When I attended a conference in Australia in 2007, I heard, for the first time, of the concept of ‘black swans’. Author of The Black Swan: The Impact of the Highly Improbable, Nassim Nicholas Taleb, was a speaker, and I must confess that I saw little relevance in his talk at the time.
He explained that ‘black swans’ are events in human history that are “unprecedented and unexpected at the point in time when it occurred.” In light of the events of 2016 – both locally and globally – Taleb has found a convert in me!
This year has seen a plethora of black swans, and they are unlikely to be the last. Brexit was one of the greatest surprises of 2016, but that shock has been completely overshadowed by Donald Trump being elected US President.
Locally, we have the formerly unassailable ANC conceding a number of municipalities to the DA, the disastrous Nenegate almost a year ago, and the ongoing #FeesMustFall campaigns countrywide.
What are these black swans teaching us? That the world is changing, and we will face many more unknowns in the future. We will learn to live with uncertainty. Don’t get too attached to the past – there is a new normal.
With all these unanticipated changes, our Rand has had a volatile year: though flat over the last 12 months, it has been as high as 16.48 and as low as 13.36 to the USD. A little more encouraging, the Rand Pound is down from a high of 24.40 to 18 as at 15 November.
Our market has held up well with all the negativity around us; however, it is 4% down over the past year. More concerning, over three years, we have seen only a 9% return.
This does not really reflect the state of the South African economy, though we are not forgetting that 71% of the JSE’s earnings comes from offshore – this provides a hedge against Rand depreciation.
At Chartered House
One way to embrace the opportunities offered by uncertainty is to strengthen what is already working. At Chartered, we have grown by 10 staff in 2016, bringing greater capacity and expertise to our planning teams. Three of our planners: Christina, Jason and Tiffany, have qualified with their Advanced Post-Graduate Financial Planning Diplomas in Estate Planning and Risk. Brad, Joelle and Tom have obtained their CFP® designation.
Chartered Legacy welcomes its fourth lawyer to the team in December. In our four years of winding up Estates, we have gained much experience and have developed relationships at the Master’s Office, helping to make this process more efficient.
With the greater need for financial planning in turbulent times has come the opportunity for Chartered to present retirement seminars at Anglo, PWC and SAB. Without doubt, having a retirement plan and being invested in a globally diversified portfolio stands you in good stead for what lies ahead, to ensure you live a successful retirement.
I wish you a wonderful festive season with your family and friends. We look forward to an exciting 2017.
John, Barclay and Kim