Thursday, July 28, 2011

In the Mind of a Capitalist- Trying to catch up

There is a new crop of the middle class in Nairobi. Backed by available loans and a taste of the good lifestyle, they drive fine looking cars and live in enviable neighborhoods. They probably own the apartments they live for which they have mortgaged most of their income.

This group of people are delusional, they try to live the life the wealthy do only that they is a stark contrast. They have no real wealth. They thrive on flossets not real assets. They are yet to capture the imaginative mind of the capitalist.

Just like our Members of Parliament, they are going to end up poor and will pursue their retirement benefits relentlessly.

Because being a wealthy person requires a long thought process, endless learning and skills to acquire. Only by observing can we learn. The wealthy spend hours in pub not just to enjoy a good beer, but making the deals. It is said that it is easier to get one hour of their time in the golf course than to get 10 minutes in the offices. They have created enviable business streams. They are in every sector of this economy where it matters. They have major interests in the food sector, energy & Power and health. Infact for a guy like Uhuru Kenyatta, his family controls over 33 % of the milk that is consumed in Nairobi.

Unless you are Uhuru Kenyatta, the best you can do is watch and learn. That should be a first step. However long it takes.

Anyway, we are analyzing the steps followed by the Capitalist and Middle Class act trying to catch up.

The Capitalist might have bought some real estate on Thika Road some 10 years ago when the prices were between 200,000- 300,000 per acre. The Middle class is trying to buy now at a cost of more than 5 Million per acre. Of course the capitalist makes a hasty exit to cash in on the property boom. The Middle class is trapped with a loan of Ksh. 5,000,000 at insane interest rates.

Meanwhile listed stocks prices are beginning to get affected by the inflation rates and the looming general election. The middle class while reading the signs begin to exit while the capitalist having cashed in, enters the capital markets at rock bottom prices and waits for a few years. Of course as my first broker told me the more shares you have, the more dividends you get. Quantity does matter. The middle class makes a decision not to invest again, after getting seriously burned.

The Capitalist starts looking outside of the city to see where next he could take his money. He enlists some professional advice to know where its going to be hot in the next few years. The middle class stays away from these places. In any case, nothing looks like is going on in these places.

To cut the story short, the capitalist ends up in the political power and influences development in the area that he bought a few years ago. The Middle class runs there and buys the same property 1000% more. The middle class at this point might be forced to start a civil rights organization, after all the NGO's make a lot of money right?

So the middle class guy loses most of his money in the stock market, high bank interests and a reckless lifestyle and is forever complaining about the gap between the rich and poor.

Also read

Wednesday, July 27, 2011

The STL Controversy

Amidst the Norwegian bombings, something important happened or at least important to Kenyans. A young Kenyan woman has found herself in the midst of a controversy.She was chosen to represent Norway in the Eurovision Finals. A lot of people including Kenyans have expressed their feelings that STL is not Norwegian enough to represent that country.

She killed it by the way judging by the You tube video for her performance.

What i feel is if she entered the contest and won, then i guess the Norwegian people felt that she was a true representative of their country. Never mind, the song is about a Kiswahili Methali Haba Haba Hujaza Kibaba (Little by little the jar is full) well, my interpretation.

I guess it is the same thing African felt when Shakira was chosen to do the Waka Waka song at the World Cup in South Africa.

But really, the world is flat these days, I don't understand the fuss.

Tuesday, July 26, 2011

Things on my mind


With fuel prices moving up from Ksh. 96.00 to Ksh. 115.30, things are beginning to look thick. I think it's high time we printed the Ksh. 5,000 note as it is only worth a few things in the supermarket these days.

Is it a coincidence that fuel, food prices are heading upwards while the foreign exchange rates going up every other day. Such a time is when the CBK governor should give someone else a chance to see if things can be improved.

2012 Politics

There is so little to say about the current crop of politicians. I have no hope in them and do not think there is much to expect in the next 5-10years. Maybe they will prove me wrong.


It's a sad day in Africa, a sad day in the world. How can a continent full of resources be facing famine? As we speak hordes of people from Somalia are moving to the refugee camps in Kenya.

Amy Winehouse

Now this post looks all sad and groomy but how can i not mention Amy Winehouse! May she R.I.P. She was a talented singer and many have mourned the waste of talent but it seems as an African would say, her day had come. She fought with drugs for many years but she lost the battle.