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Satchu's Rich Wrap-Up
Tuesday 03rd of March 2020

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Macro Thoughts

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As usual, Jay Powell and the Federal Reserve are slow to act. Germany and others are pumping money into their economies @realDonaldTrump

Other Central Banks are much more aggressive. The U.S. should have,
for all of the right reasons, the lowest Rate. We don’t, putting us at

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01-MAR-2020 : "If they can get you asking the wrong questions, they don't have to worry about answers." - Thomas Pynchon, Gravity's Rainbow The Origin of the #CoronaVirus #COVID19

“I dream that I have found us both again,
With spring so many strangers' lives away,
And we, so free,
Out walking by the sea,
With someone else's paper words to say....

They took us at the gates of green return,
Too lost by then to stop, and ask them why-
Do children meet again?
Does any trace remain,
Along the superhighways of July?”
― Thomas Pynchon, Gravity's Rainbow

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A twitter feed is NOT an open public forum. It is private. It is like
your daily newspaper or your personal classroom.  You are free to let
in only qualified students. Otherwise noise will overtake your life.

Political Reflections

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China's Decision to Leave Asymptomatic Patients off Coronavirus Infection Tally Sparks Debate @caixin
Law & Politics

China’s decision to exclude individuals who carry the new coronavirus
but show no symptoms from the country’s public tally of infections has
drawn debate over whether this approach obscures the scope of the
epidemic, with a document received by Caixin showing a significant
proportion of one province’s cases show no symptoms.
Since early February, the National Health Commission (NHC) has
concluded that “asymptomatic infected individuals” can infect others
and demanded local authorities to report those cases. However, the
commission has also decided not to include these people in its
statistics for “confirmed cases” or indeed to release data on
asymptomatic cases.
On Feb. 25, in Northeast China’s Heilongjiang province there were 104
asymptomatic infected individuals, according to a Feb. 26 Heilongjiang
Provincial Center for Disease Control and Prevention document obtained
by Caixin. That same day the province said (link in Chinese) it had
480 “confirmed cases,” a tally which did not include the 104
asymptomatic cases.

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A doctor in Wuhan told me she estimated asyms were as many as 20% of cases. @yindavid
Law & Politics

Data we obtained contrasts with a Feb Chinese Journal of Epidemiology
study that said asyms were less than 2% of patients. In Japan, asym
were 10.2% of total infections last Wed., excl. Diamond Princess. A
doctor in Wuhan told me she estimated asyms were as many as 20% of

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"There is no easy narrative to maintain the illusion of an all-powerful Xi when the country is still [in parts in] lockdown... it appears this virus is more viral than any meme Xi and the CCP can propagate to stop it," Wu'er Kaixi
Law & Politics

“The talk was of decoupling from the Chinese economy before the
outbreak of Covid-19. That talk will [intensify in] the coming months,
even years. This is an event that could – not necessarily will –
change the global economic landscape. China has a lot to lose should
that be the case,” Wu’er Kaixi added.

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In Coronavirus Fight, China Gives Citizens a Color Code, With Red Flags @nytimes @paulmozur
Law & Politics

A new system uses software to dictate quarantines — and appears to
send personal data to police, in a troubling precedent for automated
social control.
HANGZHOU, China — As China encourages people to return to work despite
the coronavirus outbreak, it has begun a bold mass experiment in using
data to regulate citizens’ lives — by requiring them to use software
on their smartphones that dictates whether they should be quarantined
or allowed into subways, malls and other public spaces.
But a New York Times analysis of the software’s code found that the
system does more than decide in real time whether someone poses a
contagion risk.
It also appears to share information with the police, setting a
template for new forms of automated social control that could persist
long after the epidemic subsides.
The Alipay Health Code, as China’s official news media has called the
system, was first introduced in the eastern city of Hangzhou — a
project by the local government with the help of Ant Financial, a
sister company of the e-commerce giant Alibaba.
People in China sign up through Ant’s popular wallet app, Alipay, and
are assigned a color code — green, yellow or red — that indicates
their health status.
The system is already in use in 200 cities and is being rolled out
nationwide, Ant says.
The sharing of personal data with the authorities further erodes the
thin line separating China’s tech titans from the Communist Party
The Times’s analysis found that as soon as a user grants the software
access to personal data, a piece of the program labeled
reportInfoAndLocationToPolice” sends the person’s location, city name
and an identifying code number to a server.
The software does not make clear to users its connection to the
police. But according to China’s state-run Xinhua news agency and an
official police social media account, law enforcement authorities were
a crucial partner in the system’s development.
Neither the company nor Chinese officials have explained in detail how
the system classifies people.
That has caused fear and bewilderment among those who are ordered to
isolate themselves and have no idea why.
While Chinese internet companies often share data with the government,
the process is rarely so direct. In the United States, it would be
akin to the Centers for Disease Control and Prevention using apps from
Amazon and Facebook to track the coronavirus, then quietly sharing
user information with the local sheriff’s office.
Zhou Jiangyong, Hangzhou’s Communist Party secretary, recently called
the health code system “an important practice in Hangzhou’s digitally
empowered city management” and said the city should look to expand the
use of such tools, according to state news media.
Such surveillance creep would have historical precedent, said Maya
Wang, a China researcher for Human Rights Watch.
China has a record of using major events, including the 2008 Beijing
Olympics and the 2010 World Expo in Shanghai, to introduce new
monitoring tools that outlast their original purpose, Ms. Wang said.
“The coronavirus outbreak is proving to be one of those landmarks in
the history of the spread of mass surveillance in China,” she said.
In a statement, Ant Financial’s general counsel, Leiming Chen, said
that Ant required all third-party developers, including those offering
health code services, to adhere to its data security and privacy
requirements, which include obtaining user consent before providing
 “The collaboration between private and public sectors in epidemic
control is a common global practice,” Mr. Chen said.
The early days of the epidemic seemed to expose the limits of
Beijing’s expensive computerized snooping.
Blacklists targeting criminals and dissidents floundered at the task
of monitoring entire populations. Facial recognition proved easily
flummoxed by face masks.
In response, China has stepped up its efforts to ensure, mostly with
the help of old-fashioned human enforcement, that citizens leave
digital footprints wherever they go.
Across the country, workers in train stations and outside residential
buildings record people’s names, national ID numbers, contact
information and details about recent travel.
In some cities, residents now have to register their phone numbers
with an app to take public transportation.
The Alipay Health Code’s creators say it uses big data to draw
automated conclusions about whether someone is a contagion risk.
After users fill in a form on Alipay with personal details, the
software generates a QR code in one of three colors.
A green code enables its holder to move about unrestricted. Someone
with a yellow code may be asked to stay home for seven days. Red means
a two-week quarantine.
In Hangzhou, it has become nearly impossible to get around without
showing your Alipay code. Propaganda-style banners remind everyone of
the rules: “Green code, travel freely. Red or yellow, report
At times during a recent visit, tensions over the code were evident.
Two subway guards said older passengers, annoyed by the phone checks,
had cursed and yelled at them.
When one middle-age man barged through a line, a guard had to run him
down. As she did, others slipped by, their phones unchecked.
In a Feb. 24 news briefing, officials said that more than 50 million
people had signed up for health codes in Zhejiang Province, whose
capital is Hangzhou.
That is almost 90 percent of the province’s population. Of these
codes, 98.2 percent were green, which means nearly a million people
had yellow or red codes.
An official webpage with questions and answers about the service says
a yellow or red code may be given to someone who has had contact with
an infected person, visited a virus hot zone or reported having
symptoms in the sign-up form.
This suggests that the system draws on information about coronavirus
cases and government-held data on plane, train and bus bookings.
Beyond that, however, The Times’s analysis also found that each time a
person’s code is scanned — at a health checkpoint, for instance — his
or her current location appears to be sent to the system’s servers.
This could allow the authorities to track people’s movements over
Ant Financial declined to answer questions about how the system
worked, saying that government departments set the rules and
controlled the data.
Alipay has 900 million users across China. Ant is part-owned by
Alibaba, whose shares trade in New York and are owned by major
international investors.
Tencent, the Chinese internet giant that runs the messaging app
WeChat, which has over a billion monthly users, has also worked with
the authorities to build its own health code system.
Leon Lei, 29, signed up for an Alipay code before leaving his
hometown, Anqing, to return to work in Hangzhou.
At first, his code was green. But a day before he departed, it turned
red, and he didn’t know why. Anqing has not been especially hard hit
by the virus, though it neighbors Hubei Province, the center of the
On the road to Hangzhou, officers at two highway exits saw his digital
scarlet letter and stopped him from taking the exit. Only at a third
exit was he allowed to pass.
“The broad rules aren’t public,” Mr. Lei said. “How it assigns red or
yellow codes isn’t public. And there’s no clear way to make your code
turn green.”
Both Alibaba and Ant Financial have their headquarters in Hangzhou,
and as the system expands nationwide, other places may not enforce it
as stringently.
According to the Xinhua news agency, 100 Chinese cities were using the
system within a week of its introduction in Hangzhou on Feb. 11.
Complaints began flooding social media almost as quickly.
Vanessa Wong, 25, works in Hangzhou but has been stuck for weeks in
her hometown in Hubei Province. She has no symptoms. But her health
code is red, and both her employer and her housing complex in Hangzhou
require people to have a green code to be allowed back.
So far, she has heard nothing from the authorities about when she
might expect her code to change color. Her best guess is that it’s red
simply because she is in Hubei.
Hangzhou officials have acknowledged the unease the system has caused.
At a recent news conference, they urged citizens to report glitches
and inaccuracies to the authorities.
“Even if a yellow code or a red code appears, don’t be nervous,” said
Tu Dongshan, the deputy secretary-general of the city’s Communist
Party committee.
Holed up at home and unable to concentrate on her work, Ms. Wong is
feeling helpless. She cannot help noticing that the system encourages
a kind of regional prejudice.
“It divides people up based on where they’re from,” she said. “Isn’t
that discrimination?
With fear of the virus still acute, many in China take comfort in
high-tech precautions, even if they are at times impractical and
Doo Wang, 26, said her code was red for a day before it inexplicably
changed to green. Calling a support hotline yielded no answers. Yet
she still approves of the system.
“If we had to use it indefinitely, that would be crazy — just way too
big a pain,” Ms. Wang said. “But for the epidemic, it makes sense.”
She shrugged off the privacy concerns. “Alipay already has all our
data. So what are we afraid of? Seriously.”

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07-OCT-2019 :: China turns 70
Law & Politics

Xi Jinping and the party were seeking to project national power and
confidence on a grand scale.
They have “stood up.” Xi’s model is one of technocratic
authoritarianism and a recent addition to his book shelf include The
Master Algorithm by Pedro Domingos.
Xi is building an Algorithmic Society.
But Xi has taken the propagation of ideology and the cult of
personality to extremes not seen since the days of Chairman Mao.
The World in the 21st century exhibits viral, wildfire and exponential
characteristics and feedback loops which only become obvious in hind-

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Pentagon also warned China: "You Don't Want To Play Laser Tag With Us."
Law & Politics

Last year, the US conducted a record-high of nine Freedom FONOPs in
the South China Sea, up from five in 2018 and six in 2017.
In January, the USS Montgomery, an independence-class littoral combat
ship, conducted the first US FONOP of 2020, sailing within a few
nautical miles of the China- claimed Fiery Cross Reef.

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.1466
Dollar Index 97.422
Japan Yen 107.82
Swiss Franc 0.9581
Pound 1.2789
Aussie 0.6543
India Rupee 72.95
South Korea Won 1195.01
Brazil Real 4.474
Egypt Pound 15.67
South Africa Rand 15.48125

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Crude Oil Chart @ElCryptoChief 47.60 [A Dead Cat]

Emerging Markets

Frontier Markets

Sub Saharan Africa

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We spoke to the doctors at the Institue Pasteur who confirm 1st case of coronavirus in Senegal. @nicolashaque

A French national is being treated - there are 3 other suspected
cases- and all those that were with him on the Air Senegal Paris to
Dakar are being quarantined.

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02-MAR-2020 :: The #COVID19 and SSA and the R Word

There are 2 issues with respect to the #Coronavirus.
The First Issue is whether The #CoronaVirus will infect the Continent
We Know that the #Coronavirus is exponential, non linear and multiplicative.
what exponential disease propagation looks like in the real world.
Real world exponential growth looks like nothing, nothing, nothing ...
then cluster, cluster, cluster ... then BOOM!
⁦.@BillGates said. “This disease, when it comes to Africa, will be
more dramatic than in China – and I don't want to play down what is
happening in China.” #COVID19

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At the beginning of the Year These were the forecasts from the AFDB IMF and WORLD BANK .@AfDB_Group African Economic Outlook 2020

Africa’s economic outlook continues to brighten. Its real GDP growth,
estimated at 3.4 percent for 2019, is projected to accelerate to 3.9
percent in 2020 and to 4.1 percent in 2021

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Regional growth is expected to pick up to 2.9% in 2020 @WorldBank Economic Outlook

Risks: A sharper-than-expected deceleration in major trading partners
such as China, the Euro Area, or the United States, would
substantially lower export revenues and investment.
A faster-than-expected slowdown in China would cause a sharp fall in
commodity prices and, given Sub-Saharan Africa’s heavy reliance on
extractive sectors for export and fiscal revenues, weigh heavily on
regional activity.
CHINA will post negative GDP in Q1 2020 and even Q2 2020 [I believe]
Commodity Prices have been crushed

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2-SEP-2019 :: the China EM Frontier Feedback Loop Phenomenon. #COVID19

This Phenomenon was positive for the last two decades but has now
undergone a Trend reversal.
The Fall-out is being experienced as far away as Germany Inc.
The ZAR is the purest proxy for this Phenomenon.
African Countries heavily dependent on China being the main Taker are
also at the bleeding edge of this Phenomenon.
This Pressure Point will not ease soon but will continue to intensify
"a one percentage point decrease in China’s domestic investment growth
is associated with an average 0.6 percentage point decrease in
Africa’s exports"
@MoodysInvSvc downgraded Nigeria to negative and we learnt that
Foreign Investors are propping up the Naira to the tune of NGN5.8
trillion ($16 billion) via short-term certificates.
 Everyone knows how this story ends. When the music stops, everyone
will dash for the Exit and the currency will collapse just like its
collapsing in Lusaka as we speak.

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The @MoodysInvSvc downgrade in two graphs @nonso2

Balance Sheets are maxed out
Debt burdens have increased and affordability has weakened across most
of Sub-Saharan Africa, while a shift in debt structures has left some
countries more exposed to a financial shock #MoodysAfrica
And on top of all this we have a Locust Invasion

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Foreign Lenders Are Making a Killing From Africa, @AfDB_Group Says @economics

African governments need to be tougher when negotiating the terms of
Eurobonds and commercial loans, the African Development Bank said.
Some external debts mature before the infrastructure projects they
fund start generating returns, which raises refinancing risks, the
president of the development-finance lender warned.
Neither should African borrowers be “price takers,” he said.
“The short-term maturity of some of these debts do not match the
long-term revenue streams,” Akinwumi Adesina said in an interview in
“You are going to have to pay back when you are not earning the money.
These bonds are oversubscribed because people see opportunities to
make a killing.”
Governments have increased their issuance of dollar and euro bonds in
recent years as loose monetary conditions in developed nations push
global investors to buy higher-yielding assets, not least those in
emerging markets.
Africa’s sovereign issuance in the two currencies totaled $53 billion
in 2018 and 2019, according to data compiled by Bloomberg. Egypt,
Angola, South Africa and Nigeria were the most prolific borrowers in
that period.
This year, Angola, Gabon and Ghana have tapped the Eurobond market.
Ghana got around $15 billion of orders for a $3 billion deal last
Investors have been richly rewarded for buying African sovereign
dollar debt. It generated a total return of 21% in 2019, more than any
other region in emerging markets.
Public debt in sub-Saharan Africa has doubled to 50% of gross domestic
product since 2008, the International Monetary Fund estimates.
Kenya raised its debt ceiling last year and the IMF said the
government should be more cautious in building credit.
In South Africa, authorities see debt spiking to 78% of GDP by 2028,
from just above 60%.
And while Nigeria’s debt is low as a proportion of GDP, the government
spends more than half its revenue servicing it, according to the IMF.
Rising debt-service ratios are “increasingly problematic,” Razia Khan,
Standard Chartered Plc’s chief economist for the Middle East and
Africa, said in a tweet Sunday.
Still, Adesina said Africa isn’t facing a debt crisis.
“Debt is not a problem, it’s very bad debt that’s a problem,” the AfDB
president said. “You have got to worry about the terms of those
Eurobonds, the short term nature and the repayment risk when they are
Some African borrowers have lengthened the maturity of their bonds.
Ghana’s deal included a 40-year tranche, the longest yet from
sub-Saharan Africa.

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H.E. President Felix Tshisekedi at #AIPAC2020 in Washington. #DRC will appoint ambassador to #Israel, open an office in #Jerusalem will make official visit & calls for "strong support" of @realDonaldTrump's peace plan @DrJPPham

H.E. President Félix Tshisekedi at #AIPAC2020 in Washington. #DRC will
appoint ambassador to #Israel, open an office in #Jerusalem;
@Presidence_RDC will make official visit & calls for "strong support"
of  @realDonaldTrump's peace plan

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Egypt Pound versus The Dollar 3 Month Chart INO 15.65

Egypt EGX30 Bloomberg -11.97% 2020

Nigeria All Share Bloomberg -3.82% 2020

Ghana Stock Exchange Composite Index Bloomberg -3.09% 2020


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02-MAR-2020 :: The #COVID19 and SSA and the R Word

We Know that the #Coronavirus is exponential, non linear and multiplicative.
what exponential disease propagation looks like in the real world.
Real world exponential growth looks like nothing, nothing, nothing …
then cluster, cluster, cluster … then BOOM!

read more

.@StanbicKE reports FY 2019 EPS +1.637% Earnings

Par Value:                  5/-
Closing Price:           112.00
Total Shares Issued:          395321638.00
Market Capitalization:        44,276,023,456
EPS:             16.14
PE:               6.939

The Kenyan Banc assurance model includes CFC Bank, CFC Financial
Services and Heritage Assurance.

Stanbic Holdings PLC FY 2019 results through 31st December 2019 vs.
31st December 2018
FY Financial investments 70.077921b vs. 72.260408b -3.020%
FY Loans and advances to banks and customers 191.194571b vs. 174.984710b +9.264%
FY Total assets 303.624592b vs. 290.570254b +4.493%
FY Deposits from banks and customers 224.672913b vs. 219.493914b +2.360%
FY Other liabilities and accrued expenses 14.725225b vs. 6.426698b +129.126%
FY Total Equity 49.034765b vs. 44.623420b +9.886%
FY Net interest income 13.347740b vs. 12.129645b +10.042%
FY Non-interest revenue 11.433073b vs. 9.964720b +14.736%
FY Total income 24.780813b vs. 22.094365b +12.159%
FY Credit impairment charges [3.150559b] vs. [2.064462b] +52.609%
FY Income after impairment charges 21.630254b vs. 20.029903b +7.990%
FY Total operating expenses [13.920490b] vs. [11.082146b] +25.612%
FY PBT 7.709764b vs. 8.947757b -13.836%
FY Income tax expense [1.329148b] vs. [2.670591b] -50.230%
FY Profit for the year 6.380616b vs. 6.277166b +1.648%
Basic and Diluted EPS 16.14 vs. 15.88 +1.637%
Dividend per share 7.05 vs. 5.80 +21.552%
Cash and cash equivalents at 31st December 85.210690b vs. 61.040397b +39.597%

via Kestrel

Net interest income increased by 10.0% y/y to KES 13.3bn, mainly on
the back of strong loan growth, 9.3% y/y. Noteworthy, overall loan
book growth was mainly driven by the Personal and Business Banking
(PBB) segment, which recorded a 14.5% y/y growth. The segment also saw
an improvement in NIMs despite the 50bps policy rate cut at the end of
the year, on the back of reduced cost of funds due to growth in local
currency current accounts.
 ü  OpEx (excl. loan loss provisions) increased by 25.6% y/y to KES
13.9bn. As a result, the cost-to-income ratio increased by 6.0% y/y to
56.2%. The key driver of the uptick in OpEx was a c. KES 1.5bn one-off
guarantee payment towards the end of FY19.
 ü  Loan loss provisions increased by 52.6% y/y to KES 3.2bn. As a
result, cost of risk increased by 60bps y/y to 2.0%. Noteworthy, the
uptick in the cost of risk was primarily driven by the Corporate and
Investment Banking (CIB) segment which saw a 110bps y/y increase in
cost of risk.
 ü  Gross NPLs increased by 16.2% y/y to KES 19.2bn. As a result, the
NPL ratio increased by 100bps y/y to 11.2%.
 ü  Noteworthy, NPL coverage (including general provisions and
interest in suspense) increased by 3.7% y/y to 57.1%.


Solid Franchise.
Solid results.

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by Aly Khan Satchu (www.rich.co.ke)
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March 2020

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