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The Latest Daily PodCast can be found here on the Front Page of the site
http://www.rich.co.ke

Mon, 12 Jan 2015 07:41:51 GMT @CNBCAfrica Interview @NSEKenya Video
http://www.cnbcafrica.com/video/?bctid=3983513189001

I thank His Excellency @BobGodec for the Invite yesterday to his
#Tweet4Elephants Event

It was viral, it was fascinating and we even had time to dance to a
song composed by Juliani and Emmauel Jal and others.

Macro Thoughts

Home Thoughts

Turkey's Recep Tayyip Erdogan, right, received Palestinian
President Mahmoud Abbas, left, after passing between two columns of 16
troops, each dressed in the warrior regalia of past Turkic states,
bearing period armour and toting weapons ranging from swords to
lancers.
http://www.bloomberg.com/news/2015-01-12/erdogan-revives-memories-of-turkic-empires-in-new-state-ceremony.html

    Turning and turning in the widening gyre
    The falcon cannot hear the falconer;
    Things fall apart; the centre cannot hold;
    Mere anarchy is loosed upon the world,
    The blood-dimmed tide is loosed, and everywhere
    The ceremony of innocence is drowned;
    The best lack all conviction, while the worst
    Are full of passionate intensity.

The global development lender predicted the global economy would grow
3 percent this year, below a forecast of 3.4 percent made in June,
according to its twice-yearly Global Economic Prospects report.

Global Economic Prospects to Improve in 2015, But Divergent Trends
Pose Downside Risks, Says WB @Worldbank
http://www.worldbank.org/en/news/press-release/2015/01/13/global-economic-prospects-improve-2015-divergent-trends-pose-downside-risks

World Bank Group's Global Economic Prospects (GEP) report, released today.

After growing by an estimated 2.6 percent in 2014, the global economy
is projected to expand by 3 percent this year, 3.3 percent in 2016 and
3.2 percent in 2017 [1], predicts the Bank's twice-yearly flagship.
Developing countries grew by 4.4 percent in 2014 and are expected to
edge up to 4.8 percent in 2015, strengthening to 5.3 and 5.4 percent
in 2016 and 2017, respectively.

Risks to the outlook remain tilted to the downside, due to four
factors. First is persistently weak global trade. Second is the
possibility of financial market volatility as interest rates in major
economies rise on varying timelines. Third is the extent to which low
oil prices strain balance sheets in oil-producing countries. Fourth is
the risk of a prolonged period of stagnation or deflation in the Euro
Area or Japan.

"Risks to the global economy are considerable. Countries with
relatively more credible policy frameworks and reform-oriented
governments will be in a better position to navigate the challenges of
2015," concluded Franziska Ohnsorge, Lead Author of the report.

In Sub-Saharan Africa, growth picked up only moderately in 2014 to 4.5
percent, reflecting a slowdown in several of the region's large
economies, notably South Africa. Growth is expected to remain flat in
2015 at 4.6 percent (lower than previously expected), largely due to
softer commodity prices, and rise gradually to 5.1 percent by 2017,
supported by infrastructure investment, increased agriculture
production, and buoyant services. The outlook is subject to
significant downside risks arising from a renewed spread of the Ebola
epidemic, violent insurgencies, lower commodity prices, and volatile
global financial conditions. Policy priorities include a need for
budget restraint for some countries in the region and a shift of
spending to increasingly productive ends, as infrastructure
constraints are acute. Project selection and management could be
improved with greater transparency and accountability in the use of
public resources.

Euro 1.1791 reached a December 2005 low of  $1.1753.
Dollar Index 92.13
Japan Yen 117.15
Swiss Franc 1.0185
Pound 1.5159 where inflation halved to just 0.5 percent in December,
the lowest in over 14 years.
Aussie 0.8089
India Rupee 62.125
South Korea Won 1081.52
Brazil Real 2.6422
Egypt Pound 7.1489
South Africa Rand 11.5630

The Federal Reserve has stopped printing dollars and I think the Fed
is just one headline economic print from raising interest rates. A
rate hike, even as small as 0.25 per cent, will be the catalyst for a
renewed surge in the dollar. The Dollar Index is headed a lot higher -
buy the dollar.

So far this week, Brent has lost 7 percent and U.S. crude 5 percent.
On Wednesday, Brent gave up early gains and fell another 40 cents to
$46.19 per barrel, while U.S. crude shed 46 cents to $45.43.

The oil warfare specialist, US President Barack Obama, has
successfully wrestled crude price to below $50 a barrel, and with that
effected a choke- hold on Vladimir Putin's Russia, Venezuela and
others as far afield as Nigeria and Angola. The Nigeria All-Share
Index is down 13 per cent in 2015, and the worst performing equity
index in the world.

I do not see a near-term bounce in the oil price. I think it could
average $50 a barrel for the next 24 months. There is no 'Hail-Mary'
pass coming that I can see for the oil producers and it's going to
stay very Darwinian. Oil supply is not reducing as prices implode,
it's actually increasing as producers try to make up for some of the
shortfall by selling more barrels.

Crude Oil March 2015 1 Year Chart INO 45.90
http://quotes.ino.com/charting/index.html?s=NYMEX_CL.H15.E&v=d12&t=c&a=50&w=1

Gold 6 month INO 1227.19
http://quotes.ino.com/charting/index.html?s=FOREX_XAUUSDO&t=c&a=50&w=1&v=d6

Since gold does not pay a return, an opportunity cost for holding it
is the yield forgone on safe-haven bonds. Now, that cost has
diminished to the point where buying gold offers the same return as
lending money to Germany for five years.

The yellow metal was was a shade softer at $1,230.00 an ounce on
Wednesday after touching a three-month peak.

Copper suffers meltdown @Reuters [Big Issue for Zambia]
http://www.reuters.com/article/2015/01/14/us-markets-global-idUSKBN0KM01O20150114

copper futures dived 6.2 percent to $5,499 a tonne when major chart
support cracked and triggered a host of stop-loss sales.

The metal is often considered a barometer of industrial demand, so the
slump leant extra gravitas to news the World Bank had cut its 2015
growth forecasts blaming sluggishness in the euro zone, Japan and some
major emerging economies. [TOP/CEN]

"The global economy is at a disconcerting juncture," World Bank chief
economist Kaushik Basu told reporters. "It is as challenging a moment
as it gets for economic forecasting."

Emerging Markets

Frontier Markets

Growth picked up moderately in Sub-Saharan Africa in 2014, to an
average of about 4.5 percent compared with 4.2 percent in 2013. GDP
growth slowed markedly in South Africa, constrained by strikes in the
mining sector, electricity shortages, and low investor confidence.

Growth was also strong in many of the region's low-income countries,
including Côte d'Ivoire, Mozambique, and Tanzania. Excluding South
Africa, the average growth for the rest of the region was 5.6 percent.
This is a faster pace than other developing regions, excluding China

Regional GDP growth is projected to remain steady at 4.6 percent in
2015 and rise gradually to 5.1 percent in 2017 (Table 2.11), supported
by sustained infrastructure investment, increased agricultural
production, and expanding service sectors. Commodity prices and
capital inflows are expected to provide less support, with demand and
economic activity in emerging markets remaining subdued. FDI flows are
projected to remain flat in 2015 and sovereign bond issuance will slow
as global financial conditions gradually tighten. Sub-Saharan Africa
would nevertheless remain one of the fastest growing regions.

The risks to the region's outlook are mostly on the downside, stemming
from both external and domestic factors. A range of idiosyncratic
risks includes the Ebola epidemic, expansionary fiscal policy and
currency weaknesses, and the precarious security situation in a number
of countries. A sudden increase in volatility in international
financial markets, and lower growth in export markets are among the
major external risks to the region's outlook

Economic growth slowed to a standstill after the coup and the World
Bank last year estimated nine out of every 10 people in the country of
22 million lives on less than $2 a day as cuts to budgetary aid forced
the government to reduce services. The crisis cost the economy, which
relies on mainly tourism, agriculture, and mining, at least $8 billion
in lost output, according to the bank.

49,433.00 +964.61 +1.99%

Egypt Pound versus The Dollar 3 Month Chart INO 7.1478
http://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&v=d3&t=c&a=50&w=1

Egypt EGX30 Bloomberg +4.32% 2015
http://www.bloomberg.com/quote/CASE:IND

9,308.98 +199.75 +2.19%

Last month 13-year-old Zaharau Babangida refused to set off explosives
she was carrying after being sent by her father to camps run by the
Nigerian Islamist militant group Boko Haram.

Babangida was arrested by police on Dec. 10 after two other female
bombers killed at least six people at a textile market in northern
Nigeria's largest city Kano. She agreed to travel from Bauchi to Kano
after the militants "pointed at a ditch and told me that I am going to
be killed there" if she refused.

"The members asked me if I wanted to commit a suicide bombing and that
if I did I will enter paradise," said Babangida, who was wearing the
flowing religious garment that covers the body from head to feet,
known as the hijab, as she was paraded in front of reporters on Dec.
24.

Young girls are being increasingly coerced into suicide attacks in the
predominately Muslim north as Boko Haram evolves tactics in its
six-year campaign to bring Islamist rule to Africa's largest economy.
In the past week, a girl as young as 10 set off explosives at a market
in the northeastern city of Maiduguri killing at least 20.

Two others detonated bombs near a mobile-phone market in the town of
Potiskum, killing at least seven and injuring 48 people, Yobe state
Governor Ibrahim Gaidam said in e-mailed statement sent by his office.

"Boko Haram relies upon women and children to carry out suicide
bombings because they can easily and effectively infiltrate crowded
urban environments and bypass security checkpoints without arousing
suspicion," said Malte Liewerscheidt, senior Africa analyst at Bath,
England-based risk consultancy Verisk Maplecroft. "It highlights the
ability of Boko Haram to access, indoctrinate and utilize all elements
of society."

Nigeria, home to Africa's biggest oil industry and population, is
heading toward general elections next month in the face of worsening
violence in the north. Both President Goodluck Jonathan, 57, and main
opposition candidate and former military ruler Muhammadu Buhari, 72,
have pledged to stop the insurgency, which has killed more than 13,000
people since 2009, according to the government.

"It is very shocking for someone to take a child that they bore as her
biological father and recruit her to commit suicide," said Muhammad
Faruk, a 33-year-old bus driver and resident of Potiskum. "The
question is: where do they get them?"

Boko Haram, whose name roughly translates to "Western education is a
sin," has stepped up kidnappings since it seized more than 200
schoolgirls from the northeastern town of Chibok in April, drawing
international condemnation.

Another 191 people were abducted last month in the remote village of
Gumsuri, the group's largest mass kidnapping since Chibok. Many of the
girls have probably been brainwashed by the militants into committing
the attacks, Bawa Abdullahi Wase, a security analyst and associate at
the Network for Justice, said by phone from the capital, Abuja.

"The reported youthfulness of several of the purported suicide bombers
suggests that they were selected from Boko Haram's pool of kidnap
victims and coerced into carrying out the above mentioned attacks,"
Poole, U.K.-based security consultancy Drum Cussac said in an e-mailed
report. The bombings in Maiduguri and Potiskum "underscored the
militants' sustained intent and capacity to cause a maximum of
civilian casualties in terrorist attacks," it said.

Reports that as many as 2,000 people died in attacks last week on the
northeastern town of Baga are unfounded, Nigeria's military said
yesterday. Initial evidence, including aerial surveillance, shows the
death toll didn't exceed 150, according to the nation's Defence
Headquarters.

"The proliferation of violence in the pre-election period is leaving
the Nigerian security forces spread too thin," said Liewerscheidt.
"There is little doubt that the government and the military have
effectively lost control over large swathes of northeast Nigeria."

Last year, Ben Bernanke was asked why people hold gold and he said:
"As protection against what we call tail risks: really, really bad
outcomes."

The insurgency tail risk remains and how it plays out will have
important consequence for ourselves and the entire Africarising
narrative.

Security conditions remain difficult, in some areas threat- ening
spill-over effects. The IMF has focused on the dreadful situation in
South Sudan and in Central African Republic, but I would also raise
the red flag around the risks posed by the likes of al-Shabaab and the
Boko Haram whose leader Abubakar Shekar taunted President Goodluck
Jonathan with the comment ''I am in your city.''

Nigeria Central Bank Loosens Rules for Trading Slumping Currency
http://www.bloomberg.com/news/2015-01-13/nigeria-central-bank-loosens-rules-for-trading-slumping-currency.html

Nigeria's central bank loosened rules for buying and selling the
weakening naira that were implemented last month and blamed for
crushing foreign-currency trading in Africa's largest economy.

The maximum net open foreign-exchange trading positions banks can hold
at the end of each business day was increased to 0.1 percent from
zero, the Central Bank of Nigeria, based in the capital, Abuja, said
in a notice on its website dated yesterday. Banks have 72 hours to use
dollars bought in the interbank market before they must sell them back
to the institution, up from 48 hours previously, it said.

Nigeria, which produces the most oil of any African country, tightened
rules on foreign-currency trading as the naira slumped and crude
prices plunged. The central bank raised interest rates to a record 13
percent in November to stem outflows and Finance Minister Ngozi
Okonjo-Iweala proposed cutting this year's budget by 8 percent.
Interbank trading dried up last month after the bank introduced the
tighter rules.

The revision won't lead to "a significant change in market liquidity,"
analysts at Zenith Bank U.K. Ltd. said in a note to clients.

The naira weakened as much as 1.8 percent before paring the decline to
trade 0.4 percent lower at 182 per dollar by 10:44 a.m. in Lagos, the
commercial capital. While the currency is up 0.8 percent this year, it
fell 10 percent in the past three months, the most among 24 African
currencies tracked by Bloomberg. Brent crude has fallen almost 60
percent since June to $45.72 a barrel today.

The regulator reduced the daily foreign-exchange positions for banks
from 1 percent of shareholders' funds in December to stop speculation
against the naira, Governor Godwin Emefiele said on Jan. 6.

Conclusions

Its a False Market and I still believe in what I tweeted 19th November 2014

Ghana Stock Exchange Composite Index Bloomberg -0.05% 2015
http://www.bloomberg.com/quote/GGSECI:IND

Banks in Zimbabwe Cut 1,000 Jobs Last Year, Union Says [As good a Signal as any]
http://www.bloomberg.com/news/2015-01-13/banks-in-zimbabwe-cut-1-000-jobs-last-year-union-says.html?hootPostID=6aa0e5477c97923904c20d392279075b

Banks in Zimbabwe cut 1,000 jobs last year, eliminating one post out
of every six in the southern African country's banking industry, a
union official said.

Oil companies across the globe are grappling with a drastic drop in
oil prices that has hit earnings, putting firms under pressure to cut
costs elsewhere.

"Tullow will be a smaller company," the source said.

London-listed Tullow Oil employs more than 2,000 people across 22
countries, with its African operations accounting for half the total
workforce.

Tullow Oil has cut its capital expenditure plans for this year to $300
million, down from $1 billion invested in the first half of 2014
alone.

My concern at this moment is this: We are necessarily placing a big
bet on oil and gas and cementing our position as the pivot (the energy
conduit and route to the sea] state for this region. Now go take a
look at the price of oil. Its been slammed from above a $100 a barrel
to below $80. There is an outside chance that we can break down to $50
a barrel. The share prices of the oil companies (Tullow Oil is down
45.84 per cent since the start of the year and Africa Oil is negative
60.67 per cent over the same period) have cratered. The markets are
signaling loud and clear that the economics have changed and how. Both
Tullow Oil and Africa Oil are exploration companies. They find the oil
and then they typically go and find a big major with deep pockets to
exploit the oil. It is imperative that we see the majors step in,
otherwise the can will get kicked down the road.

The consequential effects on our economy of the can being kicked down
the road are not good, not good at all.

Kenya Shilling versus The Dollar Live ForexPros 91.397
http://j.mp/5jDOot

Nairobi All Share Bloomberg +1.15% 2015
http://www.BLOOMBERG.COM/quote/NSEASI:IND

164.76 +2.71 +1.67%

5,138.07 +16.08 +0.31%

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

People living near Lake Turkana in northern Kenya have little
understanding that the fresh water essential to their development is
likely to dry up when a huge hydoelectric dam in neighbouring Ethiopia
is completed.

Fishermen, farmers, teachers and others living near the world's
largest desert lake say Turkana's volume has reduced significantly
over the past 30 years because of higher temperatures and changing
weather patterns.

But few of the 100 people interviewed by a Kenyan researcher for
International Rivers watchdog said they had been consulted or warned
what could happen when the reservoir of the Gibe III dam, one of
Africa's largest hydropower projects, is completely filled in about
three years' time. The $1.8bn construction project, which is 90%
complete, will start limited power generation in June.

The downstream impact of the dam is hotly contested. Some hydrologists
have predicted that Ethiopia's expansion of water-intensive sugar and
cotton plantations on the Omo river, which the Gibe 111 dam allows,
could reduce flow to Lake Turkana by up to 70%. This would kill
ecosystems and greatly reduce the water level of the lake.

When told of the possible impact of the project, ethnic groups and
communities near the lake predicted widespread conflict, hunger and
cultural devastation. "If the Gibe III dam is constructed, the lake
will dry up and this will lead to desertification and there will be
depletion of resources: there will be no fish, no farming, and low
humidity [and less rain]. If that is the case, the community will be
finished," said Sylvester Ekariman, chairman of the council of elders
in Kakalel pastoral village.

The Price of Super petrol was slashed by Ksh 9.13/ litre effective
midnight and this is an important move and will surely constitute a
much need ''Adrenaline'' shot in the Economy's arm.
The Nairobi All Share rallied a further 0.8011% to close at 166.08 and
making that a powerful +2.486% two day rally.
The All Share is within 0.416% and spitting distance of a All Time
High reached 9th December 2014.
The Nairobi NSE20 surged 55.86 points higher to close at 5,193.93
which is a 2 and a half month closing High.
Turnover clocked 514.335m and picked up some speed from 310.114m last time.
I venture that Local Sellers turned defensive in January limiting Sell
Side Supply and Money has come into Frontier funds which has had to be
put to work.
The Market has grabbed the Baton this week and been running with it.
There were 2 Winners for every Loser at the Securities Exchange today.

Safaricom firmed a further +1.0204% to close at 14.85 making that a
powerful 2 session Rally of 7.222% and to within just 1.00% of a
record closing High of 15.00 reached Dec 9th 2014. Safaricom was the
most actively traded share at the Securities Exchange and traded
10.804m shares worth 160.895m. Safaricom is +5.69% in January. The
Chart Pattern remains a classic bull Pattern. A New record high is a
Racing Certainty.

Kenya Airways [which has very much lagged a World-wide Airline stock
Rally as Investors anticipated a much lower Fuel Bill Profile for
Airlines] rallied +3.333% to close at 9.30 and was trading at 9.55
+6.11% and just below session highs at the Finish Line. The @BD_Africa
carried a story this morning that Kenya Airways was looking to offload
some land at Embakasi and Buyers today saw that as a positive
development.

ScanGroup rebounded 6.86% to close at 46.75 and traded 71,500 shares.

Uchumi firmed 1.90% to close at 10.70 a 16 week high and traded
102,200 shares. Uchumi is +6.46% in January and the price has further
headroom after a very steep Sell-Off in front of what was eventually
an oversubscribed Rights Issue.

Kenya Commercial Bank surged +2.61% to close at 59.00 and on strong
volume of 1.727m shares worth 102.677m. Kenya Commercial Bank has
rallied +3.508% in January and is within 1.666% within a record
closing High of 60.00 reached End September 2014. Kenya Commercial
Bank displayed a great deal of price alpha in 2014. A New Record High
is a Shoe-In.
Equity Bank firmed +1.5075% to close at 50.50 and traded 1.267m shares
worth 64.519m. Equity Bank has firmed 1.00% in January.
Buyers stepped up to defend 19.00 and lifted COOP Bank 0.26% to close
at 19.05 and traded 1.080m shares.

Centum spiked +5.34% higher to close at 69.00 and traded 547,200
shares worth 37.992m. Centum [which was a little oversold into year
End on some big ticket bed and breakfast trades] has now rallied
13.11% in 2015. Recent Positive Price Catalysts were the news around
UAP where Centum was bagging a meaningful gain [and confirming that
they are not scared to book a Profit] and the apparent green lighting
of the Coal Project.

Mumias Sugar surged a further 8% to close at 2.70 and traded 4.658m
shares. Mumias Sugar has rallied a parabolic +42.105%  in 2015 as
Investors price GOK Support back in to the Equation having priced it
out last year, post some supportive and emollient comments from the
Cabinet Secretary Henry Rotich.

EABL closed unchanged at 305.00 and traded 117,000 shares. EABL will
trade towards 400.00 in 2015 and there is strong Support at 300.00
making this level an optimal Entry Level.

Total Kenya was a strong Feature and closed 5% higher at 26.25 and
traded just 1,600 shares. Total Kenya has surged 9.375% so far this
January.