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I think we spent almost all of our time worrying about risk at the bottom so we worry about operational risk we wake up in the morning and we are worrying about the Manco or the exco or the fourth decimal place on some financial statement yet I would venture that the biggest risk we face is the macro risk that we could be building a brilliant business in the wrong environment or that the environment could take away from us whatever it is that we build brilliantly and you've touched on this with your references to institutions i want to show you this which is south africans fatal fortune if they had invested just in cash and if you had put a hundred rand or 100 million or 100 rivers into south african cash in 1970 and left it there for 45 years you would have 14,000 and that feels like a fairly good result 100 to 14,000 over 45 years of course the immediate complaint from an investment perspective is up but cash is naked to tax and if you're a marginal tax payer you're going to be giving away forty percent of that powerful cash return but interestingly it's not the text person that does the greatest damage here its inflation because the text person will take you from 14,000 to 8,000 inflation will take you from 8,000 down to one and I've written at the bottom of this picture here that just in the last 25 years South African inflation if you'd put your cash under a mattress South African inflation would have text you eighty five percent so investing for turbulent times or tough times or easy times I would venture and agree with you that this country thing is the single biggest risk we face well ask Maria Aramis again I mean she's running a pretty good business at absa you run a good business in a in a country that is is exposed to currency risk exactly there so the raindrops thirty percent the guys at Barclays in the you apart from their capital requirements which earn six stupors into the company because the Basel three you've got to have one hundred percent of the capital so that immediately puts you in the back foot but she's running a really good business within this environment but the rent has made it a shocker when it gets converted into into pounds and what we've been trying to say you know about about 18 months ago I changed my view completely on on South Africa was very concerned about the way the economy was was being managed and then and its public I mean you don't have a look on biz news we run a portfolio and offshore portfolio that we encourage people instead of investing here which is an absolute sin because here you should be investing in your own country to develop your capital etc and we said take your money offshore and the money that has gone off Shores gone into this portfolio and it's any allows return is thirty-nine percent in the last 15 months why well there and thank you very much in the last 15 15 months the rand any laws is number 30 so it's if you've got to take that as a in a country like ours the turbulence that we are going through at the moment as a young democracy in a developing country politics Trump's economics so as an investor you gotta go for places which are a bit more stable and where your currency risk is taken out of the of the equation the the moving back to what what Buffett is on these things and it is related smelly and South Africa like to invest in resources but when you're investing in stock in equities you buying you're leveraging human ingenuity so if you how can you be leveraging human ingenuity if you buying an inanimate object buffered never bars resources so I can't understand the value investors in South Africa who maintain that they follow the Burford principles and they buy resource stocks there might be cheap relative to history but who knows where the commodity cycles going and those are the those are the risk exactly you've got to take risk into account at all times and when you're investing if you you know I had resources for years I've been bred the bloody things if you gonna take a bit i'm going to lose it she's quick quick really quick if you are going to invest in something as highly volatile as blood stock then you may as well go and invest in gold or platinum because you're just taking the same kind of planter's going to different n and having a couple of thousand Rand or number six in roseville
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