Tangeni Shatiwa

Example Page 1

Sun, 05 May 2019 00:00:00 +0100

In this tutorial, I’ll share my top 10 tips for getting started with Academic:

Tip 1

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Duis posuere tellus ac convallis placerat. Proin tincidunt magna sed ex sollicitudin condimentum. Sed ac faucibus dolor, scelerisque sollicitudin nisi. Cras purus urna, suscipit quis sapien eu, pulvinar tempor diam. Quisque risus orci, mollis id ante sit amet, gravida egestas nisl. Sed ac tempus magna. Proin in dui enim. Donec condimentum, sem id dapibus fringilla, tellus enim condimentum arcu, nec volutpat est felis vel metus. Vestibulum sit amet erat at nulla eleifend gravida.

Nullam vel molestie justo. Curabitur vitae efficitur leo. In hac habitasse platea dictumst. Sed pulvinar mauris dui, eget varius purus congue ac. Nulla euismod, lorem vel elementum dapibus, nunc justo porta mi, sed tempus est est vel tellus. Nam et enim eleifend, laoreet sem sit amet, elementum sem. Morbi ut leo congue, maximus velit ut, finibus arcu. In et libero cursus, rutrum risus non, molestie leo. Nullam congue quam et volutpat malesuada. Sed risus tortor, pulvinar et dictum nec, sodales non mi. Phasellus lacinia commodo laoreet. Nam mollis, erat in feugiat consectetur, purus eros egestas tellus, in auctor urna odio at nibh. Mauris imperdiet nisi ac magna convallis, at rhoncus ligula cursus.

Cras aliquam rhoncus ipsum, in hendrerit nunc mattis vitae. Duis vitae efficitur metus, ac tempus leo. Cras nec fringilla lacus. Quisque sit amet risus at ipsum pharetra commodo. Sed aliquam mauris at consequat eleifend. Praesent porta, augue sed viverra bibendum, neque ante euismod ante, in vehicula justo lorem ac eros. Suspendisse augue libero, venenatis eget tincidunt ut, malesuada at lorem. Donec vitae bibendum arcu. Aenean maximus nulla non pretium iaculis. Quisque imperdiet, nulla in pulvinar aliquet, velit quam ultrices quam, sit amet fringilla leo sem vel nunc. Mauris in lacinia lacus.

Suspendisse a tincidunt lacus. Curabitur at urna sagittis, dictum ante sit amet, euismod magna. Sed rutrum massa id tortor commodo, vitae elementum turpis tempus. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Aenean purus turpis, venenatis a ullamcorper nec, tincidunt et massa. Integer posuere quam rutrum arcu vehicula imperdiet. Mauris ullamcorper quam vitae purus congue, quis euismod magna eleifend. Vestibulum semper vel augue eget tincidunt. Fusce eget justo sodales, dapibus odio eu, ultrices lorem. Duis condimentum lorem id eros commodo, in facilisis mauris scelerisque. Morbi sed auctor leo. Nullam volutpat a lacus quis pharetra. Nulla congue rutrum magna a ornare.

Aliquam in turpis accumsan, malesuada nibh ut, hendrerit justo. Cum sociis natoque penatibus et magnis dis parturient montes, nascetur ridiculus mus. Quisque sed erat nec justo posuere suscipit. Donec ut efficitur arcu, in malesuada neque. Nunc dignissim nisl massa, id vulputate nunc pretium nec. Quisque eget urna in risus suscipit ultricies. Pellentesque odio odio, tincidunt in eleifend sed, posuere a diam. Nam gravida nisl convallis semper elementum. Morbi vitae felis faucibus, vulputate orci placerat, aliquet nisi. Aliquam erat volutpat. Maecenas sagittis pulvinar purus, sed porta quam laoreet at.

Tip 2

Example Page 2

Sun, 05 May 2019 00:00:00 +0100

Here are some more tips for getting started with Academic:

Tip 3

Tip 4

Example Talk

Sat, 01 Jun 2030 13:00:00 +0000

Click on the Slides button above to view the built-in slides feature.

Slides can be added in a few ways:

Create slides using Academic’s Slides feature and link using slides parameter in the front matter of the talk file
Upload an existing slide deck to static/ and link using url_slides parameter in the front matter of the talk file
Embed your slides (e.g. Google Slides) or presentation video on this page using shortcodes.

Further talk details can easily be added to this page using Markdown and $\rm \LaTeX$ math code.

Did the South African economy really contract by 51%?

Thu, 10 Sep 2020 21:13:14 -0500

Disclaimer - The opinions expressed here are solely my own and do not reflect the views of anyone else.

The build up to the latest South African quarterly GDP release was captivating to say the least, as analysts awaited eagerly to confirm their projections on just how bad the second quarter (Q2) was set to turn out. The catastrophic economic performance recorded over Q2 was largely in line with most expectations, but by all means still managed to dominate headlines across the country. Stats SA indicated that an economic contraction of 51% was recorded over Q2 of this year - but does this really mean that half of South Africa’s GDP was wiped out in as little as three months? This article offers some insight into why this number might mislead you to think so.

What is the difference between annual and annualised growth rates?

When Stats SA publish economic growth statistics on a quarterly basis, they present these figures in both annual and annualised terms. Here is a quick breakdown of how these two measures differ.

An annual growth rate measures the change in GDP between a given quarter versus the same period a year earlier (in this case, this would be the change between Q2 of 2019 and 2020 respectively). Analysts tend to focus on this metric as it is useful to draw conclusions on whether households and businesses are better (or worse) off today compared to where they were a year ago. Under this approach, the South African economy contracted by 17.2% over Q2 of 2020 (see Figure 1).
In contrast, an annualised growth rate takes the percentage change in GDP between two consecutive quarters (in this case, Q1 and Q2 of 2020) and estimates what GDP growth would be if it that calculated rate persisted for an entire year. In actual fact, GDP only contracted by 16.3% between these two periods - the 51% figure (that’s received widespread attention) was calculated on the assumption that the economy will contract by 16.3% during each quarter over the next year.

There is such a sharp contrast between these two growth rates, so which one provides a more accurate view given the current economic context? Well, the main issue with using annualised figures to measure changes in GDP (particularly in a year as unprecedented as this one) is that outliers will distort how you interpret the magnitude of this shock. To illustrate this point, suppose you receive a one-time bonus of R1000 with your salary this month. It is unlikely that you’ll think this windfall translates into an annual raise of R12000 given your expectation that receiving this bonus is a one-time event. The GDP contraction recorded over Q2 should be viewed in the same light - as devastating as the lockdown measures were on the economy, it is critical to note that this was an anomaly (because policymakers are unlikely to resort to these drastic measures again throughout the remainder of the year). Therefore, it’s unrealistic to infer a long term trend based off the disaster that transpired during these three months.

Figure 1: Annual vs Annualised GDP Growth Rates for South Africa (Q1 2019 - Q2 2020).

Should we expect production to normalise over the next year?

To answer this question, one needs to understand how production has fared since the gradual reversal of lockdown measures has been initiated. An industrial production index can be a useful tool to analyse this, seeing as this indicator is essentially an informal proxy for monthly GDP. The annual growth rate in the economy’s manufacturing sector is shown in Figure 2, which indicates that there has been a partial recovery in production since the historic low recorded in April. A smaller annual contraction recorded over the July already represents some improvement compared to how the second quarter started out, though it its important to note that production levels remain at substantially lower levels compared to where they were prior to the pandemic’s onset.

Figure 2: Annual Growth Rates for Monthly Manufacturing Production in South Africa

Purely on the premise that the economy will be coming off the low base created by the destructive events during the second quarter, it is only practical to expect further (though limited) improvement in production over the next few months as lockdown measures are eased. The unfortunate part about this is that the media’s reaction once the next quarter’s figures are released in a few months will most likely be as overblown as what we saw earlier this week. We can expect a sharp rise in annualised growth at the end of Q3 due to this “low base effect” from Q2, which will create the false impression that South Africa’s economic renaissance has taken full effect.

Right now, the economy is going through extreme short-term changes. This doesn’t mean that the scars from the lockdown period won’t remain for years to come - consumption and investment will take some time to fully normalise, and it is unlikely that the job losses induced by the pandemic will be reversed anytime soon either. Additionally, high levels of government debt coupled with depleted tax revenues have left fiscal policymakers with limited buffers to cushion the effects of the shock. With that being said, it makes little sense to suggest that the remainder of the year will resemble anything similar to the unprecedented troughs experienced in Q2. If you share the same sentiment, then you shouldn’t focus too much on annualised growth rates this year.

Do global oil price movements offer insight into the performance of the South African Rand?

Thu, 11 Jun 2020 21:13:14 -0500

For much of the past decade, the South African Rand has been regarded to be amongst the most volatile currencies in the world. However, nothing from the past 10 years could have prepared Rand investors for the set of unprecedented events which 2020 has brought so far. Essentially, the South African economy has been hit by a perfect storm following a series of sovereign credit rating downgrades in April by Moody’s and S&P, compounded even further by the COVID-19 pandemic. This resulted in a huge Rand sell-off equating to roughly 28% against the dollar between January and April 2020, as the USD-ZAR exchange rate reached an all time low of R19.35. Since then, the Rand has partially clawed back from this slump as the world begins to re-emerge from national lockdowns imposed to curb the spread of the pandemic.

Given South Africa’s exposure to oil prices (particularly with Brent crude oil being priced in dollars), directional movements of oil prices can be an extremely useful tool in analyzing the USD-ZAR exchange rate. Oil-Rand analyses hold merit on the premise that oil price movements offer a snapshot of the global dynamics which the Rand is also exposed to.

The dynamics of oil prices as a measure for Rand performance

In theory, lower global oil prices are supposed to have a positive effect on the Rand (through an improved trade balance), given that South Africa imports its oil. Although it is plausible that this relationship exists when taking a long-term view on the South African economy, it is interesting to find that the exact opposite effect tends to persist through the short-run. Rand weakening tends to coincide with periods in which global oil prices are on the decline, and vice versa.

There are several reasons which explain why the abovementioned phenomenon exists. Firstly, the value of both of these commodities are likely to fall simultaneously during periods of global risk aversion, as investors ditch risky assets in favor of safe-haven ones (such as the USD). Secondly, lower global oil prices could be a reflection that global growth (and commodity prices in a broad sense) are on the decline, which would adversely impact the value of commodity-linked currencies (the Rand in this case). Lastly, because global oil prices are denominated in USD, declining oil prices in dollar terms would indicate that the greenback currency has strengthened, which by symmetry implies a weakened Rand.

These sentiments are supported by trends identified in Figure 1. By analyzing this figure, we can see that a stronger Rand (i.e a lower USD-ZAR exchange rate) is more likely to occur during times in which oil prices trade at higher levels. Extending on this, lower oil prices (and a weaker Rand) generally coincide with periods of high market uncertainty. In order to quantify these periods of high uncertainty, one can use the CBOE Volatility Index (VIX).¹ Here, it is evident that higher levels of market volatility (illustrated by the darker observations from the distribution of outcomes in Figure 1) are concentrated at points below the USD40 per barrel mark. Furthermore, the trend line in Figure 1 clearly indicates that there is a non-linear relationship between the oil price and the Rand. This means that the further the oil price declines, the sharper the depreciation in the Rand would be (i.e depreciating at an increasing rate). This is exactly what we have seen between February and April, which underpins just how important risk sentiment is when predicting the path for a commodity-linked currency such as the Rand.

Figure 1: Weekly data downloaded from Yahoo Finance (Jan 2015-June 2020).

This model suggests that given current oil price levels, the Rand is undervalued

As of the 10^th of June, Brent crude oil and the Rand were trading at actual levels of around USD38 per barrel and R16.50 (against the USD) respectively. We can derive an implied value for the Rand by analyzing the non-linear trend line in Figure 1. With this, a USD38 price level for a barrel of crude oil implies that the Rand should be trading closer to R15.50, which suggests that the Rand is undervalued at the moment. This is encouraging - an undervalued view on the Rand could bode well for its outlook over the near-to-mid term, as foreign and local investors continue their search for high-yield investment opportunities. This bullish view on the local currency is supported further by the following considerations

A recovery in oil prices following the unprecedented sell-offs between February and April. This is set to be fuelled by 1) an improvement in global oil demand as countries transition out of periods of lockdown, as well as 2) supply-side stimulus effects on the back of the historic OPEC+ agreement reached in early April.
A low/zero interest rate environment throughout Europe and the US, which has recently resulted in investors being squeezed towards buying riskier assets (such as the Rand).
South African bond liquidations have eased in recent weeks when contrasted with the rapid rate at which investors were dumping these bonds in the build-up to Moody’s sovereign credit rating decision in April.
A bullish view on gold prices should provide some relief for South Africa’s exports and trade balance, which would theoretically boost the Rand (South Africa is a major gold producer).

Of course, there are notable downside risks which oil prices and emerging market currencies are faced with in the current economic landscape. For one, a second wave of the COVID-19 pandemic in countries that have managed to slow the initial transmission of the virus could re-trigger a spike in market uncertainty, similar to what we experienced earlier this year. Also, an escalation in market uncertainty could be exacerbated by heightened trade tensions between the US and China, which would force investors to be bearish towards the Rand. Lastly, it is no secret that South African economic prospects continue to be hampered by poor growth levels and a deterioration in public debt, which can be expected to translate into adverse outcomes for the Rand. Therefore, it remains to be seen whether these headwinds will outweigh the prospects for a further recovery in the Rand over the next few months. Without a shadow of a doubt, investors and the general South African public will be monitoring these developments rather closely over the near future.

The CBOE VIX measures the market’s expectation of 30-day forward-looking volatility on S&P 500 Options. This index is commonly used in financial analysis as a proxy for global market uncertainty.↩︎

Paper - A Bayesian Approach Towards Understanding the US-China Trade War

Sat, 01 Feb 2020 00:00:00 +0000

Paper - Decomposing the Heterogeneity in Portfolio Flows to Emerging Markets

Sat, 01 Feb 2020 00:00:00 +0000

Paper - Diffusion of Renewable Energy Technologies - A Policy Perspective

Sat, 01 Feb 2020 00:00:00 +0000

Paper - Time Varying Correlations in Emerging Market Equity Indices

Sat, 01 Feb 2020 00:00:00 +0000

Click the Cite button above to demo the feature to enable visitors to import publication metadata into their reference management software.

Paper - Modelling the effects of Credit Easing in the US using a DSGE approach

Mon, 01 Jul 2019 00:00:00 +0000

Slides

Tue, 05 Feb 2019 00:00:00 +0000

Create slides in Markdown with Academic

Academic | Documentation

Features

Efficiently write slides in Markdown
3-in-1: Create, Present, and Publish your slides
Supports speaker notes
Mobile friendly slides

Controls

Next: Right Arrow or Space
Previous: Left Arrow
Start: Home
Finish: End
Overview: Esc
Speaker notes: S
Fullscreen: F
Zoom: Alt + Click
PDF Export: E

Code Highlighting

Inline code: variable

Code block:

porridge = "blueberry"
if porridge == "blueberry":
    print("Eating...")

Math

In-line math: $x + y = z$

Block math:

$$ f\left( x \right) = ;\frac{{2\left( {x + 4} \right)\left( {x - 4} \right)}}{{\left( {x + 4} \right)\left( {x + 1} \right)}} $$

Fragments

Make content appear incrementally

{{% fragment %}} One {{% /fragment %}}
{{% fragment %}} **Two** {{% /fragment %}}
{{% fragment %}} Three {{% /fragment %}}

Press Space to play!

One Two Three

A fragment can accept two optional parameters:

class: use a custom style (requires definition in custom CSS)
weight: sets the order in which a fragment appears

Speaker Notes

Add speaker notes to your presentation

{{% speaker_note %}}
- Only the speaker can read these notes
- Press `S` key to view
{{% /speaker_note %}}

Press the S key to view the speaker notes!

Themes

black: Black background, white text, blue links (default)
white: White background, black text, blue links
league: Gray background, white text, blue links
beige: Beige background, dark text, brown links
sky: Blue background, thin dark text, blue links

night: Black background, thick white text, orange links
serif: Cappuccino background, gray text, brown links
simple: White background, black text, blue links
solarized: Cream-colored background, dark green text, blue links

Custom Slide

Customize the slide style and background

{{< slide background-image="/img/boards.jpg" >}}
{{< slide background-color="#0000FF" >}}
{{< slide class="my-style" >}}

Custom CSS Example

Let’s make headers navy colored.

Create assets/css/reveal_custom.css with:

.reveal section h1,
.reveal section h2,
.reveal section h3 {
  color: navy;
}

Questions?

Ask

Documentation

External Project

Wed, 27 Apr 2016 00:00:00 +0000

Internal Project

Wed, 27 Apr 2016 00:00:00 +0000