Risk analyst says mining companies dismiss the prospect of nationalisation at their peril.

(Bloomberg) The ruling party may institute some form of mine nationalisation, a step that could throttle investments in the world’s biggest producer of platinum and chrome, according to a confidential report prepared for mining executives by a risk analyst.

 A drive to seize mines, banks and land is being spearheaded by Julius Malema, 30, who won an uncontested second term as the leader of the youth league of the ruling African National Congress in June. The ANC in November instituted a study into the viability of nationalisation. The findings will be the “key political issue” in party leadership elections in December 2012, Claude Baissac, the Johannesburg-based founder of country- risk consultants Eunomix, wrote in the report.

 “The possibility of the ruling party voting for a major policy shift affecting security of tenure and ownership of the mines is now greater than at any point since the end of apartheid,” Baissac wrote in the report obtained by Bloomberg News. Mining companies “will now dismiss the prospect of nationalisation, whichever form it ultimately takes, at their peril.”

South Africa is the continent’s largest producer of gold, supplies European and Indian power plants with coal and depends on mining for half of exports. In April 2010, Citigroup valued the country’s mineral resources at $2.5 trillion, the most of any nation.

“It is only our policy conference that is going to bring some finality to the matter,” Jackson Mthembu, a spokesman for the ANC, said in an interview from Johannesburg on July 29.

“Studies are being conducted. We can’t therefore jump the gun.” Malema told reporters in Johannesburg on Sunday that the party is studying how to implement nationalization rather than whether to go ahead with the policy.

An ANC vote for nationalisation “would represent the crossing of the Rubicon for both the ANC and for the country,” Baissac wrote. Shares of companies “with a large exposure to South Africa would tumble. Foreign capital would rush out of the country, bringing an immediate collapse of the rand”.

On July 26 2002, shares of Anglo American (JSE:AGL) Plc, the biggest investor in South African mining, plunged as much as 12% after the Mines Ministry said it was considering a proposal that would require mines to be 51% black-owned. The rand declined as much as 1.9% against the dollar.

Dr Hannes Dreyer, the global leader in Wealth Creation, will interview Scott Picken, IPS CEO. Scott Picken has helped over 2000 people invest in international property to a value of R1.6 billion as is the leading expert in South Africa on Offshore Investment and International Property.

What will be covered:

i.              What is happening in global markets?

ii.             5 fundamental risks facing all South Africans

iii.            Why invest offshore?

iv.           Where? USA, UK, Aus, other markets?

v.            Risks and Growth

vi.           Analysis the investment?

Over 80% of people who invest overseas actually loose money for a number of reasons. Learn what you have to know to ensure you don’t join them and you achieve your goals of Wealth Preservation, a Plan B and most importantly Peace of Mind for your family and you.

We won’t leave until all the questions are answered and you have the knowledge and your plan!

·         Date: 24^th May 2011

·         Time: 7pm – 8:30pm (SA time)

·         Price: R250 (first 100 & IPS Gold and Platinum Clients are free)

·         Click here to book - https://www2.gotomeeting.com/register/998941203

Dear Potential Offshore Investor

Napoleon said, “Information was nine tenths of any battle.” The challenge is do you have the right information, are you choosing the right partners, making the right investments and most importantly asking the right questions?

1.       Information – like water, the right information makes you finically healthier, but the wrong information is like poison.

a.       80% of people who invest offshore lose money and the investment becomes a tremendous headache in a short space of time! According to Real Estate Web -http://www.realestateweb.co.za/realestateweb/view/realestateweb/en/page206?oid=54920&sn=Detail – you could also make far better returns in South Africa.

b.      The reason for this is that people make decisions without the right information.  Sure the sales person gives them allot of information, but invariably they will give people what they want to hear?

c.       An example of this is in the last few months South Africans have bought $184 million on the Gold Coast in Australia. They think they are getting a real bargain, but when you talk to Richard Dunn, OzInvest Acquisition Manager, a company who spends millions on research, says, “We get offered opportunities on the Gold Coast every day! At the moment we would never offer these to our investors as there are huge vacancies and the property values are in real trouble.” Similar examples are Manchester or Leeds, where South African investors believed they were buying real value (perceived huge discounts) and yet there is huge oversupply, banks are not lending and there are huge rental problems. Do we need to talk about the information presented on Dubai and how that has changed?

d.      The questions you need to be asking:

                                                               i.      “How much do you spend on your research monthly?”

                                                             ii.      “Can you show me how you have communicated this research over the last couple of years, so that I can see you really understand your market?”

                                                            iii.      “Can I see the research from an entity that doesn’t have a vested interest in selling something to me and who substantiates this information?”

                                                           iv.      If someone is based in South Africa – “How often do you travel over to the investment country to understand the market and make sure you are keeping up to speed with current trends?”

2.       Partners – the key to the vault of success!

a.       In life there is a saying, a chain is only as strong as its weakest link.

b.      Investors often underestimate how important the choice in your partner is to your long term success. Dr Dolf DeRoos, the World Famous International Property Investors says, “You are only as strong as your team.”

c.       Many investors invest because they like the salesmen, they have been referred by a friend or they associate with a brand. This can be catastrophic to your success!

d.      The questions you need to be asking:

                                                               i.      “How long have you been helping people invest internationally?”

                                                             ii.      “How many people have you assisted to invest in this specific country?”

                                                            iii.      “Is this your core business, or something which is supplementary to your estate agency business where you help people buy homes?

                                                           iv.      “Are you a property investor yourself and have you bought international property?”

3.       Rentals – the life blood of property investment!

a.       Property Investment fundamentals live and die on cashflow. Experienced property investors understand this and it is why they succeed in all property cycles. Inexperienced investors are always chasing the bargain, and yet often they find a great bargain or focus on capital growth, only to realise there is no rental market. This often destroys the investment and in many instances them financially.

b.      Examples of this are Manchester where you can get 60% discounts but there are 2000 units oversupplied on the market. Dubai which is also at a 60% discount, but has massive oversupply problems (The numerous developers who offered rental guarantees who have gone bust are testament to this). And then Las Vegas which is 70% down, but there are 5000 families leaving a month as tourism is down by 60% and there are 32 000 homes on the market.

c.       If there is one thing you have to be certain on is the rental market and where this demand is going to come from. You need to ask:

                                                               i.       “How can you ensure me of the demand for my property when it is ready to rent?”

·         I am not talking about a 1 or 2 year rental guarantee from the developer, which has often been included in the price. I am talking about me receiving long term sustainable rental income at market related rates from the demand which exists.

                                                             ii.      “Are you prepared to put your money where your mouth is based on this guarantee or assurance?”

·         How would you sustain this long term if you were wrong?

4.       Local & International Offices – geography is so NB!

a.       Many salesmen will travel to South Africa with a suitcase, put on a classy presentation, meet you in a hotel, sign you up, take your money and then leave in a couple of days. This is where all the problems start and you can’t get hold of them or find out what is happening, etc. and this is how a “great investment” (supposedly) turns into a lemon.

b.      To be successful you need to ensure the partner you choose to invest with, not only has offices in the foreign country, but also offices and a physical presence in South Africa. It makes such a difference when you can speak to a local South African on the phone, on the same time scales and if needs be come and see them in their office whenever it suits you.

c.       Questions you need to be asking:

                                                               i.      “Where are you offices in South Africa and in the country I am investing in?”

                                                             ii.      “If you don’t have offices in South Africa, how can I ensure that you will still be here in a couple of months or years when I need help with the investment I have bought?”

                                                            iii.      “I would like to visit the property. Who is going to show me around overseas?”

                                                           iv.      “How do you understand the market unless you have someone who is permanently looking for opportunities and living in the property market?”

5.       After Sales Support – the helping hand you need! Trust me!

a.       Most investors only focus on the purchase of the property and they forget how important it is to manage the sale. Salesmen are also only interested in closing the sale, but most importantly not to help you right through the process, when you are investing from afar. Many companies claim to provide the full service to you, but where are they based and how are they going to do it?

b.      Questions which you need to ask:

                                                              i.      “How big is your aftersales team and who will be assisting me personally making sure the property transfers timeously into my name?”

·         Sorry I am not talking about the salesmen, I want an Aftersales Professional who has been dealing in this for many years and understands the nuances between South African property and overseas property.

                                                             ii.      “What happens when the property is ready? Who will be assisting me with transfer of the property, inspections, etc?”

                                                            iii.      “Can I see referrals from people who were happy with your service?”

With these simple questions you can ensure you don’t buy lemons and you can take advantage of the significant opportunities. It is not only wise it is prudent to invest some of your wealth in foreign markets. In the Real Estate article above it talks of the tremendous opportunities locally. We completely agree with this and continue to make great money in South Africa, through the use of strategic partners as they suggest. However once you have made this money, it is essential, if not irresponsible not to, to take some of this wealth and invest overseas. To achieve your goals of Asset Preservation, Capital Growth, a Rand Hedge, Diversification and Positive Cashflow in first world currencies – you need the right information and partners and most importantly to be asking the right questions!

Good luck!

Scott Picken

IPS CEO

www.ipsinvest.com

Boom, credit crisis and subdued aftermath

Fiona Shaik

Analysts were cautious about reading too much into one month's data but noted that recent mortgage approvals data had also pointed to a weakening market and that fragile economic conditions meant the outlook was bleak.

However, the figures did little to alter the view the Bank of England will leave interest rates steady at 0.5 percent and the stock of its quantitative easing purchases on hold at 200 billion pounds when its monthly meeting concludes at noon British time..

Halifax said September's fall was the biggest since records began in 1983 and left house prices up 2.6 percent in the three months compared with a year ago, the weakest rate December.

In August, Halifax said house prices rose 0.4 percent on the month, for a three-month annual rate of 4.6 percent.

Analysts said September's surprisingly weak reading could just be a blip, especially as rival mortgage lender Nationwide reported last week that house prices rose 0.1 percent last month.

"While the September house price drop highly likely overstates the weakness of the housing market, there seems little doubt that the housing market is now in reverse," said Howard Archer, economist at IHS Global Insight.

"Rather than crash, we expect house prices to trend down relatively gradually over the final months of 2010 and in 2011 to lose around 10 percent in value."

Halifax economist Martin Ellis said it was too early to tell whether September's decline marked the start of a steep downward trend in prices.

He said the quarterly figures provided a better picture of the underlying trend, showing house prices were 0.9 percent down in the three months to September compared with the second quarter of this year.

"This rate of decline is significantly slower than the quarterly changes of between 5 and 6 percent that were seen in the second half of 2008," Ellis said.

"It is therefore far too early to conclude that September's monthly fall is the beginning of a sustained period of declining house prices."

(Reporting by Fiona Shaikh, editing by Mike Peacock)

International Property Solutions (IPS) is looking for the best 3 sales people in South Africa. Please do not reply to this opportunity unless you are the best!

Although there are challenges in both the local and the international property markets, IPS has some fantastic and exciting opportunities and thus more demand than we can handle. Depending on your ability, the range you can earn:

• Average performer = R30 000 a month
• Great performer = over R200 000 a month or more!

Young or Old if you have the stuff we will know.

Location not a problem – ability is what we are looking for. Most importantly is the ability to work with High Networth Individuals and even better is if you have your own network!

Either Full time, or if you have your own company, we can become strategic partners!

If you are interested, please email to thembi@ipsinvest.com. Please tell me why should we choose you & why you are the best

This is what you can expect:

Value to you – 10 Items which are vital to your future!

1. Ability to earn foreign income.
2. Ability for great cashflow.
3. Ability to grow your international business part time, while running your successful business.
4. Ability to provide real value to your clients and offer them a differentiated product which they want.
5. Ability to learn the latest trends in property. South Africa is directly affected by what is happening international and this will position you as a market leader when you can speak with you clients with experience about the global market and how it will affect them locally.
6. Ability to learn the latest techniques being used internationally to provide your client with the best service and therefore get the most profitable use of your time (make more sales).
7. Ability to learn the latest techniques and methods to get the maximum returns from your Internet, Google, your website, email and social networking strategies.
8. Ability to be part of an International Network which provides you with credibility, but also the benefit of using it for securing local mandates.
9. Ability to be part of the International Network where you will be able to benefit from the mutual partnerships, constant information sessions for your clients and quarterly and yearly events to keep you abreast with the latest international trends. This will ensure you remain the leader in your industry.
10. Ability to remain being the Number One Player in your market and take your business to the next level!

Key Benefits of the International Training Academy

Scott Picken, IPS CEO, is constantly travelling the world and attending courses to understand the latest trends and techniques. On his latest course in USA, there was an intensive 4 day course (60 hours and a cost of R150 000) from 12 of America’s Leading Businessman on how to deal with the current market, take advantage of it and grow your business by 300% in 2010! Scott wants to try and share everything he learnt and some of these are:

1. Vision – what do you ultimately want for your business?
2. What season are you in?
3. The life cycle of business – how to get to the next level?
4. Power of Strategic Innovation
5. 3 ways to grow your business
a. New methods for marketing in the 21st century
b. New ways to get clients to take action
6. Defining your business process
7. 12 skills of all great companies
8. Direction of Influence – the Rugby Field Communication Model
9. 7 steps for implementing everything in your business
a. RPM
b. Your master action plan to implement

Please also pass onto to anyone who you think would relish this opportunity.

I look forward to working with the best.

Scott Picken
IPS CEO

I've got two questions for you. First, is the performance of your share portfolio satisfactory?  Second, is the interest you earn in savings accounts, government bonds etc, enough?

If you are not happy, then the big question is how to do better in the future. Where should you invest your money for the highest returns?

Let's start by taking a look at the table produced by Barclays Capital  that compares the performance of different asset classes over the last ten years.

Share investment comes out last, with a pathetic return of  -14%! A loss after 10 years of investment. Scary! Most of our pensions and future wealth depends on the performance of shares. Cash deposits were also a poor choice.

Given that the entire Financial Services Industry is geared towards investment that primarily focus on shares this is a travesty. So called 'investment advisors' work with a narrow range of assets and find every excuse to diss other oppportunities, whilst performing terribly themselves. If this sounds like it's my personal pet hate, you are right!

When it's time to review performance - whether it's your job, your business or your investments - I once heard this saying which I love. It's simply this... "Have you made reasonable progress in measurable time?" If not, maybe it's time to change tracks. And after 10 years of miserable performance I personally believe that share investments have had their day.

Is there a better option? Take your pick. Every other asset class delivered better results over the past ten years. What's worthy of consideration? We suggest the top performing investment, although not correctly reflected in the table because of flawed logic.

Property Is Number One!

Let's talk property, listed at Number 4. What's the problem? Simply that the table takes no account of the impact of gearing (borrowing). This is critical to a correct analysis of asset performance.

What's the effect of this mistake? Huge! Assume you gear your property portfolio at the realistic level of 75%, the 10 year return on property jumps from 109% to 436%!  Property is clearly number one, delivering the largest return over 10 years. This superb return is after the fall in values due to the recent property crash!

Rod Thomas FCA