Good morning,
People love the markets for different reasons. Apart from the obvious appeal of wealth creation and trading profits, there's the intellectual challenge of trying to piece together information and identify trends. There's always a fresh and juicy story somewhere in the markets, sending share prices soaring or plummeting as a result.
Unfortunately, the last day or so has seen a couple of unpleasant stories in the South African market. The record unemployment data wasn't a surprise, let's face it, but that doesn't make it any more acceptable. In this context of desperate job-seekers and low business confidence, the truly shocking decision by the Competition Commission in the Burger King SA deal is even harder to stomach.
I worked for several years in investment banking. I've seen first-hand how deals are structured and how important liquidity is for investors and business leaders alike. Why on earth would you invest in something if you don't believe you'll be able to sell it one day?
We desperately need more private sector investment in South Africa. It's the only way we will turn this ship around. I sincerely hope for the sake of our economy that the Burger King matter is fought in court and that common sense prevails. Today's lead story is a deep-dive into why I feel so strongly about this situation.
There were deal updates from Barloworld and Shoprite, with both companies on a mission to simplify and focus on core operations. The results from African Media Entertainment gives us insight into how tough the radio business is these days. If you're looking for a business with unique operating challenges, Oceana's results announcement included everything from hurricanes through to port delays.
In case you need a dose of something ridiculous, Elon Musk is moving markets again. This time, even I think it was an accident! If you want to read my overall views on Musk and Tesla, check out this article that I wrote a couple of weeks ago.
After Musk innocently tweeted about the viral kiddies song "Baby Shark" (which I know is now playing in your head - sorry!), the shares of Samsung Publishing (which has no link to the electronics company) closed over 6% higher in South Korea. The company is a major shareholder in the producer of the song.
The markets can be shocking, weird, crazy and wonderful all at once.
With that, I wish you a productive Thursday.
The Finance Ghost
