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Macro Thoughts

Turkey's President Erdogan has hit back at the White House for using
the dollar against the Turkish currency and urged countries of the
world to challenge the dollar's global dominance in trade. Sputnik
spoke to political and economic analyst Aly-Khan Satchu, who says the
US has been "weaponizing" the dollar.

On Sunday, President Recep Tayyip Erdogan described the US as behaving
like "wild wolves" and said Ankara would pursue non-dollar trade
transactions with Russia and other countries in a bid to bypass the
dollar's global dominance.

The lira has plunged after the US targeted the Turkish currency as
part of a row over a US pastor, Andrew Brunson, who was arrested in
October 2016 over aiding an organization led by Islamic preacher
Fethullah Gulen, who Ankara believes was behind the attempted coup in
July that year. Gulen is living in exile in the US.

According to Nairobi-based political and economic analyst Aly-Khan
Satchu,the Trump administration is being increasingly belligerent in
its foreign policy.

"The dollar is a weapon and Trump is relishing his financial warfare
strategies," Mr. Satchu told Sputnik.

"We have exited a period 'when the living was easy' and the world was
awash with a golden flood of dollar liquidity. Many policy-makers
imbibed the 'Kool-Aid' and believed in this 'new normal'," Mr. Satchu
told Sputnik.

"Now we are reverting back to the status quo ante, the tide has now
reversed. President Erdogan's voodoo economics worked in the time of
the golden flood of liquidity but under today's less benign conditions
no-one except die-hard Erdogan-supporting Turkish nationalists is
prepared to throw good money after money gone bad on the basis of
Erdogan's hocus pocus monetary policy," Mr. Satchu told Sputnik.

"I am not sure if the weaponization was by design or by accident but
what is crystal clear is currencies like Turkish lira — which has
fallen 42.5 percent year to date are the equivalent of offering you an
opportunity to pick up pennies in front of a freight train (the
dollar)," Mr. Satchu told Sputnik.

"I have listened to so many folks rail against the dollar's hegemony
and for eternity. Gaddafi and Saddam spring to mind and both ended up
dead. It is not possible for Erdogan to bend the arc of monetary
policy making to his will and if he continues down this path, the
Turkish economy will continue to crater and we can see very clearly
where cratering economies end like Venezuela and Argentina," Mr.
Satchu told Sputnik.

"Erdogan is a mercurial politician but he reminds me of a man walking
around a tinderbox with a match in his hand. He is endangering himself
and his legacy is in peril," Mr. Satchu told Sputnik.

He said Donald Trump may be universally unpopular but his foreign
policy was a success for US interests.

'Trump's Aggressive Foreign Policy…Working A Treat'

"Trump's aggressive foreign economic policy is the signature success
of this administration. It is highly effective — look at Venezuela to
see its most extreme output. Iran is in a similar bind. China is in
retreat notwithstanding some bravura talk. Trump can keep it up. It's
working a treat," Mr. Satchu told Sputnik.

Mr. Satchu said the only politician who had managed to stave off a
currency attack from the dollar was Malaysia's Mahathir Mohammed in
1998.

The dollar has been the world's dominant currency ever since the 1944
Bretton Woods agreement, when it replaced the gold standard, and Mr.
Satchu said it would remain all-powerful for a long time.

"For the foreseeable future, I do not see gold, the (Chinese) RMB, or
crypto replacing the dollar. It's not going to happen in our
lifetimes," Mr. Satchu told Sputnik.

So who could be the next target for the US's ire?

South Africa, Beware!

Mr. Satchu said if politicians around the world are not wary of
upsetting the US now then they are "asleep at the wheel".

"South Africa strikes me as an example of a country that should be
worried, very worried," said Mr. Satchu, hinting at Trump's recent
tweets in which he has come out in support of white farmers who he
claimed have had their farms seized and been subjected to "mass
killings".

Ironically in 1986 the US Congress passed legislation proposing
economic sanctions against apartheid-era South Africa, but it was
vetoed by the Republican President Ronald Reagan. In the end
Republican senators voted to override the veto and the sanctions
helped bring the collapse of the apartheid regime.

Wikipedia has an article on: halcyon days and it reads thus,

From Latin Alcyone, daughter of Aeolus and wife of Ceyx. When her
husband died in a shipwreck, Alcyone threw herself into the sea
whereupon the gods transformed them both into halcyon birds
(kingfishers). When Alcyone made her nest on the beach, waves
threatened to destroy it. Aeolus restrained his winds and kept them
calm during seven days in each year, so she could lay her eggs. These
became known as the “halcyon days,” when storms do not occur. Today,
the term is used to denote a past period that is being remembered for
being happy and/or successful

Home Thoughts

The conundrum for those who wish to bet on the End of the World is
this, however. What would be the point? The World would have ended.

Turning and turning in the widening gyre
The falcon cannot hear the falconer;
Things fall apart; the centre cannot hold;
The ceremony of innocence is drowned;
The best lack all conviction, while the worst Are full of passionate intensity.
Surely some revelation is at hand;- Surely the Second Coming is at hand.

I am reading an Article by Robert Macfarlane headlined What lies
beneath. The Article begins ''We live in an age of untimely
surfacings'' and continues ''The same month, water levels in the River
Elbe dropped so far that “hunger stones” were revealed – carved
boulders used since the 1400s to commemorate droughts and warn of
their consequences. One of the stones bears the inscription “Wenn du
mich siehst, dann weine” (If you see me, weep)''

These unburials also disrupt simple notions of Earth history as
orderly in sequence, with the deepest down being the furthest back.
Epochs and periods are mixing and entangling. “The problem,” writes
the archaeologist Þóra Pétursdóttir, “is not that things become buried
far down in strata – but that they endure, outlive us, and come back
at us with a force we didn’t realise they had, a dark force of
‘sleeping giants’,” roused from their deep-time slumber.

As we scan the sky for rain clouds and sniff the air greedily for the
smell of Petrichor [Petrichor (/ˈpɛtrɪkɔːr/) is the earthy scent
produced when rain falls on dry soil. The word is constructed from
Greek petra (πέτρα), meaning "stone", and īchōr (ἰχώρ), the fluid that
flows in the veins of the gods in Greek mythology]  Petrichor odour
"... was due to the presence of organic substances closely related to
the essential oils of plants ..." and that these substances consist of
"... the fragrance emitted by thousands of flowers ..." absorbed into
the pores of the soil, and only released when displaced by rain. After
attempts to isolate it, he found that it "... ap peared to be very
similar to, if not identical with, bromo-cedren, derived from essence
of cedar." These are indeed human instincts that have been with us I
am sure since the beginning of time. Today some of us might dial up
Accuweather or some such Platform in order to inform of us of what our
[once] finely tuned bodies already understand at an elemental level.
Sifting that original and ancient Signal from the c21st Noise is
surely the problem. It is surely a fact that the Age of The Machine,
the Smart Phone and Algorithms has blunted our ability to listen to
Nature and we are evidently tone deaf not unlike those Folks on the
sidewalk who would quite likely bump straight into you whilst studying
a Tweet. The reason ''Petrichor'' comes to my mind is surely that in
the current ''rainy'' season of very light and occasional showers, I
am being in fact assailed by multiple releases of the odour.

Egypt devalued its currency early, took a brutal punch in the solar
plexus but is now reaping the dividend from its bolder economic policy

We dream of a new politics
That will renew the world
Under their weary suspicious gaze. There’s always a new way,
A better way that’s not been tried before.

Shorn of their most important campaign weapon, scandal-ridden former
President Jacob Zuma, South Africa’s biggest opposition parties are
turning to populism as they scramble for votes in the most competitive
election since the end of apartheid.
The two main challengers to the ruling African National Congress are
increasingly echoing the anti-immigrant and race-baiting bias that’s
come to dominate politics in the U.S. under Donald Trump and President
Jair Bolsonaro’s Brazil, as well as Italy and parts of Eastern Europe.
“Secure our borders” reads a campaign poster of the second-biggest
party, the Democratic Alliance. Its spokesman on immigration proposes
a “humane” deportation program for undocumented migrants he says are a
major source of crime and who take welfare checks and anti-AIDS drugs
meant for South Africans.
The signature poster of the Economic Freedom Fighters, the
third-biggest party, features a picture of its leader, Julius Malema,
emblazoned with “Son of The Soil,” a slogan that alienates Asian,
mixed-race and white South Africans.
“In South Africa, as in many countries around the world right now, you
have this fairly rapid creep to the right and nativism,” said Claude
Baissac, the head of Johannesburg-based political risk consultancy
Eunomix Business & Economics Ltd.
“Trump and Bolsonaro made it not only acceptable but fashionable. The
DA has very cynically and opportunistically taken the nationalist
route.”
In the case of the DA, analysts say the strategy threatens to alienate
its traditionally liberal base. It could also heighten tensions in a
country already riven by racial divisions and periodic xenophobic
violence.
Anti-foreigner violence led to more than 60 deaths and 50,000 being
made homeless in 2008 when footage of a Mozambican man being doused in
petrol and burnt to death made international headlines.
Similar violence has regularly resurfaced since, including this year
in the south eastern city of Durban. Zimbabweans, Mozambicans,
Malawians and even Bangladeshi and Pakistani immigrants are often the
target of the targets.
The dilemma for the two parties is renewed interest in the ANC after
the popular Cyril Ramaphosa replaced Zuma as president last year and
pledged to crack down on corruption.
That’s left both the DA and EFF seeking ways to gain voters’ attention
three years after municipal elections handed the ruling party its
lowest share of the vote since it took power in 1994.
“Foreigners are resented -- we’ve seen waves of xenophobic violence.
The DA is catching that wave,” said Nic Borain, an independent
political analyst.
“It’s going to unsettle some of its traditional supporters. It’s a
sacrifice they’ve made to their ideology because they assume they will
get more support from the black middle class.”
While the EFF has regularly criticized white South Africans since its
formation in 2013, with Malema having faced several hate speech
charges, it has widened its attacks in recent months to other racial
groups.
Last year, party Deputy President Floyd Shivambu accused Ismail
Momoniat, a South African of Asian origin who’s a deputy director
general of the National Treasury, of having an anti-black agenda.
EFF spokesman Mbuyiseni Ndlozi last month accused former Finance
Minister Trevor Manuel, who is mixed race, of facilitating the
appointment of another mixed-race South African as head of the revenue
service because of business and family ties. Manuel has denied the
allegation and threatened legal action. Ndlozi didn’t answer calls
made to his mobile phone.
“They know it’s the easiest way to grab headlines,” said Ralph
Mathekga, an independent political analyst. “You look at the soft
spots in society -- they know it’s race relations. They just stoke the
fires.”
Most analysts trace the DA’s turn to the policy to the political
ascent of Herman Mashaba, a brash self-made multi-millionaire, who’s
now the DA’s mayor of Johannesburg.
He has regularly described mainly black African undocumented migrants
as criminals and has spoken of the need for a “shock-and-awe” campaign
to drive them out of the run-down inner city.
“Herman Mashaba started this anti-African policy,” said Moeletsi
Mbeki, deputy chairman of the South African Institute for
International Affairs. “They are now looking for an expanded, African,
middle-class vote.”
DA leader Mmusi Maimane said the policy is misunderstood and the
party’s stance is a sensible approach to the number of immigrants
coming into South Africa that cause social tensions by increasing the
risk of “unskilled migration” in a nation that has an unemployment
rate of 27 percent.
He played down the comments by his spokesman on the issue, Jacques
Julius, stressing the position on deportation isn’t in the DA’s
election manifesto and said it was “anomalous” to say foreigners are
responsible for all crime.
“All health-care facilities in South Africa, all security agencies are
now being used effectively to police, to help provide health care, to
provide education for the entire sub-Saharan Africa,” Maimane said in
March 18 interview.
Yet the number of immigrants, at between three and five percent of the
population, has stayed constant since the mid-1990s, said Loren
Landau, chair of the African Centre for Migration and Society at
Johannesburg’s University of the Witwatersrand.
Municipalities face more problems coping with the larger number of
South African migrants from rural areas, he said.
Political parties “feel that this is a competitive election and they
need to compete to win votes,” said Landau. “Xenophobia acts as a
distraction from real issues. It’s dangerous to immigrants and it’s
dangerous to the country.”

Euro 1.1138
Dollar Index 98.21
Japan Yen 111.86
Swiss Franc 1.0207
Pound 1.2889
Aussie 0.7006
India Rupee 70.004
South Korea Won 1160.785
Brazil Real 3.9913
Egypt Pound 17.1815
South Africa Rand 14.4722

Boeing Co on Wednesday abandoned its 2019 financial outlook, halted
share buybacks and said lowered production due to the grounding of its
fastest-selling 737 MAX jet after two fatal plane crashes in five
months had cost it at least $1 billion so far.
Boeing shares closed up 0.4 percent at $375.46. They are still down
about 10 percent since the Ethiopian Airlines crash, wiping almost $25
billion off the company’s market value.
First-quarter operating cash flow declined to $2.79 billion, from
$3.14 billion, missing the Wall Street’s average estimate of $2.82
billion.
Revenue fell 2 percent to $22.92 billion, below analysts’ average
estimate of $22.98 billion.
Excluding certain items, Boeing said its core earnings fell to $3.16
per share, in the quarter from $3.64 per share, a year earlier. That
matched analysts’ average estimate.

The lack of touch and finesse displayed by Boeing over the last seven
days is mind-boggling. They have stayed resolutely behind the curve
from the GET-Go.
The Message Boeing sent was the Safety came second, a simply untenable
position. Eventually the FAA capitulated and grounded the 737 Max.
Ethiopian and its Government acted with a lot of decorum. Concerns
about brand damage are overblown.
In contrast, Boeing have taken a big hit but more worryingly the
corporate’s reactions to a fast moving situation were a D-.

Frontier Markets

On the same day he said, “we are in debt, we have to pay back but we
can’t. And secondarily, we aren’t able to finish projects we have
started” and announced his economic Pivot. Of course, the downside
risk of all this infrastructure is plain to see and Sri Lanka and the
tale of its Hambantota Port is now a cautionary Tale. FX reserves were
at less than a month’s worth of imports and something needed to be
done. Expectations are high.
The Prime Minister needs to execute real quick on the economic front
but if he levels the playing Field,a whole Troop of folks will be
looking to pile in. That Troop will include the Ethiopian Diaspora,
Foreign Investors and I am sure our very own Safaricom who must have
already presented the Prime minister with a copy of the MIT research
on M-Pesa which confirmed access to mobile-money services increased
daily per capita consumption levels of two percent of Kenyan
households, lifting them out of extreme poverty.

"So far, the Saudis & Emiratis have not met with us," says the head of
the SPA, which organized the #SudanProtests. Egypt offered a consular
officer. "It is as if they thought we wanted visas and not a
democratic transition."

KHARTOUM, Sudan — Amid the chants praising the “revolution of the
people,” a new slogan appeared this week at a massive sit-in protest
in Sudan’s capital: “We do not want Saudi aid even if we have to eat
beans and falafel!”
“A soft landing for the old regime is being orchestrated by some
Middle Eastern powers so that they can keep their allies in power,”
Mohamed Yusuf al- Mustafa, the head of the Sudanese Professionals
Association, said in an interview.
His coalition of doctors, lawyers and others has been central in
organizing the demonstrations. “They are not our enemies. But they are
risking the goodwill of the Sudanese people.”
“[We said] the timeline should be as quick as possible because the
streets are demanding that, and we stand in support of the people
asking for that quick transition,” James said after leaving the
meeting.

The revolutionary contingent attains its ideal form not in the place
of production, but in the street, where for a moment it stops being a
cog in the technical machine and itself becomes a motor (machine of
attack), in other words a producer of speed

What’s clear is that a very young, very informed and very connected
African youth demographic [many characterise this as a ‘demographic
dividend’] – which for Beautiful Blaise turned into a demographic
terminator – is set to alter the existing equilibrium between the
rulers and the subjects, and a re-balancing has begun. We need to ask
ourselves; how many people can incumbent shoot stone cold dead in such
a situation – 100, 1,000, 10,000? This is another point: there is a
threshold beyond which the incumbent can’t go. Where that threshold
lies will be discovered in the throes of the event. Therefore, the
preeminent point to note is that protests in Burkina Faso achieved
escape velocity. Overthrowing incumbents is all about acceleration,
momentum and speed best characterised by the German word ‘Blitzkrieg’.

Arrested at the beginning of the 1970s, on his way to prison the
popular Sudanese poet Mahjoub Sharif wrote a fervent prayer:

When will it clear
The sky of our dear Khartoum,
When will it be healed
The country’s wound?

Dollar versus Rand 6 Month Chart INO 14.462 [Oh Dear Oh Dear]
http://quotes.ino.com/charting/index.html?s=FOREX_USDZAR&v=d6&t=c&a=50&w=1

Egypt Pound versus The Dollar 3 Month Chart INO 17.176
https://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&t=f&a=&w=&v=d12

Egypt EGX30 Bloomberg +13.31% 2019
http://www.bloomberg.com/quote/CASE:IND

Commodity trader Olam International on Tuesday said it will buy
Dangote Flour Mills Plc , as it looks to bolster its position in
Nigeria’s wheat market.
Olam’s Nigerian unit, which holds a 0.1 percent stake in Dangote Flour
Mills, will buy the rest of the company for an enterprise value of 130
billion naira ($425 million).
The deal expands Olam’s reach in the pasta market in Nigeria, as it
looks to cash in on the growing demand of wheat-based products in the
region.

Ghana Stock Exchange Composite Index Bloomberg -4.16% 2019
http://www.bloomberg.com/quote/GGSECI:IND

Uganda sending its first shipment of medical marijuana to Canada in
June, worth US$160million.

Cash spent on servicing Kenya’s ballooning public debt surged 75 per
cent in nine months to March, underlining the burden debt repayments
is having on taxpayers.
Debt repayment costs hit Sh538.20 billion in the nine months from
Sh273.64 billion in a similar period a year earlier, Treasury data
shows
That means that Treasury spent an equivalent of Sh1.94 billion daily
or Sh59.8 billion monthly on debt repayments, up from Sh1.13 billion
daily and Sh34.36 billion monthly in the year ended June 2018.
Rising debt servicing costs amid below-target growth in tax collection
have seen the allocation of cash for projects such as building roads,
power lines, water and sewerage network remain depressed.
Debt repayments for the period to March was nearly thrice what Kenya
spent of development at Sh197.16 billion and more than double the
allocation to counties in the nine months at Sh205.6 billion.
Statistics show the Treasury spent an equivalent of Sh52.74 of every
Sh100 collected from taxpayers on servicing the debt in the nine-month
period, higher than Sh32.92 a year earlier and Sh31.50 in the same
period of the 2016-17 financial year.

Par Value:
Closing Price:           2.74
Total Shares Issued:          161866804.00
Market Capitalization:        443,515,043
EPS:             0.19
PE:             14.42   

Flame Tree Group FY 2018 results through 31st December 2018 vs. 31st
December 2017
FY Revenue 2.488610130b vs. 2.425090214b +2.619%
FY Cost of sales [1.727327066b] vs. [1.626812792b] +6.179%
FY Gross profit 761.283064m vs. 798.277422m -4.634%
FY Other operating income 15.164548m vs. 18.315442m -17.203%
FY Selling and distribution costs [314.158975m] vs. [321.826823m] -2.383%
FY Administrative expenses [295.652238m] vs. [335.379894m] -11.846%
FY Other operating expenses [60.856701m] vs. [59.685127m] +1.963%
FY Operating profit before gain on disposal of Property, Plant and
Equipment 105.779698m vs. 99.701020m +6.097%
FY Gain on disposal on PPE 1.539014m vs. 2.697049m -42.937%
FY Operating profit after gain on disposal of PPE 107.318712m vs.
102.398069m +4.805%
FY Finance costs [65.171401m] vs. [60.988214m] +6.859%
FY Profit before tax 42.147311m vs. 41.409855m +1.781%
FY Tax [8.362243m] vs. [1.655346m] +405.166%
FY Profit for the year 33.785068m vs. 39.754509m -15.016%
EPS 0.19 vs. 0.22 -13.636%
FY Gain on revaluation 202.755759m vs. –
FY Total comprehensive income for the year 162.866207m vs. 10.144470m
+1,505.468%
EPS (Total comprehensive income for the year) 0.91 vs. 0.06 +1,416.667%
Total Equity 813.034474m vs. 731.460183m +11.152%
Cash and cash equivalents at 31st December [279.042724m] vs.
[252.215396m] +10.637%
April 25th 2019, Nairobi – Flame TREE Group Holdings (FTGH: NSE) the
diversified manufacturer and distributor of plastic tanks, cosmetics,
snacks, spices and playground equipment, is pleased to announce its
financial performance for FY2018.
The group reported total sales for FY 2018 were up 2.62% to KES2.48
billion from KES2.42 (-5% sales decrease in FY 2017), and group
expenses were down -6.45% to KES670 million from KES717 million posted
the previous year.
The group has announced a 2% increase in pre-tax profit to KES42.1
million for the FY 2018 from KES41.4 million posted the previous year.
This includes the impact of the bad debt provision in line with IFRS9.
The Nairobi Securities Exchange (NSE) Listed firm confirmed that the
profit before tax improvement is largely attributable to improved
performance in sales and reduction in expenses.
According to Mr. Heril Bangera, CEO Flame Tree Group, the Group
performance was the result of a sales diversification strategy,
improved sales in our main market Kenya by 16% and an effort to reduce
costs and identify areas to increase efficiency and quality.
“The results of FTGH show a positive evolution compared to FY 2017 as
it outperformed its peer comparable companies in NSE. Our business
lines contributed greatly to our overall performance with reported
growth in all verticals, plastics sales grew by 5%, cosmetics by 23%
and snacks & spices by 44%. We focused on reducing the dependence on
conventional business’ so that we can enhance our revenue sources and
in so doing pursue profitability to support the business,” says Mr
Bangera. The Group is in full compliance with the new IFRS9: all
potential payment defaults have been properly classified and provided
for. This gives a clear view looking ahead to the future.
Business Outlook
Looking ahead FTGH will continue to increase sales in markets within
and outside Kenya, both through its companies in Kenya, Rwanda,
Ethiopia and Mozambique, and by increasing significantly the value of
its exports to other African countries, especially in the cosmetics
division.

Nairobi All Share Bloomberg +13.15% 2019
http://www.BLOOMBERG.COM/quote/NSEASI:IND

Nairobi ^NSE20 Bloomberg +1.40% 2019
http://j.mp/ajuMHJ

Every Listed Share can be interrogated here
http://www.rich.co.ke/rcdata/nsestocks.php