You're listening to Strictly Business Podcast with Lindsay Williams.
The JSC has closed its doors for another day, so it's time for the 5 o'clock
shadow.
And as always on a Thursday, I have the doubleheader dream team edition of Viv
Govender from the award-winning
Rand Swiss and David Shapiro from Sasson Securities.
And David Shapiro is award-winning.
I suppose the two go together.
David, I'm going to have to start with you today because...
You're not in Johannesburg, you're in New York.
And I worried about you on Monday because of the blizzard situation on the northeast
coast.
How did it affect you?
Because Aviv and I live our traveling lives vicariously through you.
Well, we were the first plane, I flew from London, I flew to London,
and we were the first plane that they allowed to land on Tuesday morning.
And they only opened up the, this is New York, they only opened up the airport at
12 and we came in like, you know.
quarter past 20 past 12.
So there were some others circling.
The airport was quite empty.
We got through customs and everything.
In fact, the poor taxi driver,
he had brought someone to the airport at nine o'clock and had to wait almost three
hours to get a journey back,
you know, to collect a fare back.
So, and planes only started to take off there.
But flying from London, you over the US coming around.
what would be the northeast Boston and that you just looked on the ground and you
saw this absolute blanket of
white and you know it's now Thursday it's still very cold the snow is still around
makes it very dangerous to walk but this is going to last I think for another week
before you start to see the melt so
yeah it's it's for for people like Viv and myself you know who are not used to this
kind of weather.
It's a big change.
You know, every step, you've got to be careful.
I went out this morning.
I wasn't going to run.
I went walking.
Yeah.
But it's so dangerous.
But Central Park must be beautiful, David.
I had a friend who got stuck there, and she wanted to come back as soon as
possible because she's got a young child,
and she was missing the thing.
And I can understand that.
But I would imagine that to be stuck in New York during this snowy period for a
young, fit person must be fantastic.
Fantastic.
No, it was beautiful.
Central Park is beautiful.
You know,
the one thing that impresses me is that how quickly workers come out and
put salt on the road and clear the snow.
And, you know, literally within hours, not even, within minutes of a snowfall, they
clear the roads.
One of the big problems is that people park on the side.
and when you clear with a...
with a front-end loader, you know, the snow's got to go somewhere.
So they just pile it on the cars and say, you're toughies, you know, we told you to
move your cars.
So they get stuck in.
They're literally stuck in the snow, you know, on the side of the road.
I saw a very good CNN piece this morning of exactly that, and a chap was walking
along thinking, you know,
I've almost got to work or to the shop or something, and along comes a snowplough,
bush, a wall of snow whacked him over.
But anyway, let's not talk about that.
Viv, NVIDIA's numbers, what did you make of them?
Spectacular, but not good enough.
That's pretty much what it was.
They were incredible numbers.
I mean, this company has a 70-something percent profit margin,
making unbelievable amounts of money each quarter.
And the market today is pretty down 3.5%.
It is basically as good as you could imagine, beat estimates, et cetera.
But, you know, again, the market had put in so much, you know, in terms of
expectations into it that it was,
you know, virtually impossible to beat it.
Yeah.
But also, it's not just the numbers that come out, as we as we well know, Viv, it's
the outlook statement, the tone of it,
the projections, how much they might make, how much they might not make.
And I believe that must be the one that has knocked it three and a half percent.
No, even the outlook was better than anticipated.
They beat Q4 expectations for results and they give a better than expected outlook
for Q1 of this year.
The market, whatever the expectations you bring in there, the market is basically,
it just was not in the mood,
unless the results were even better than this to reward Nvidia.
I do think that if you're looking at, look, here's the thing, $700 billion this
year alone is being projected for Google.
announced at least for Google, Amazon, Meta, etc.
A lot of that money is going to go directly into NVIDIA's pockets.
I think that is something to be looked at.
It is going to be a very good year for NVIDIA, however you look at it.
But even recently, we had AMD as well come out with an announcement that they would
meta about meta taking on their chips.
There is money around the whole ecosphere, but I think NVIDIA is still the front
runner.
I think because of the speed at which this stuff is going at, it's going to be very
difficult for somebody to catch up and beat them at the moment.
David, you find yourself in the camp of, yes, they were great numbers, but no, it's
not good enough for me to hold on.
So you trimmed your positions or did you look, as Viv did, in awe of these
numerals?
The whole year we've heard the same story, you know, and yet it just keeps creeping
up, ratcheting and so on.
So I'm not put off by it.
You know, the market's a bit crazy at the moment.
You don't know what they want.
I don't know whether Viv saw it or whether you saw this, but...
Over the weekend, there was this report that went viral from Citrini, I think.
Yes, that's right.
Research.
I mean, it was one of these, you know, reporting on 20,
I think called 2028 global intelligence crisis or something around that.
And really saying, look, if this is really successful, what's going to happen?
You're going to get this dystopia, you know, where markets going to crash because
people are going to be.
So many jobs will be lost and create unemployment, take down consumers and so
on.
I mean, just looking into so many years ahead,
how many people did we have to read at the end of last year or during last year about
the AI bubble?
And it's going to crash and so on.
So you get these views.
And what was interesting, though, the market got very scared.
And I know the Dow came crashing down on Monday and all other markets.
And so we're in that mood.
You know, I can't explain it.
I just look through it and I just focus on what NVIDIA is doing, what kind of chips
they're making, who they're selling to,
and how the market reacts, the emotion of the market.
You've just got to brush aside.
I don't think you should also ignore the fact that the market had been pushing up
NVIDIA ahead
of its results.
I mean, it closed at 195, I think, the night just before.
its results in the early hours of the morning, in the aftermarket or the
beforemarket, whichever it is,
they pushed it up very close to 200.
So to come down a little bit, I mean, okay, three and a half percent is a chunky
number, but to bring it down,
it's just giving up what it had gained.
So I think it's another factor, and David, you would have seen this throughout your
career, of a market being priced for perfection.
So the line of least resistance for any stock in that sort of position the nvidia
position is to the downside.
Not to say that there's anything wrong with the stock.
It's just that people have become too exuberant.
Would you say that was a fair resume of what's happened?
I don't even know.
I don't know who is exuberant.
I don't know who the people are.
You know, most analysts that we talk to or speak to, you know, they sit admittedly,
they go through the company and they're very bullish on it.
And perhaps you'll find that they'll come out now and be biased.
But you're dealing...
You know, Lindsay, we're not dealing in the same world that I entered 50 odd years
ago.
Today, it's run by algorithms.
It's run by traders.
It's run, you know, and there's huge amounts of money behind those trades.
And they play games.
You know, they're the ones who kind of influence the market, but with talk, it's
almost like propaganda.
And you've got to see your way through that.
But I've got no control.
You know, we've got no control.
They're a natural buyer.
Those who are buying it for the longer term or trying to put it in a portfolio of
growth stocks, we don't rule the markets.
This is ruled minute by minute, day by day by hedge fund traders, you know, who
really look,
what's the trend going to be tomorrow?
What's, you know, what story, what story can we pick up?
So, and to a large extent, it's fed by the media as well.
So, I'm not freaked out by this.
We're still, even if you've held NVIDIA through all this trouble, All this talk
about the end of AI.
You still made 40% or 45% this year over a 12-month period.
Okay, I can live with 45% increase.
Especially when the 10-year bond is, what, 4%?
Okay.
Exactly.
And if you'd been a clever hedge fund trader and got rid of some of the
old-school tech stocks like Microsoft or IBM,
both of which are in bear markets, and bought the AI stocks, then you're, you
know.
You're in Clover.
Viv, I want to talk about something completely different.
And you can tell me, Lindsay, I didn't have a look at them yesterday.
So don't ask me about the results from Valterra, because I spoke to somebody
yesterday who had and he said this is a money printing
machine at the moment.
It's fantastic news.
Did you happen to look at a good old fashioned South African PGM producer
yesterday, Viv?
Yeah, look, I mean, we had a, I mean, one of the guys in the office had put on a
pick for the stock about a week ago,
and he was kind of celebrating yesterday, kind of, you know, saying how bullish it'd
be.
But look, yeah, the fact of the matter is we are seeing platinum prices come back,
you know, quite dramatically.
I mean, platinum is up, you know, doubling in price, palladium up 80% almost.
And I do think that, you know, a lot of this is driven by the gold.
movement.
I mean, in the future, I think the other issues around platinum in the automobile
sector being replaced, you know, with electric vehicles.
But I do think at the moment, you know, would be the demand for gold as strong as
it is.
But the fact that I mean, platinum is, people don't realize that platinum is a
much smaller amount of supply than gold.
So if gold becomes significantly more valuable, if you just have to look at the
amount of gold being used for jewelry, etc.
And people start switching a part of that demand for gold, jewelry, platinum
jewelry, because it's cheaper.
in vertical commerce.
And I think that in that scenario alone,
it's a large enough demand to replace a lot of the capital legal vertical demand
that's out there for platinum.
So yeah, the results were great.
And to be expected, I mean, we had the commodity prices rise as much as they did.
And as I said to that person, I hope that South Africa takes full advantage of this,
and I hope the companies don't go berserk and try and buy.
obscure mines in Finland or Canada or somewhere like that with the money that
they got.
But they didn't.
They paid a special dividend.
They paid a very good ordinary dividend as well.
And long may it continue.
Speaking of South Africa, David, I know you've been on the Upper West Side this
morning, having a bagel, having a coffee, reading the paper.
So you won't have seen truest results.
But the market seems to like them.
I think they closed up about four and a third percent.
And I'm happy.
uh for truess and the retail sector and south africa and everything but i'm more
happy for myself because it might claw me out
of the bottom quartile of your crystal challenge because i put it in my in my in
my picks i think you did as well
i am i like well i i took clothing retailers i thought there had to be some
kind of margin i
mean some kind of comeback from these companies um i don't know whether i'm
going to be right or wrong um
In fact, to be honest, if you look at spa and you look at pick and pay and you look
at some of the
grocery retailers, that's where I, you know, that's always the safe haven.
But having looked at spa and pick and pay, you know, maybe it is the time for some of
the clothing retailers to come back.
But I quickly looked at, you know, the numbers.
I always look.
I just looked at the headlines and I saw that the earnings were up or headline
earnings around about 1%.
So I'm not quite sure.
whether this is far greater than the market was expecting.
But, I mean, it does give you an idea of what a tough time these companies are
going through.
So I think one has to go through this in great detail.
And maybe if the growth did come, maybe it came from their offshore businesses.
I'm not sure.
I've got to go through this in a little more detail.
It did come out quite late, I think, just as the market was closing.
You know, there's one thing I wanted to say on Veltira.
I mean the results were spectacular and absolutely incredible but if you want to
understand the platinum markets or these
markets we're far from an all-time high oh yeah there's way there's way to go yeah
if you go back 22 mom was a lot higher you know all the way back to 21 and so on so i
mean we
had some very bleak years between 22 all the way to claw your way back in and i
always say
An old saying that I picked up on the exchange, you know, you buy in these kind
of booms and you have to wait for the next boom to get your money back.
And I mean, it's typical.
It's something we used to say about the mining markets.
And it's typical in this situation where you have this credible boom in 21, 22 and,
you know, where platinum prices went up through the roof and we're back where we
are.
In fact, I don't even think the platinum price reached where it is now, but or more
or less.
But, you know, this is this is the.
nature of those markets is that you've always got to be careful these prices
don't always hold unless there is
genuinely uh demand you know a huge demand for the underlying metal and i'm not sure
that's coming back in
order catalyst or anything like this that's why that's why i speculation yeah
that's why i say david they have to take advantage of it and not not
get silly about it because it's so cyclical and it's very fleeting as well i
mean it can be a couple of years but than just at the top.
People start to get really frothy about it, and that's when the trouble starts.
Sorry, Viv, I'll come to you in a second.
I've got to do some reminiscing here.
I always think when I see results like that, and I look at the PGMs doing what
they're doing at the moment, David,
I always think of Wayne McCurry because he sort of retired just before the really big
boom,
and he was always, every time I spoke to him every Wednesday, he would talk
about...
the platinum stocks and really sort of champing at the bit waiting for this.
I'm sure he might have a small interest himself, but yeah.
Who was I going to talk to?
Oh, yes, David, very quickly, Salesforce, please, because their numbers came out,
didn't they?
I know this.
Their concern is that this is taking a little longer than everybody thought for
businesses,
enterprises to adopt AI and for them to get their business ready to do this.
It's another one that I've got to go through in detail because I see this
morning competitors like ServiceNow
and others in that area are actually up this morning quite.
quite nicely, but not Salesforce.
So, you know, in that area, Snowflake, ServiceNow, Constellation Software,
all of those are doing better this morning, up three for 4% and so on.
So, you know, in that, but in fact, Salesforce is up 3% this morning.
I didn't know it.
Can you believe it?
So there you are.
There are videos down 3%, which should be up 3%.
And Salesforce, which will be down 3%, is up 3%.
So you explain that.
I'm going to ask Viv.
That's for Viv to explain to us, you see.
Yeah, Viv, there's your invitation.
He's a mathematician, the scientist.
Yeah, well, Viv, you've got to explain that, please.
I saw this great interview with Jensen Wong, and he said,
imagine if you hired a genius to come to your office, right?
And he was also basically really skilled at a bunch of different programming
languages, a bunch of different software tools,
you'd think you'd spend less or more on software.
The answer is you'd spend more.
If you had a master carpenter come into your workplace,
do you think you'd spend more or less on woodworking tools?
You'd spend more.
And he says, if AI comes agentic, like we're talking about, you won't expect them
to go out and basically remake every single tool out there,
because it'll cost you too much, or it'll be not as good as the...
the bespoke or the stuff already made out by the public large corporations but
rather ai would be very very good at
using these tools and in that scenario why wouldn't you basically buy all the tools
possible if you
have an ai system that you basically have on your local computer that is capable of
using any software out there uh
to a level of expert level wouldn't you buy a lot more software you know what i
mean and
that made me think that yeah there is probably a lot of opportunity even for
these companies like you know salesforce and all
the other guys out there maybe they don't have you know some of the
like the cutting edge stuff out there but if they are tools and they are tools
because humans use them to basically make themselves more productive
if an air comes along and doesn't go to the entire trouble of writing the whole
tool set from scratch up again which is like unlikely to
happen that is going to be a great deal more in demand because the ai is going to
be much much
better at using the tools even if you can't write the whole thing from scratch.
And that means that more people are going to find uses for these big software
packages out there.
And so I do think that's a thing that the market may be overlooking at the moment.
Very good point indeed.
Make another very good point with your analytical brain very briefly about
yesterday's budget.
I switch off from the budget now because South African budgets have either been
depressing or boring or both in the past.
But this one, a little bit more upbeat, Viv.
Yeah, brilliant budget.
uh compared to what we had the last couple times uh a couple interesting things i
mean the jump up we saw in the tax free savings amount i mean from
36 to 46 firstly i mean we have debit orders you know that's a horrible number
to divide by 12.
you know what i mean and the second thing is that
uh well with regards to uh the brackets slightly improved but i mean we still
haven't taken up the full impact of what we
have in the past uh An interesting move with regards to the VAT number,
which is quite a big jump up there.
I do think that overall, it is a little haphazard what was improved,
but it was basically across the board improvements.
And the only thing I have is this, I don't know how sustainable it is.
Firstly, the two things they put forward as what caused this to be improved was
number one, better SARS collection.
But there's only so much you can, if you have like 100 million that you old and you
get like 98 million, you're looking up to 100 million.
You can't go beyond 100 million unless the economy grows.
So there's a limit to how much SARS can improve to raise revenue.
The second thing is, of course, the commodity boom helping us out as well.
And again, that's temporary.
So until we see the underlying economy improve dramatically, I'm a bit worried
about it.
But this budget was, I think, reasonably good,
even in terms of what actually improved by as much as they did.
Very good.
Before I get to the numbers, David, just a quick one on Discovery, please.
Share price up 8.5% today.
What are they doing right?
Did you have a chance to glance at the headline of that one?
Well, the headlines are in the UK.
They seem to be making a lot of headway in the UK, and that's growing.
And the other one was the bank, a turnaround in the bank.
I like to go through those numbers in great detail.
Again, I haven't had a chance to do that.
Simply because of the seven-hour difference that we have.
But I always like to do that.
I like to do it with process and NASPERS.
And this is another one where you actually break down the visions and you see what's
actually contributing to the bottom
line.
So one's got to understand that.
But the market likes it.
I mean, the share price has done incredibly well.
There is progress.
I can't deny that.
But, you know, what kind of progress is, that's what we've got to analyze.
But I see the market up around about 8%.
Lindsay, we're in a situation where I think the market wants
I looked at Nedbank as well up this morning at 8%.
And I looked at their trading update, which was awful.
And the reason was that there was clarity on the sale of this bank in West Africa.
You know, I don't know what was opaque before.
I don't know what the...
worries were ahead of it.
But anyway, some uncertainties have been removed.
And I mean, they made a huge loss on the actual sale.
But, you know, we always hide those.
We don't show those in headline numbers.
It's always in the earnings.
And yet the share price was up around about 8%.
So I think the market's looking for, you know, reasons to come in.
I tell you where I was disappointed yesterday.
And I looked at that budget.
There was a lot.
that I liked, and I'm hoping that they can actually reduce the amount that they have
to raise, you know,
to finance the whole economy and the normal stories.
But the market didn't respond well.
The bond market did, though.
The bond market did.
Yeah, but the equity, I thought there'd be more on the equity market.
In fact, there were more losers on the market yesterday than there were winners.
And I thought, hold on, that's what, you know, what's it telling us is that, okay.
You know, down at the bottom, this is all very well at that level, but down at the
bottom, things are not that great.
There's still a lot of work to be done.
There's a bit of an improvement today, but I still think there are things, there are
issues that are worrying.
And I'm coming back to where we are, Lindsay, you know, in the clothing
retailers and those areas.
And there's still concerns it's not going to work.
You know, that it's not as easy as perhaps we thought it would be.
Yeah, I had that same conversation yesterday.
The person I was speaking to, actually, you know him, Skulk Lowe.
He was jumping through hoops because of the resources index, which is up about 5%.
And I said, well,
how did the domestic stocks perform given the good budget?
He said they did nothing.
If anything, they were down.
And he was also a little bit puzzled by that.
Anyway.
The dollar round is 15.97, which is, yeah, it's not significantly worse off, but it's
worse off.
The dollar has gained 0.7 against the round.
British pound against the round, 21.59.
And the euro round, 18.84, with the euro dollar around about 1.1810.
The gold price is 51.55.
That's quite a fall from this time yesterday, but on the last 24 hours, only
down $15 or 0.3%.
Platinum price is getting hit.
to the tune of 4.5% to 2,227.
Palladium down 2.9%.
Palladium was a stonking goodbye yesterday, up around about 10%, I think,
at one stage.
But anyway, today down 3%, nearly at 17.82.
If we go now to oil, which will be in sharp focus in the next week or so,
just before Trump presses the button, as soon as the Gerald Ford is in position.
I think it's almost arrived in the Gulf and it'll be alongside the Abraham Lincoln
and then the fun will start.
So Brent crude oil is up 0.6% today, $71.25 per barrel.
$65.51 is the West Texas crude price, up very slightly.
Copper, $5.94, which is down 0.8%.
Well, $6.04 earlier on.
So there's been a bit of a turnaround in the metals in the last three or four hours
or so.
South African 10-year bond, 7.88.
It was 7.80 on the close yesterday.
So it's 8.5 points up or 1%.
That's the yield.
U.S.
10-year, gosh, it's looking to break down through four.
I was certain this was going to be a loser this year, the bond market.
And indeed, I was right.
It went from 4 to 4.30 and now back to 4 again.
So something's going on there.
I thought people would be dumping US Treasuries.
Not so.
S&P 500 futures down three quarters of a percent.
Has there been some numbers out this afternoon, David?
Not that I know of.
The dollar is firmer.
I can see that the Rands at like 1594 having been down in 1580s and that.
But nothing making headlines.
OK, maybe it's just the tech.
Maybe it's the Nvidia thing and it's spilling over into other markets as
they're also linked these days.
6903 now, the S&P 500 down 0.8 percent.
And finally, Bitcoin.
Yeah, it didn't last.
It doesn't like 68,000.
in a range of sort of 62 to 68 at the moment, 67,000 and a bit right now.
If you look at the JSC, we're going to look at the ups and downs.
We've mentioned Truos. I'm sure they're there.
Sorry, I'm just changing my screen.
And we have on the upside, NEDCOR mentioned by David Shapiro up just over
8%.
Discovery up seven and two thirds.
Alphamin up 5%.
HCI up nearly 5%.
Motus, their numbers came out earlier yesterday, I think it was.
4.75% higher.
On the downside, Sassl, a big tumble,
despite the fact that the Rand is weaker and the oil price is higher.
So work that one out.
Sassl down 8.5%.
Tiger Brands down 6.2%.
DRD Gold down 5%.
And Carew down nearly 4%.
To end this, David, I want you to tell us about the State of the Uni.
Were you there?
Did you watch it?
What was the reaction on the streets of New York?
You have no idea.
I mean, to be honest, this is a nation that is so divided.
You've got, you know, it's almost as though you're stuck in the middle of the
road and on the left hand side, you've got these Republicans calling for, or sorry,
let's call it the Democrats on the right hand side, the Republicans. And you're in
the middle saying, which side do I go to?
Because I think they hate it by, but the middle hates both sides and not quite sure
where to go.
It is such an extreme nation, the hate.
and the insults at each other.
And Trump, I decided to try and listen to it, and I started at 9 o'clock here.
By 10 past 9, I was exhausted.
And it went on.
It went on for two hours.
Hour and 47 minutes, longest ever.
Bumbling and just talking and insulting.
And I mean, I don't know where the president gets these numbers from.
He makes them up on the trot.
Yes, he does.
Because nothing is true.
And that's all that's been happening.
The last couple of days, people breaking down these numbers, you know, which were
complete fabrications.
And, you know, claiming, you know,
what he claims for the success on the market is all he's doing and so on.
But anyway, this is the nation.
It's not the kind of nation that you thought, you know, that those pictures
that you used to see in the 50s and 60s and 70s.
It's just a country totally divided.
And Democrats...
Many never turned up, Lindsay, and a lot walked out.
And when they asked, did you hear that there was a huge outcry when he asked
everybody to stand up, you know, and applaud
Medal of Honor and so on and so on and whatever.
And the Democrats never stood up.
So there was huge issues against that as well.
I've been watching it with fascination.
Viv, you're an analytical person.
You listen to David and I indulgently talking about...
the personal defects of the president because it doesn't matter does it clearly
no it does to some extent because he's such
a volatile figure i mean uh you know you could have a clinton or you could have
whatever in office at the moment and you'd have a much clearer idea as to
what's happening with iran but literally it's not breaks tomorrow and iran could be
a country or not a country because of
what he thinks of in the morning you know what i mean uh there's a great uh john
oliver
thing where he basically goes through and talks about how things that can appear on
twitter often from accounts that are very dubious,
can suddenly translate into real impacts on the world because it gets picked up by
Elon Musk, it goes off to Trump,
and Trump suddenly is moving policy in weird ways.
So, I mean, this is the world we're living in.
But what gets me is that how stupid were the Democrats?
I mean, by sitting down, not for Trump, but for the Medal of Honor people,
it was just dumb because he chose people that anyone would say, these are American
heroes, you stand up for them.
You know what I mean?
And by not doing it, it was just dumb.
It was a difficult one because of the association with Trump, because Trump
introduced the theme.
You see, that's the point.
I understand why they didn't stand up, but they should have bitten their tongues and
stood up for America.
So, yes, you're quite right.
They did make a mistake.
Gentlemen, got a dash.
Thank you very much for your time this evening.
David Shapiro is from SAS for Insecurities in Manhattan.
David, sorry, Viv Govender is from Ransuisse in Johannesburg.
And that was the five o'clock shadow.
The views and opinions expressed in these podcasts are those of Lindsay Williams and
various contributors and do not reflect the policy,
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employer or company associated with StrictlyBusinessPodcast.com.
Assumptions made on the analyses are not reflective of the position of any other
entity other than the speaker or the author.
And since we are critically thinking human beings, these views are always subject to
change, revision, and revision.
and rethinking at any time.
Please do not hold us to them in perpetuity.