I dialled into a presentation given by my father, David, on the lessons he’d learnt from 50 years on the Johannesburg Stock Exchange.
My first real job in Australia involved ringing up councils to ask why they were investing in CDOs , and two years later, I worked on the trading floor of an Australian bank during a credit crisis that triggered yet another epic collapse in the stockmarket. But surely other asset classes such as bonds, corporate debt, property and heaven forbid, hedge funds, had a role to play? Not according to David Shapiro. His strategy has been all equities, all the time.I am certainly not here to advocate that anyone do the same. But I have finally appreciated why it was that my father arrived at that view, and it’s particularly relevant right now: the scourge of inflation.
However, he knows of one group who did manage to withstand the devastating scourge of inflation particularly well: a small cohort of elderly doctors, teachers and lawyers based in two small towns in the Western Cape.