violence, which has left at least 57 people dead, was the work of
“local political networks” and was not carried out by the Shabab, a
Muslim extremist group that has claimed responsibility.

“The attack in Lamu was well-planned, orchestrated and politically
motivated ethnic violence against a Kenyan community,” said President
Uhuru Kenyatta, addressing the nation and referring to the county
where the attack occurred, which includes the Lamu Island tourist
resort. He said the killings involved an eviction attempt but did not
elaborate or provide evidence.

“This, therefore, was not an Al Shabab terrorist attack,” he said.
“Evidence indicates local political networks were involved in the
planning and execution of the heinous attacks. This also played into
the opportunist network of other criminal gangs.”

Some analysts questioned whether Mr. Kenyatta’s effort to shift the
blame was part of a ploy to deflect attention from the government’s
failure to protect civilians from the spate of violence. Others saw
the president’s words as a reaction to mounting criticism by the main
opposition party, which has forcefully rebuked the government for its
apparent weakness in the face of attacks that many believe were
orchestrated by the Shabab, which is based in Somalia.

Kwamchesti Makokha, a columnist for The Daily Nation, a Kenyan
newspaper, was skeptical of the president’s statement. “One has to
give the president the benefit of the doubt, but there are huge
inconsistencies in that narrative,” he said in a telephone interview.
“It would be very worrying if political issues would be allowed to
spill into security matters. It does not make sense. He has more
explaining to do.”

The attack on Majembeni came one night after the raid on Mpeketoni,
near Lamu Island, which left at least 48 people dead. The Shabab
claimed responsibility for that attack in a statement that warned
tourists to visit “at their own peril.”

The group also claimed responsibility for the second attack, Reuters
said. It quoted the group’s spokesman for military operations, Sheikh
Abdiasis Abu Musab, as saying it had killed as many as 20 people,
mostly police officers.

Mr. Kenyatta said the police officers who had been unable to prevent
this week’s attacks had been suspended and would be immediately
charged in court. “We are all hurting,” he said, calling for the
country to unite. “Many of us are angry.”


read more

We are being spun ‘’an epic poem, the bedtime story.’’ 19-MAY-2014
Kenyan Economy

Disbelief can be suspended, of course but eventually we reach a Marx
Brothers in duck soup moment.

‘’Well, who you gonna believe, me or your own eyes?’’

Kenyan police officers walked past a bonfire used to barricade a
main road in Mpeketoni, Kenya, on Tuesday. @NYTimes


10-year Kenya bond yielded less than 7% but this compared with 2.6% on
U.S. Treasuries  1.35% on German Bunds 0.6% Japan via @Reuters


"Security is a concern but it's not a showstopper," said de Klerk

Kenya's $2 billion bond attracted more than $8 billion in orders, over
four times the issue size. However, this was well below the bubble
territory of previous years, such as the 15 times oversubscription of
Zambia's debut $750 million bond in 2012.

But frontier debt market returns of 9 percent this year and spread
levels at their tightest in a year suggest to some that there may not
be too much more upside.

Local currency debt, in contrast, has been underperforming emerging
and frontier dollar debt this year.

Salman Ahmad, global fixed income strategist at Lombard Odier, pointed
to local debt yields in investment grade-rated India of 8.5 percent,
comparing favourably with Kenya's dollar-based yields. "Frontiers are
facing ... much higher yields in emerging market local currency," he

Kenya’s tourism industry faces renewed threat from al-Shabaab FT Subscriber


Kenya’s beleaguered tourism industry faced renewed crisis as a fresh
wave of attacks on the country’s coastline by al-Shabaab militants
sent further chills through the sector.

Simon Lentimas, a 26-year-old vendor outside the nearby Reef Hotel,
tells of the day he found a bomb in a bag under a tree.

“A young guy left his bag before he went to swim,” he explains. “When
he came back he bought a ‘Kenya’ bracelet from my stall . . . but he
never came back for his bag.”

Realising it was a bomb he raised the alerted – but it exploded and
blew the roof off a kite surf shed. “No tourism here since that day,”
he adds.

Briton David Grant also refused to quit his £9,000 family vacation in
nearby Diani. “This is a holiday of a lifetime for us – it’s
paradise,” he says.

read more

Diamond Trust Bank rights issue gets CMA nod
Kenyan Economy

Diamond Trust Bank has received the nod from Capital Markets Authority
to raise additional funds from shareholders through a rights issue.

Shareholders will be required to buy one share for every 10 currently held.

The cash call is expected to raise about Sh2.4 billion with part of
the cash meant to raise the bank’s authorised share capital to Sh1.2
billion from the current Sh1 billion.

The rights issue follows a resolution passed during DTB annual general
meeting held on March 4, 2014.

New shares to be issued will be listed on the Main Investment Market
Segment of the Nairobi Securities Exchange following closure of the
rights issue and subject to approval of CMA. The period of acceptance
of the rights issue will open on 30 June 2014 and close on 25 July


Its a small Rights Issue and will be subscribed in full.

Diamond Trust Bank share price data +27.0833% 2014


Par Value:                  4/-
Closing Price:           244.00
Total Shares Issued:          220100096.00
Market Capitalization:        53,704,423,424
EPS:             21.61
PE:                 11.291

FY Earnings through 31st December 2013 versus through 31st December 2012

FY Loans and Advances Net to Customers 110.945439b versus 87.707243b +26.495%
FY Profit Before Tax 7.235003b versus 6.027899b +20.025%
FY Profit After Tax 5.230754b versus 4.067978b +28.58%
FY Earnings Per Share 21.61 versus 17.44 +23.91%
FY Dividend 2.10 versus 1.90 +10.526%

Nakumatt secures Sh3bn KCB loan for Shoprite buyout


Nakumatt supermarkets has signed a Sh3 billion loan deal with KCB to
finance the acquisition of three Tanzanian stores previously owned by
giant South African retailer Shoprite.

The loan is expected to fully finance the buy-out, according to the
Nakumatt Holdings managing director Atul Shah.

“The acquisition of the three Shoprite Tanzania stores was 100 per
cent financed by KCB. We are set to start operations early next
month,” said Mr Shah in an interview.

Kenya Shilling versus The Dollar Live ForexPros 87.605


Nairobi All Share Bloomberg +8.92% 2014 [-1.168% this week]


Nairobi ^NSE20 Bloomberg -3.288% 2014 [Sep 2013 Lows]


Every Listed Share can be interrogated here


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by Aly Khan Satchu (www.rich.co.ke)
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June 2014

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