Welcome to Matters of Mind (MM)
March 2025, First edition
And yes, the budget is up for discussion, but before we dive into it think of how important it is for any government to have reserves for unexpected crises and natural disasters. How does our budget match up?
March 8 was International Women’s Day and has been since 1913, and yet according to Tamara Gillan, CEO and founder of the WealthiHer network
“… 50% of the population can’t name a female scientist [UK]. At 65, a woman’s pension is currently one fifth of a man’s; a mere 20% of leadership roles in finance are held by women and shockingly, just 2% of funding currently goes to female founders.” Source
International Women’s Day celebrates and recognises leaders who break these barriers while pulling others up alongside them.
In this edition we pause to think about what the US tariffs mean. We explore the notion of US exceptionalism, and what this phenomenon, diversification and emerging markets mean for investors.
Please do read the article on how behavioural biases are eroding returns for investors and gain access to the latest Momentum Investments’ Sci-Fi Report.
Discovery says the single biggest driver of medical inflation – nearly half (46%) – is adverse selection. Do you know what adverse selection is?
Your wellbeing is always top of mind for MM, but is it the same for you?
“By prioritising good sleep, we can improve both our mental and physical health, while strengthening our ability to think critically and resist misinformation in an increasingly complex world.” Daniel Jolley and Iwan Dinnick
Enjoy the read!
MM editorial team
Economic Matters
South African budget: Economic growth vs spending habits
The two largest coalition parties in the government will now haggle over the trajectory of the country’s fiscal framework.
As has often been said, we like to see things in black and white, but we mostly operate in the grey. 3min read
Budget 2025: Policy trade-offs in a maturing democracy
Finance Minister Enoch Godongwana’s 2025 National Budget (Version 2.0) reflects a promising balancing act between fiscal consolidation and stimulating economic growth, but significant risks remain, according to Citadel’s Chief Economist, Maarten Ackerman. 2.5min read
Why the Budget Speech matters to you
Roxanne Tobias, Actuary and Head: Marketing & Communications Sanlam Risk & Savings, says, “The Budget Speech isn’t just about big numbers for the nation – it is also about how it will affect us; from Parliament to person…We’re breaking down the jargon and key takeaways to give you an understanding of what it all means for you.” 4min read
What is a tariff? An economist explains
Useful read which will help us to formulate an opinion on whether tariffs are good or bad and for whom. 4min read OR if you’d rather watch this video, 16mins.Can Tariffs Actually Work?
Crises catalyse change
The Trump trade wars are now in full swing, it seems. Steep US import tariffs took effect on goods from Canada, Mexico and China, though some of it was paused again. The uncertainty remains. The European Union (EU) is likely to be next, especially since US President Donald Trump seems to believe that the EU was created to rip off the US. In fact, the EU and its predecessors were created with US support both to prevent a repeat of the catastrophic wars of the first half of the 20th century, and to be a bulwark against Soviet expansion. 5.5min read
A potential $110B economic hit: How Trump’s tariffs could mean rising costs for families, strain for states
Trade isn’t just about numbers on a spreadsheet. It’s about real people, real businesses and the intricate economic fabric that connects the nation. Changes to this system can come at a high price. Safeguarding American jobs and ensuring economic stability entails recognizing the realities of global trade and considering the trade-offs of instituting new policies. A sobering 5min read
Financial Services Industry
Road Accident Fund Faces Financial Meltdown as Liabilities Exceed R300 Billion
The Road Accident Fund (RAF) is heading for financial disaster, with liabilities exceeding R300 billion and fuel levy receipts falling short of covering mounting claims. The Auditor-General of South Africa (AGSA) has issued an adverse audit opinion, highlighting severe financial instability that could leave thousands of accident victims without compensation.
3min read. If it were up to you, how would you begin to address the RAF’s woes?
Lessons from South Africa’s FATF greylist efforts as the US rolls back AML law
The United States Treasury Department has announced the immediate suspension of the Corporate Transparency Act (CTA), which took effect on January 1, 2024, under the Joe Biden administration. This key piece of Anti-Money Laundering (AML) legislation required business owners to disclose corporate reports with information about Ultimate Beneficial Ownership (UBO).
How do you think a lack of transparency affects accountability? How do you see the suspension of the CTA playing out? 2min read
Industry raises red flags over tax treatment of collective investment schemes (CIS)
An article reporting concerns from all quarters of the industry earlier this year providing background to the one below which was published 6 March. 4min read
ASISA rejects proposed ‘dualistic nature’ of CIS portfolios
The Association for Savings and Investment South Africa (ASISA) has rejected as “untenable” the notion that a collective investment scheme portfolio – offered to the public as an approved investment – can later be reclassified as a profit-making scheme. 4min read
Diversity and Inclusion
FCA (UK) scraps diversity and inclusion plans
The regulator says it is seeking to reduce the regulatory burdens on firms.
Does this mean that the anti DEI wave has hit the UK shores? 3min read.
Professional women who break barriers and empower others
Historically, women have faced significant barriers to full participation in academic and professional spaces. In fields where they remain under-represented, navigating leadership takes more than expertise – it requires owning your voice, challenging norms and creating spaces where others can thrive. Inspiring 5min read
Life Insurance
Life insurance claim denied: A cautionary tale of misrepresentation
Not disclosing all the material details when applying for a life insurance policy can have a dire effect, as a KwaZulu Natal woman discovered after she had lost out on R6 million as the beneficiary of her late mother’s policy, but it had emerged that the mother did not disclose all when she applied for the policy. 3min read
National Cause of Death Validation Reveals HIV/AIDS Still a Leading Cause of Death in South Africa
The study found poor agreement between the underlying cause of death identified by researchers and the official recorded cause of death data, with only 36.9% agreement for over 15,000 linked deaths. It also revealed significant underreporting of HIV/AIDS deaths and misclassification of injury-related deaths, particularly suicides.
An interesting read, reporting on issues that need urgent attention. 3min read
General Insurance
Despite Higher Insurance Costs, Risks, EVs Are Set to Dominate Roads in 2025
More than 1,300 respondents, including charging infrastructure providers, fleet adopters and consumers across several countries participated in the survey.
Isn’t this interesting? What do you think is prompting the interest in EVs and change in behaviour? What would an EV garage need to sustain its business? Given this information, what factors would you insist on in pricing premiums and how often would you review these? 3.5min read
Health Insurance
Discovery has a massive medical scheme problem
Not only has scheme membership been broadly flat for nearly a decade (in fact, the number of lives covered by DHMS has declined by 73 000 over the last five years), but Discovery Health’s only growth over the decade has come from taking on the administration of restricted schemes such as Bankmed (in 2016) and Sasolmed (in 2024), and from non-scheme products such as gap cover.
How do you see Discovery solving its medical scheme problem? 3min read
How medical schemes are using AI’s predictive power to revolutionise health risk management
In South Africa, medical schemes including Discovery Health, Fedhealth and Momentum Health are using AI to provide personalised healthcare recommendations, predict health risks and optimise treatment pathways despite some lingering concerns about safety and reliability.
High level discussion which poses ethical and other considerations. 3min read
What’s driving medical aid shortfalls in South Africa?
Sirago Underwriting Managers is concerned about the jump between what medical aid schemes pay for health bills and what gap cover insurers fork out. 3min read
Investments
Investors’ costly habit: How behavioural biases are eroding returns
The latest edition of Momentum Investments’ Sci-Fi Report shows that, post-Covid-19, levels of behaviour tax remain alarmingly elevated. The report notes that although engagement (switch activity) has subsided, switching continues to incur more than 3% a year in lost returns. In 2024 alone, investors on the Momentum Wealth platform “lost” about R60 million in 2024 because of behaviour tax.
An interesting worthwhile read of 6min. OR, you can access the Sci-Fi report here. It is full to the brim with top quality articles which are research based and authored by experts.
The Deepseek Effect
This article assesses how Deepseek has impacted market sentiment. 3.5min read
Is ESG dead? Why Trump’s exit from SA’s Just Energy Transition (JET) is a wake-up call for SA businesses
America’s withdrawal has reduced South Africa’s total international JET pledges from $13.8 billion to $12.8 billion – a significant setback for the country’s energy transition ambitions.
Read how inaction is not a strategy, but an emphasis on sustainability is. 3min read
Growing a greener SA with hybrid energy investments
The 128MW Oya Energy Hybrid Facility, a pioneering greenfield project under development, exemplifies this potential by integrating solar and wind energy, complemented by a battery energy storage system, as a single dispatchable renewable energy power plant.
This is a live case study in point providing the business case for investing in hybrid energy. 3min read
Considering Offshore Investments? Watch Out for This Forex Trap!
It’s undeniable that investing internationally has proven to be a wise choice for South Africans, especially with the rand’s ongoing decline. However, a common oversight for those exploring offshore investments is the 2-3% fee charged by banks for transferring funds abroad.
Understand how technology is reducing these costs for Future Forex clients. 2.5 min read
Retirement / Pensions
Alexforbes pays out over R7bn in two-pot claims
Alexforbes said the claims statistics show that members’ immediate financial needs often outweigh the benefits of preserving their savings for retirement.
3min read
The two-pot retirement system could boost interest in pension funds
This author suggests that there are many good spin offs of the system but that it needs time to settle before we can predict pension member behaviour. 5min read
Continuation of insurance cover for fund members – board considerations
The fiduciary duties of the board of management (board) of a retirement fund towards the fund and its members include studying and understanding the rules of the fund and the benefits it offers. One of the aspects that may be covered in the fund rules is death and/or disability cover (insured risk benefits) offered to members via the fund. These benefits may include a continuation option available to fund members at an additional cost. 3min read
About YOU
The EQ Gap: Building on Self-Awareness While Tackling the Social Awareness Challenge
When professionals understand their own emotional patterns and feel confident in their abilities, they’re better equipped to recognize and interpret patterns in others. While strong Self-Awareness doesn’t guarantee Social Awareness success, this foundation of self-understanding and confidence makes people better equipped to develop the Social Awareness skills needed to close the gap between understanding ourselves and understanding others. 6min read
How poor sleep could fuel belief in conspiracy theories
Research has explored cognitive biases, social influences and personality traits to understand why people believe in conspiracy theories. However, such research overlooks subtle day-to-day influences on conspiratorial thinking, like stress or sleep. 4min read
Accelerating action towards better mental health in professional services – A female perspective
In 2024, the passing of Vannessa Ford, a former female equity partner at Pinsent Masons, sparked global concerns about mental health within the legal fraternity. An inquest into Ms Ford’s death showed that she passed on while “undergoing an acute mental crisis exacerbated by a number of stressors” one of which is believed to be the long working hours she endured shortly before her death. According to Ms Ford’s husband, she was wracked with guilt over missing time with her two children. 3min read