I wasted a lot of time and energy in 2016 keenly following the general election process. At the end of it all nothing really changed in my pocket. We got a new group of political leaders in Parliament who have not yet reduced my taxes (Pay As You Earn and VAT.) I am still paying over 50% in taxes every month. I didn’t not become wealthier after the elections. Some of my candidates won. Many lost. And the world moved on!!!
This time I am a bit wiser. I intend to make more money in the 2021 elections. While everybody else is clamoring to get elected I will be smiling all the way to the bank.
There is an interesting trend I have noted. Towards elections interest rates usually go up. This is exactly what happened in the 2016 and 2011 elections. Inflation also usually goes up. The explanation is quite simple. Uganda is a relatively young democracy. As we have seen in other countries if not well managed things can deteriorate into chaos. This is not good news for investors. Investors feel it is too risky to invest around this time. So they withhold their money and watch the space. Elections in Uganda have been monetized. It is hard to win an election without spending significantly. This means that there is a lot of money circulating in the economy around elections. This causes prices to rise hence inflation.
The withholding of money by investors and the increased spending by political actors causes the Bank of Uganda to raise interest rates to stabilize the economy. Here lies the opportunity. In 2016 interest rates reached 25%. This means if you bought a Treasury bill or bond at this time you would earn 25%. So if you had invested 100m you would earn 25m in interest per year. The opposite is true as well. If you had a loan around 2016 you would have seen your loan repayments increase.
This trend is likely to repeat itself in 2021. So my strategy for 2021 is simple. I plan to invest about 200 million shillings in Treasury bills/bonds around November/December 2020. If interest rates reach 25% I will easily earn 50m shillings per year in interest. I am slowly accumulating this money through my various investments. I will closely monitor the interest rates. And if my prediction turns out accurate I will invest heavily.
See it is easy to make money!
PS: If you want to make money in the 2021 elections please join us next Friday 25th October 2019 starting 6.00pm at the Roots restaurant on Akii Bua road next to Nakasero hospital for our second MONEY TALK. The theme of the MONEY TALK is “Investing your money safely”. Our guest speaker will be Susan Namaganda who is the Head of Operations at Crested Capital. Susan handles most of my investments in Treasury bills, bonds and shares. She has a wealth of information on capital markets and other investment options. Participation fee is only 50k per person. Please inbox on contact us on 0788 437543 to confirm participation as slots are limited to only 15 people.
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