Travelling Abroad – Do You Have To Declare Your Personal Possessions On Re-Entry?

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There is some confusion over whether to declare your laptops, golf clubs, iPads and other such valuables that you travel out of the country with.

The answer is no you don’t have to declare these items, but you do have to carry with you proof of purchase in South Africa of these goods and show it to Customs officials on request. Invoices or insurance policies are usually adequate proof for Customs.

Alternatively, you may, when exiting South Africa, complete a TC-01 which digitally captures the relevant assets. On completion, the Customs official will get you to sign the form and will give you a copy. This form is valid for six months and if you are a frequent traveller, it is bound to make your life easier.

How To Detect and Dodge Financial Scams

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“If it sounds too good to be true, it probably is” (wise old adage)

In the USA, $40 billion is lost every year to scammers. When you consider statistics suggesting that 65% of scam victims don’t report their losses (usually they are too embarrassed to admit they have been conned), as much as $120 billion could annually be skimmed from gullible people.

Scammers normally target people who are financially vulnerable (they have lost their jobs or their business has folded) or they take advantage of economic downturns where a large percentage of people experience financial hardship.

The quick con

Typically, it is difficult to fully get to grips with the scheme they sell you as the scheme’s workings are hard to fully understand. But the conmen tell you that the real issue is you will get astronomical returns and they will show you for example pictures of yachts cruising in the Mediterranean – messaging you “this is the life you will lead once you have made your quick fortune”.

Because they prey on the financially vulnerable, the conmen spin conspiracy theories – the reason you have fallen on hard times is the system has crushed you and this scheme bypasses all the financial regulation “nonsense” – and the like.

Conmen are also hard salesmen and they will pressurise you into making this “investment”.

The long con

You need to be really careful of these as you are up against some sophisticated operators. The main principle is to get assurance from people in your social circle that the scammer or the scheme is credible and achieves high returns (these people are wittingly or unwittingly part of the con). In addition, the scammers can point you to well-known financial experts who will vouch for the scheme (they typically are part of the con).

It is usually a Ponzi scheme which will operate successfully until no new funds come into the scheme. It then unravels very quickly, and the vast bulk of investors lose their investments.

Another type of scam is “pump and dump” where salesmen extol a little-known share, and this drives the price up. These salesmen make aggressive pitches to unsuspecting victims who get carried away by the upward momentum of the share. Once the share has gone way over its value, the conmen sell it short (the dump of the scheme) and the share price collapses.

Who is vulnerable to these scammers?

Strangely enough it is often well-to-do people (usually men) who are experiencing financial stress and are happy to take on risk. These people are well educated and financially literate.

The combination of factors that makes them gullible is (apart from being under financial stress):

  • Being put under pressure by the conmen (they need to get in “before it’s too late” and their friends “are making a killing”)
  • The scheme can be complex or opaque and so they rely on their intuition
  • Most of these people are decent and trusting, so they tend to believe the conmen and they don’t want to let the conmen down (no doubt the scammers are aware of this vulnerability)
  • Emotional. Greed is a very powerful emotion and can lead to impulsive decisions which you will regret later.

Sir Isaac Newton was a great genius, but he lost all his money in the South Sea Bubble scam in the 1720’s.

So before you get caught up in a scam step back and think rationally. You should also analyse yourself and if you have any of the above traits, then be very careful of any investments that are “too good to be true”.

Employers Take Note – We Can Still Learn From the Peter Principle

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“Leadership is nature’s way of removing morons from the productive flow” (Dilbert)

The ‘Peter Principle’ has been around for nearly fifty years. Recent research has underlined that it is still valid today.

It has implications for how we promote staff and the effects this has on our business.

What is it?

 

“Peter Principle, n. – The theory that employees within an organisation will advance to their highest level of competence and then be promoted to and remain at a level at which they are incompetent.” (The Free Dictionary)

 

It is usual in business that people get promoted when they are successful at their jobs. They get promoted despite the fact that very often the skills required for their new position are different from their old position. If they are successful in this position, they get promoted again and again until they lack the skills for the new position and then they experience failure. Once this has happened, they get stuck in their new role – as they are no longer successful, no more promotions are available for them. They have risen to the level of their incompetence. Most organisations are bedevilled with unhappy managers who spend years and years in the same job.

Some researchers have even facetiously suggested that, as the skills required for one stratum of an organisation are completely different to those required for the next stratum of the business, why not promote the worst performing employees?  This in Dilbert’s terminology shows that “leadership is nature’s way of removing morons from the productive flow”.

New studies prove the Peter Principle

Recent research of 214 companies reviewed 1,500 promotions in sales organisations. The research also looked at the characteristics of people promoted – whether they worked collaboratively or on their own (people who work collaboratively usually make effective managers).

It showed that people were most likely to advance in the business when they were successful in their sales jobs although they were poor managers – in fact sales declined under these promoted managers. Conversely, those who worked collaboratively were usually not promoted.

The lessons today

The new research shows that the Peter Principle is alive and well. Whilst many businesses accept the trade-off of promoting successful employees at the expense of having less effective managers, it is appropriate to reconsider how staff should be promoted in an organisation. In the long run it almost certainly pays to promote those who have the potential skills to be good managers. To the high flyers who don’t have the skills to manage, recognise them and give them hefty bonuses.

Finally, is it not better to move people who are not performing in a particular position either to another position where they can do a good job, or move them out of the company? This leaves the company with good managers and motivated staff as opposed to having frustrated blocked managers and lower performing employees.

What Will The Next Decade Bring Us?

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“If we can win the Rugby World Cup three times, surely it is not asking too much of this country to take the High Road twice when its future is on the line? When push comes to shove, ordinary South Africans can do extraordinary things!” (Clem Sunter)

The major global trends that have recently emerged and are widely predicted to continue to dominate the world are:

  • A rising tide of nationalism and anger at the status quo which manifests itself in trying to stop immigration into Western Europe and the United States, an increasing move away from free trade and more and more civil unrest. If you put all this together, it will result in slower global economic growth and rising tensions within countries and conflicts between nations (India and Pakistan, Turkey and the Kurds/Syrians, the USA and Iran to name a few).

    For South Africa, which is dependent on growing trade, this will put more pressure on an already struggling economy. Civic unrest is also a significant trend here and hopefully we can recreate the 1990s when we stunned the world by negotiating a peaceful transition to democracy.

  • Superpower tensions as China vies to overtake the USA both economically and militarily. Russia is also showing global ambitions. So far this has played itself out in US tariffs against China and sanctions on Russia, but you can expect this to hot up.

    South Africa is a long way from these battle grounds and should be spared any conflicts that arise. In fact, we will probably benefit as the superpowers vie for influence which should translate into investment into our declining infrastructure.

  • The last decade has been characterised by easy money and low interest rates, which opens the distinct possibility that there will be another economic crash similar to the one in 2008.

    This would not be good news for South Africa as our economy is already stretched by rising debt. We survived the last crash well as we had strong economic fundamentals and were able to fight the effects of the crash with an economic stimulus program but now we have no leeway to counteract a global recession, should there be a crash.

    Another factor is whether we will drop to full junk status which will be detrimental to the economy.

  • Shadowing and shading everything is climate change which has arrived and is making itself increasingly felt. Already we have seen how a disastrous drought was one of the causes of the Syrian civil war and we know how dry parts of South Africa are. Rising levels of carbon dioxide are making the world hotter (already temperatures have risen by 1 degree centigrade and continue to rise) – if temperatures rise half a degree, it will cost the world $56 trillion to deal with the effects.

    The problem with climate change is that it compounds all the above problems like rising numbers of refugees, less food etc. Desertification will drive more people into crowded cities along with more extreme weather events.

    More and more climate change specialists are saying we are getting closer to a tipping point whereby climate change becomes irreversible. Why don’t we all commit in our own small ways to reduce the carbon emissions we cause and to look to ways to conserve water?

None of our problems are insurmountable!

Although we are clearly going through increasingly risky global and local times, none of our problems are insurmountable. With will and a spirit of compromise we can achieve surprising things – nobody realistically expected South Africa to win the Rugby World Cup, but we did.