I strongly believe that Kenya is yet to experience the global recession. This will become evident after the Budget exposes huge gaps. What will follow is a massive recession followed by further collapse in the NSE.

Next to collapse will be Kenyan shilling thus prompting the few remaining foreign investors(including Kenyans in diaspora) to pull out of the market. Then is when the NSE will really take a nose-dive to sub 2,000.

Meanwhile,the political infightings within the coalition of thieves will intesify as the lame duck general kiguoya watches from his slumber at State House. There will be a return of street demos as people get fed up with this coalition.

I welcome opinions from both sides of the argument,just make sure your opinions are backed by some reasoning,not insults.

Uhuru is already warning of a possible 500,000 jobs to be lost soon as the recession hits - meaning according to information he now has,the recession has not hit Kenya as yet..

So @Mpenzi and others,dont just brush this aside,bring forth some arguments for or against this topic and let us see where it goes. I wont run from Kenya as Tusker may have mentioned,but I know what he is saying here has reasonable possibility of taking place.

So,if we lose the 500,000 jobs,and the political 'circus' continues,wont u be ready to demonstrate on the streets of nairobi demanding action? I know I might be by then.....so @tusker,maybe u r right.

If 500,000 jobs are lost - from employers some of whom are on the NSE,companies will not be performing well enough for any reasonable gains/profits/dividends to be forthcoming - it makes sense then that maybe under 2,000 is a real possibility.

That is the pessimistic/realistic me speaking - I prefer to think positive that we are already in the recession and by the time we now officially realise it,we will already be coming out of it...so maybe.....either way could be true.


Bidii yangu

Personally,i think the prediction is right this time round.

As i stated elsewhere,i expect it to go down to just about 1700 albeit gradually before the end of the year. The main reasons are incompetent and corrupt stock brokers (remember the forensic audit carried out on Nyaga Stock Brokers and the involvement of NSE,CMA,and the CDSC in its operations just before its collapse,now Discount has gone under,Suntra is sickly and God knows who is to follow),there is very little fresh money going into NSE (in any case investors are running away from the NSE) and the high stock prices are therefore unsustainable,there is a confidence crisis at NSE mainly due to current political status,and the broker malpractices and lastly we have not been hit by the global financial crisis proper (i expect this to be having a disastrous effect on NSE as investors will take a high ground and watch as the prices tumble as they hold on to their cash)...


NEVER TALK OF A RHINO IF THERE IS NO TREE NEAREBY - ZULU PROVERB

Whether the NSE index reaches 2000 or 1700,one thing is sure! Speculators will still make cash! Bounces will never cease! Once a while bargain hunters will be flocking the market and create demand! Those who have learnt to ride the trends will sure benefit!

As Richard Branson said and as someone pointed out somewhere in this forum! This generation will surely create millionaires! It all depends on how smart someone is!

But you shall remember the LORD your God,for it is He who is giving you power to make wealth,that He may confirm His covenant which He swore to your fathers,as it is this day. Deu 8:18

I keep on wondering why people think that being careful(pessimistic) and being a good investor are mutually exclusive on this site.

There are already warnings that things are not too good.


Increase in retirement age - gov't can't pay lumpsomes now
Borrowing even from Arabs - gov't is actually begging from all and sundry
rising inflation - if the 25% inflation figure did not scare you,you need a lesson in economics
Extra rosy pictures all around - Which company can claim that they are going to make supernormal profits. only enron
Have you gone shopping lately with 1k? - What you bring back will tell you exactly what the market is doing

When markets are about to tank a few things happen and this happens all around the world not only in Kenya


Financial institutions start failing - I think this month an insurance firm,and a few brokers are in trouble. you really do not have to wait for a bank to fail too?
Extra regulations - so this is the year that the gov't so it right to take care of the capital market authority?
Fake bounces - If prices are going up or down for no particular reason,then someone is playing the market. If anyone can explain to me how Equity went up 40% in a week without telling me the usual 'its a good company nonsense',I will be willing to listen.
All of a sudden everyone in gov't starts telling you how strong the economy is. - If its that good,they would not need to say anything
Property Market stops growing - There is nothing like property values are the same as last year so things are fine. If you have a valuer who's your friend,ask them if they are valueing less property than same time last year. you should also ask them who their clients are. If it is buyers,that is different than if it is banks. I would suggest you get a property valuer as a friend and get him drunk. If his clients are now banks,then the bubble is about to burst.

However,there is the simple test you can do. If you are using more money this month to buy the same items as last month,then things are thick! You really do not have to be told that there is inflation or a recession. Just check your bank balance.


I think that Kenya is sitting on a time bomb especially because everyone is underestimating what this world problem is all about.