At the time of penning this article, chaos has erupted in many streets of KwaZulu Natal and Gauteng as protesters and looters inundate our social media platforms with their violent actions. It’s not the most promising start to a third-quarter that we have experienced in recent times, but in this new crazy world, one has come to expect the unexpected.
Speaking of unexpected, I was pleasantly surprised, if not slightly irked, that my teenage children had more knowledge than I on the topic that I am about to share with you. I was waxing lyrical about the similarities of a 14th-century emperor and Elon Musk. Mansa Musa was the tenth emperor of the Mali Empire in the 1300s. Musa’s wealth came from trading in salt and the substantial gold deposits he had accumulated in his empire. All three of my kids had encountered Musa in their respective school curriculums and were not hugely impressed with my supposed superior knowledge of history.
Be that as it may, I searched for more information and read a fascinating article by Khulekani Magubana in fin24. He draws parallels with Mansa Musa and Elon Musk, our very own Pretoria-born American tech billionaire. Both incredibly rich individuals have made all kinds of unpredictable and impactful waves in a relatively new market. Historical recordings state that Musa embarked on his Hajj pilgrimage in 1324. During his journey, he travelled with a caravan of 60 000 people and gave away so much gold in the cities that passed on the way to Mecca that it caused the value of gold to fall. It did not rise for 12 years. Some 697 years later, Musk (worth more than $151 billion) has influenced the price of cryptocurrencies, Bitcoin in particular, with his comments on social media and subsequent buying or selling of the cryptocurrencies depending on their value at the time.
Efficient Group Economist, Dr Francois Stoffberg, said the comparison between Musk and Musa was apt in the sense that both were extremely wealthy individuals whose influence over a finite commodity had a profound impact on the economy they functioned in. Stoffberg says that it’s a fair parallel as gold wasn’t in such high circulation in the 1300s, and cryptocurrencies are not in high circulation today. Stoffberg did state that the one crucial difference was that unlike the decade it took the price of gold to recover in 1300’s Egypt, if one individual owns many coins and a dump of coins causes a fall in value, the system can self-correct quickly.
I am a passionate history scholar and a firm believer that if we only paid heed to the lessons of the past, we may be able to deal with the challenges of the present. If you enjoyed this economic tale of Musk and Musa with its historical twist, then I would encourage you to read the reviews and perhaps even obtain a copy of a book entitled “Our long walk to Economic Freedom-lessons from 100 000 years of human history” by Professor Johan Fourie.
Please take care during these turbulent, yet historic times.