If you are a young person, you need to make a plan to earn more. So, get the right qualifications, find a great employer, marry a spouse with good prospects and think about starting your own business. Double down on yourself. After you've done all of that, find a good service provider to save with.

Josh Brown (that's him in the picture) makes this point very well here:

"Nothing about your asset allocation is going to move the needle the way your career will. There is very little reason for anyone in their 20's to be concerning themselves with the intricacies of portfolio management if they don't have their work situation figured out. Because the difference between reaching peak earnings of $250 000 and $750 000 ten years from now is going to have a major impact on where you can live, what you can drive, how much you can save for the educations of your children, what sort of vacations you're taking and whether or not your spouse will need to work full-time, part-time or not at all."

Once you are flying financially, the best service provider will be Vestact, naturally.

Last week Naspers/Prosus updated the market on their Net Asset Value (NAV). Many investment holding companies own private businesses, meaning they determine the value of their assets in-house. As you can imagine, there are some differences of opinion. In the case of Naspers/Prosus, most of their assets are listed (see below), so the market determines the values, which makes their NAV statement more reliable.

As of the 4th of October, the NAV of Prosus' holdings was $164 billion; $127 billion is the Tencent stake, $10 billion is other listed assets and unlisted assets are worth $25 billion. The rest is sitting in cash. The current market cap of Prosus is currently $108 billion, so it's still trading at a huge discount to NAV.

To try to reduce this discount, Prosus has been selling Tencent shares and using the cash proceeds to buy back their own shares. I fully endorse this strategy. As of 30 September, Prosus has bought back 23% of its free float since the scheme started. That is a huge chunk of buybacks. Hopefully they are selling lots of Tencent shares at the moment, taking advantage of the Chinese stimulus bump.

This NAV gap-closing uplift is the main reason we still hold Naspers/Prosus in local accounts.

Yesterday, the 2024 Nobel Prize for economics was awarded to academics Daron Acemoglu, Simon Johnson and James Robinson for their work on wealth disparities between nations. Nobel committee member Jakob Svensson said the trio's work had "helped us understand differences in prosperity between nations" by showing that societies with a poor rule of law and institutions that exploit their populations can struggle to generate growth.

Acemoglu and Robinson are also the co-authors of the book 'Why Nations Fail - The Origins of Power, Prosperity, and Poverty' which was first published in 2012. The book's core argument is that nations succeed or fail based on their institutions, specifically whether they are inclusive or extractive. Inclusive institutions encourage economic growth and prosperity by protecting property rights, promoting competition, and fostering innovation. Being a democracy helps too.

Part of South Africa's problem is that many of our institutions were undermined by corruption, and are now extractive. Money is flowing to Dubai, French champagne, Swiss watches and German cars. On the other hand, we have a strong democracy, with property rights and a legal system that works.

The research is clear and we know what South Africa has to do to recover economically. We just need the political will to change.

Tokyo Metro is raising $2.3 billion through an IPO, after pricing shares at the top of the range at JPY1 200 each. They will float the shares on the 23rd of October. It's the largest listing in Japan since SoftBank's $21 billion IPO back in 2018.

IPOs in Japan have raised $1.6 billion this year and is expected to be closer to $4.4 billion by year-end. Global investors have shown major interest, fully covering the international portion of the offer, and the domestic side (80% of the total deal) is also fully subscribed.

The government of Japan currently owns 53.42% of Tokyo Metro, while the Tokyo Metropolitan Government holds the rest, but after the IPO, their combined stake will drop by half. The deal is being coordinated by Nomura, Mizuho, and Goldman Sachs.

If our local government had a strong track record of running state-owned entities, we'd likely see them listing those businesses on the JSE, unlocking and creating value in the process. But these individuals couldn't find coconuts on coconut island!

Getting rich is tough. Staying rich can be even harder - GM founder lost control of the car manufacturer twice, and died broke.

Google is an early investor in AI research. These investments have earned some of it's employees Nobel Prizes - Google racked up 3 Nobel Prizes.

Asian stocks are mostly in the green this morning, with the MSCI Asia Pacific Index gaining, driven by strong performances in the chip sector. TSMC (+1.9%) and Tokyo Electron (+4.7%) were among the top contributors. Japan's Nikkei 225 hit its highest point since July, and benchmarks in India and Taiwan also saw gains, while Hong Kong and mainland China continued to slip.

In local company news, AVI reported a 6.3% increase in revenue, hitting R15.9 billion for the year ending June. Thanks to strong cost controls and smart pricing moves, the company delivered gross profit margins of 42%, its highest since 2019.

US equity futures are unchanged pre-market. The Rand is trading at around R17.59 to the US Dollar.

Today, earnings reports are expected from UnitedHealth, Johnson & Johnson, Bank of America, Goldman Sachs, and Citigroup.

It's drizzling in Joburg today, hopefully this will be the first decent rain of the season. Our gardens desperately need the water.