NSE and RAILAS LEAD

Are the accusations that the Nairobi Stock Exchange is loosing out due to our candidates lead in the opinion polls genuine or are they just political propaganda

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18 Responses to NSE and RAILAS LEAD

  1. Stephen (Nairobi) says:

    I have been particularly disturbed by the reckless pronouncements from the PNU side on the performance of the Nairobi Stock Exchange (NSE). Some of us happen to understand the dynamics in that market (much as Kimunya thinks we are only capable of operating in a fish market). The NSE indices are on the down turn for several factors:

    1. – it is first, a normal cycle the world over that such markets will decline to some extent closer to an election and then recover significantly afterwards (if the elected government is pro-business) or decline further (if the elected government is perceived to be ‘anti-private enterprise’). This is therefore not unique to Kenya now, and no research has been done to relate the slump to Raila’s and ODM’s surging popularity.

    2. – Closer scrutiny reveals that those who are offloading sigificant amounts of shares now (and thereby slumping the prices) are mainly the Mt Kenya elite who have acquired most of that wealth lately through some rather questionable transactions – remember Equity, East African Cables and the book-building techniques on KenGen and Kenya-Re?. It is not too outragious to contend that they are doing it deliberately to prove a point.

    3. – Curiously, the so called foreign investors are not offloading the holdings in any unusual manner – naturally, these would have been the most threatened lot if the threat was real.

    4. – it is a fact that the rising inflation ocassioned by increased fuel prices, and prices of basic commodities must have an impact on the market, whether there was an election or not!

    5. – A good analyst will spend some time looking at the impending Safaricom IPO and it’s impact on the market. This is a Shs 34 billion transaction. Most of the people intending to invest in this stock are forced to offload some of the holdings in securities already in the market to raise the funds to invest in this ‘choice investment’. That must bring down the indices for the time being.

    6. – the market started the slump long before Raila’s popularity started surging.

    It is therefore ridiculous for a whole Minister of Finance to peddle some lame propaganda while in the process exposing his innate chauvinistic airs against ‘people who are only able to understand a fish market’. My take was that this is the way he perceives Luos and Luhyas who happen to be associated with fish a lot – meaning they are all damn and that’s why they are supporting ODM

    For your information, these same gentlemen who understand such complex things as stock markets have now lined up to buy Telkom Kenya (as a strategic partner through a company based in France). And they will buy it for a pittance. That’s why there is the rush. Anyone who read the Eat African Standard today would have noticed how they have lined up their cronies there as the new management to facilitate the process.

    They have used very dubious methods in the past to get a stake in Rift Valley Railways (RVR), the concessionaire for Kenya-Uganda railways. I am sure it is still fresh in your minds how they twisted Strive Masiyiwa’s and Zack Wazara’s arms into getting a stake in Econet Wireless before finally giving them the mobile telephone operator licence. WITH ALL THESE TACTICS, I AM FORCED TO CONCEDE THAT INDEED THEY UNDERSTAND THE CAPITAL MARKETS BETTER THAN ANYONE!!!!

  2. jaringa a.a. says:

    Congratulations for those that we have achieved and hope everything goes as per expectations of Kenyans, YOU ARE THE FOURTH PRESIDENT OF THE REPUBLIC. However, I want one area given a little more emphasis and explaining during this time of ectioneering and even soon after forming the government, God willing. I would want Kenyans to know and be reassured in no uncertain terms that even under a decentralized governance (disparagingly, in Kenya, referred to as Majimbo), every Kenyan citizen will still be free to move around the country as she/he wishes and own property or reside in any Jimbo of his or her choice. Moreover, citizens should further be made aware of the fact that the current devolution of government dose NOT devolve power and or resources on the basis of the colonial system as typified in the provincial (read tribal, hence Nyanza = Luo; Rift Valley = Kalenjin or Central = Kikuyu)administrative units. This concern may appear trivial to those who understand the theory of devolution and have probably read the Bomas Draft but it is not very apparent to the general public and can deliberately be misrepresented to the general public for short term political gains, as I have heard the First and the Second Presidents try to. Moreover, it will be even more valuable when we finally enact the system so that people will have been prepared to appreciate the fact that optimal sharing of national resources DOES NOT mean rejecting your neighbor. In fact, the best Jimbo will be that Jimbo where all faces of Kenya are represented.

    One more thing that you have not exploited is the fact that your self you are an accomplished business person and there is no way that your administration will be anti-business. People like Kimunya, who hitherto to their debut in politics had no business record to speak of, should never be given the leeway of describing your economic policy. Yes, you have criticized the NSE, and so have many many other concerned Kenyans. NSE indices do not reflect reality. Transactions at the NSE since the departure of Dr. Gunesekara and to some extent Paul Melly (now of the Standard) from Capital Markerts Authority, CMA, has created a quite a few eye brows some of which have been documented but ignored. CMA, it would appear, long ceased to exist and the investing public left at the mercy of rogue traders and brokers. Even with the supposed automation of the exchange and its robust daily turnover, try selling retail shares as an individual and you soon realize you’ve been conned or you don’t belong or both. NSE has been turned into an institutionalized entity for fleecing poor investors. No analyst worth his/her salt ever thought the rally of NSE would keep going. It has never been supported by the real factors so what is going on is a market correction with the brokers, traders and the connected smililing all the way to the bank as the un informed investors bearing the brunt capital depreciation. It would surprise you to know who sold and caused the the market to lose value. They are definitely not the poor civil servant who borrowed a coop loan to purchase the shares, the diaspora investor who is going through the indignity of cleaning peoples’ asses nor the mama mboga breaking her back with assorted veggies. Yes, you guessed right. The sellers are the multi-billionaires who not only have the insider information but also happen to own millions of stocks in the same corporations they control and which they’ve all along new were overvalued. One more thing, some Kenyans thought they owned shares(stocks) yet the brokers never bought them for them in the first place or had actually sold their stocks without their, the owner’s knowledge. So the reduction in capitalization we are seeing right now is about straightening the books in case the next government appear to be more curious. NO. ODM should never negotiate transparency at the NSE. Let NYSE history of the 1920’s be lesson enough. We need no more precedents.

  3. nmugaya says:

    If there was real panic due to Raila’s popularity to PNU and the government of the day its to their advantage – that their candidate is favoured by the so called ‘investors’.

    Since in reality there is none they are becoming the panic and they want to cause it by Kimunya’s statements. People like Norman Nyagah who does not know what his constituency can do with six million I do not know what he understand about NSE.

    You took the right step by going to NSE personally. Kimunya is worried the all inclusive ‘Centralized’ ministry for Finance would soon be Kenyanized.

  4. BOB says:

    the Problem was not Raila. it was kimunya (finance minister) and the Nairobi Stock Exchange chairman who went to the Media to create fear.

    Such accusations have been made by no less authorities than Finance minister Amos Kimunya and NSE chairman Jimnah Mbaru.

    Raila, we support your patriotism.

    Gikuyu & Mumbi.

  5. abraham k. rotich says:

    i just donn’t get it. the pnu people are saying that the opinion polls are wrong and that they don’t reflect the situation on the ground.then a minister says the surge of odm’s canditate popularity in the polls is causing a run in bourse !. so the opinion polls are sufficiently accurate as to cause panic selling by crooks at nse?. odm has promised 10 %+ growth rate per year. would it want to distabilise the nse ?. the simple answer is no. all others are cheap propaganda.

  6. tnk says:

    Kimunya is lying, he knows it, everybody knows it. But since the government of the day is aware of imminent change in government, they are looking for any fresh reasons to instill fear in the mind of the mwanachi. Carrot and stick treatment, Kibaki walking around handing carrots and goodies, PNU members walking around with humongous sticks to instill fear. Thank you stephen for the detailed insight, personally I cannot even begin to engage any intellectualism on these guys, it would be a totally wasted effort.

  7. tnk says:

    i would also like to ask these fellows going around claiming improved economy to allow independent study to determine exactly what economic policies have been implemented, thow they are different from the previous regime, and who formulated the strategies for those policies. THen I’d like to know how many of them were initiated by the true NARC rainbow govt. and how many are the brainchild of or can directly be attributed to Kibaki, PNU or GNU. THen i’d like to know if we are to believe that these “sound economic policies” have turned the country around so fast why they are not writing books and selling these gems. The truth is, for the economy to improve, the first step was to remove the Moi regime. ANd I bet thats what has caused the turnaround. Next is to get visionary planners and economists to chart long term growth strategy.

  8. tnk says:

    I stumbled upon some papers that I’ve been looking for and would urge all those that can distribute these to do so.

    Much has been said about Kibaki and improved economy. I’ve been shouting at the top of my voice that it is premature and also naive to do so.

    although these are not necessarily authorities on the issue, the point is they at least present statements based on fact.

    These documents were written before teh fall-out and at least are not biased

    read this document first

    http://www.nottingham.ac.uk/economics/credit/research/papers/cp.05.06.pdf

    pay attention to second para page 8 of 51

    another document with similar observations is this one

    http://www.gdnet.org/pdf/draft_country_studies/Kenya-MwegaFR.pdf

    and then look at this one

    http://www.afrol.com/Countries/Kenya/backgr_economic_performance.htm

    all show declines from 1973 and worsening till 2002. My point is

    a) Kibaki was Min for Finance 1970 – 1983 which means he inherited a growth but this started declining in his 3rd year and all the way for 10 years
    b) the economic turn around is not due to any of Kibakis doing but a combinations of several factors chief of which is removal of Moi regime. THis brought about the return of donor and investor confidence. Public goodwill and other factors that need a detailed study.

    We need to tell these PNU goons to stop these lies being peddled that Kibaki has turned the economy around. He has not,

  9. Hanif Virani says:

    Markets are driven by sentiment and at the moment the tide has been moving out. However there should be plenty of investors who now feel that there is good value in the various counters at the NSE. I would expect bargain hunters to move into the market and this would reverse the current tide.

    Potential investors at the NSE need to feel that a government under ODM will be a government in which the potential of the nation is realized. When individuals and businesses have freedom in which to operate- ie they are empowered then our true potential can be truly unlocked. There are some in the nation that prefer us to be caged. The masters/clique thus remain the masters. Unlock the cage and the NSE will soar…

  10. Eric B says:

    The way I see it lets give credit where its due. Mzee Kibaki’s government has done its “ukarabati” and we can acknowledge that. Now though, it is time to stop taxing on the runway and take off into the skies. I sincerely beleive that Rails is the person to take us to those heights. To blame him therefore for what is happening at the NSE is the epitom of frustration on the part of some individuals in the government.

    If the stock exchange loses gound Raila being a businessman in his own right also loses money which is not in his best interests. This is not rocket science. Some people should also come clean and tell us where PNU is getting all the money to fund its campaingns with goodies to boot. Kenya’s economy does not revolve around the “rise anf fall (if any)” of Raila’s popularity. I am not an economist but even I know this!

  11. Phil says:

    I have never heard of a stock market reacting negatively to public opinion about elections in the manner that is being suggested by Kimunya who obviously cannot come to terms with the prospects of being jobless in the next few weeks.

    Nevetheless, it is high time ODM’s presidential candidate – Raila Odinga – left the petty politicking to foot soldiers within the party. Raila should strive to sell ODM policies and explain how he intends to deal with the myriad of problems afflicting this country. Lets see ODM/Raila running issue based supplements and adverts in the press each week. Attend as many public interviews as possible. Whenever possible, provide back-up proof, like Raila did in presenting passport photocopies of the Artur Brothers, so that Kenyans can continue to trust Raila as a leader who stands by and speaks the TRUTH.

    That way, the likes of Kimunya will not have any ‘airtime’ to make wild allegations, as if investors vote in this country. For example, let Prof. Nyongo deal with Kimunya’s accusations.

  12. lexx says:

    It’s sad to hear a whole Minister in the Cabinet saying that NSE is not a Fish maket? I repeat not a fish market so if it’s not a fish market them it’s a market of what.Kimunya stop contradicting yourself by saying that the opinion polls are not true replection on the ground then you claim that the investors are scared of Raila’s presidency.Kimunya be ready for a Raila presidency in the year 2008.Raila is God sent.God bless kenya

  13. Patrick .b. says:

    Am happy to hear what a Hon. member of Parliament said the other day on the diminishing level of NSE activities.once they say that the opinion polls are wrong and that they don’t reflect the situation on the ground.then a minister says the surge of ODM’s canditate popularity in the polls is causing a run in bourse !. so the opinion polls are sufficiently accurate as to cause panic selling by crooks at nse?.Lafdies and Gentlemen,when Kalembe Ndile said that there are people who when they open their mouths 20,000 votes go to the opposition,he was actually referring to the Kimunya’s and Kamanda’s of this World.People who look at Kenyan’s with their tribal eye glasses.Reffering to ”the fish market”is actually an insult.Does Kimunya know that fish is the second largest revenue collector in Kenya?Does he know that banana’s,cotton move the economy of Kenya though Nyanza has never benefited?
    Is ha aware that Sugar cane manufacturers are noot getting any money because of poor or no allocations for large scale farming?
    Is he aware as Kenya’s Finance Minister that there are no road networks to boost production in many areas in Kenya.Kimunya and friends should heed what Kalembe,a man in their own backyard told them.As for us,we cant answer you,instead Kenyans have the final verdict.We are no longer listenig to your self assasination initiatives but will continue analysing you for our own benefit.

  14. tom M says:

    Amos kimunya 9Finance Minister) said he is not floating the second batch of shares of kengen in the market because some individuals had manipulated the share price of Kengen and it did not reflect its true value. in so saying he agrees that the NSE is subject to manipulation by some individuals.

  15. Chepkwony(Kericho) says:

    Even fish markets have order and is not chaotic as some people may imagine!
    To say that NSE has lost over 200 billion is a lie. The people on the ground know that it has lost less than 80 billion between August and October. The utterance of our Hon. Minister is alarmist and is meant to demonize Hon. Raila. I ask Hon. Kimunya and all of us scared of Raila to come to terms with his Presidency come next year. Make peace while time is ripe; you may be late!!.
    I agree with Phil about Issues based Politics. Hon. Raila should steer away from the political quarmire and articulate sound Economic and Social Issues that touches the hearts of all irrespective of where they come from.

  16. Baijo M.Lorowu says:

    One advantage Raila has over and above his competitors is that he does not shy away from confronting the issues and blames. We were excited when he showed up at NSE to confront the issues and face the critics. Rather than responding through the press, he listened to every single blame and answered them very well. I doubt whether these critics and the minister has ever gathered courage to raise the issue again. Coming hot in the heels was the independent research by the NSE & CMA guys.

    The PNU and ODM / Raila haters lack good strategy to pin him down on anything. All the insults hurled at him have backfired very well on their faces…and they must be very disappointed that majority of Kenyans who want meaningful change are well informed and will not buy into anything forced on them, including lies about Raila and his ODM team of leaders.

    We shall win big come the voting day. Whatever evil plans and traps they have will continue backfiring as we march and surge towards real and sweet victory. We just need to improve on where we have reached and target other regions to woo them to our victorious side.

  17. Wilfred Raila says:

    PNU is sinking fast and the number of straws left on the surface to hold on to are down to zero. Markets rise and markets fall, and – given that there is a shortage of believable progaganda items on their side, PNU’s Kimunya decided to be a cry-baby over unrelated things, Raila’s presidencial campaign and the Stock market’s free fall.

    And so he went further and furiously reminded Raila Odinga of the stock market not being a fish market. Truth is, he is on the edge of loosing the best time of his life; his fury is from the selfish POV that Kenya will die with his going.

    THE COUNTRY WILL ALWAYS REMAIN LARGER THAT THE INDIVIDUAL…….

  18. ibrahim hassan says:

    who doesnt know jimnah mbaru is part of kibaki’s golf buddies so he wants to create panic but i tell him we know this country much as we know about the NSE we wont let him and a few henchmen of kibaki go round spreading propaganda about agwambo all we know is if ur clean and have nothing to hide why panic? why are they in so much hurry to privatise safaricom we want to know who holds the shares of mobitella ventures and many more deals that have happened how can this guys who were just ordinary the other day have so much chapa graft must be fought and people like kimunya will have alot of explaining to do in 2008?

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