On the last week of June 2019, on Saturday morning for a late breakfast than the time I’m accustomed to , I was able to catch up with The Market, best known for generating capital for several companies across the world while simultaneously bringing joy and misery to countless of investors. Millions of people observe and follow The Market every day, and many complain about the irrationality and unpredictability of The Market’s outcomes. I sat down with him to get his side of the story, and he was very open and candid.

Charles: Now more than perhaps any other time in history, the spotlight shines brightly on you as people across the world are watching your every move. What are your thoughts on this?

The Market: I totally understand why the focus is on me. Look, the world is deeply interconnected, and investment and economic policy decisions made in one part of the world influence how investors approach another part of the world. For instance, there is this blonde guy who has been tweeting a whole bunch lately and talking about sanctions which has caused quite a disarray for me and my operations especially in the Emerging and Frontier spaces. Then you also have central banks influencing monetary policy through their decisions on the direction of interest rates which greatly impact asset prices. With all these decisions and actions being taken, no wonder I often feel like I’m under a microscope.

Charles: Interesting. With your broader influence, why are investors jittery especially now?

The Market: I hate to break it to you Charles, but investors are and will always continue to be jittery as long as they are humans. I am the culmination of human beings who are driven by greed, fear, panic and euphoria. I’m widely successful due to these very characteristics and since most people will remain irrational, I’ll continue minting money for eons to come.

Charles: What do you mean by irrational?

The Market: Good question, I was wondering when you’d start asking one…First let’s define rational investors. These are people whose investment decisions are simply driven by facts rather than emotional responses. They take a long-term approach, tend to be independent of thought and invest based on the fundamentals of the investments they are evaluating.

The opposite of these people are irrational investors, who tend to largely follow the crowd and whose decisions are driven by emotions, beliefs and stories. These are the same folks who usually buy into fads or get-rich-quick schemes which lead to bubbles and subsequent busting of those bubbles, case in point the global financial crisis of 2008. However, the interesting bit of this is that most investors don’t consider themselves irrational. In fact, their perception of being rational is what’s been so adverse for them and beneficial for me.

Charles: Seems a significant portion of investors are irrational. Does that solely explain why there are very few investors who’ve been consistently at the top in delivering superior returns and beating you over a long period of time?

The Market: Unfortunately, I have to admit some investors have gotten the best of me, but I wouldn’t attribute it solely to irrationality. There is an element of luck especially for those investors who beat me intermittently.  For the investors who’ve beat me consistently over the long run, hats off to them as they’ve remained disciplined and rational in the face of immense biases and noises.

You told me you’re an analyst at an investment company, so I’m sure you’ve heard of Warren Buffet. There is a reason he is the richest investor in the world. What is he now, the third or fourth wealthiest individual in the world, these lists change so often nowadays especially with these garage tech billionaires popping up right, left and center. Anyway, I digress. But his investment acumen is worth studying.

Charles: Thanks for the recommendation. Shifting gears, a bit, what is your view on Africa and especially on the capital markets?

The Market: I’ve done some big business in Africa. Started out in Egypt in 1883, then worked in Johannesburg from 1887 and currently operate in 27 other exchanges. The Africa rising story is encouraging with improving political climate, resource mobilization, a growing and educated demographic and increasing investment capital inflows from across the world.

Most of those factors I’ve mentioned are what you and most of your colleagues read on your desks from the vast number of economic reports being published about Africa. Though, in reality, these factors will remain prospects at best unless proactive measures are taken by both government and the private sector.

Touching on the capital markets, especially Kenya since I happen to be visiting here, the entire stock market is driven by 5-8 companies at best. Over 70% of the daily market turnover is driven by foreigners. The market’s corporate bond market has dried up since the collapse of the two local banks in 2015. The last significant equity IPO was who knows when…I know when but I’m making a point here, so bear with me. In my opinion, a lot must be done by both the local institutional and retail investors to revive and make vibrant both the equity and debt markets. Investor education and awareness about the clear benefits and risks of investing in capital markets is a good place to start and I’m seeing some encouraging action especially in the social media space including from the camp you work for Charles.

Charles: I echo your sentiments on our responsibility as Africans to create more vibrant capital markets. What’s next for you as we head for the second half of the year?

The Market: Same old, same old. I’ll continue doing my business regardless of all the news, noises and so-called shocks across the world, through generating value for the very few investors who are rational and providing a source of capital for companies and governments.

Charles: It’s been nice chat. Thanks for your time and looking forward to touching base with you next year.

The Market: (With a grin on his face) …If you invite me to a better restaurant, I’ll perhaps consider meeting up with you again.


by Charles Miano

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