" Realists do not fear
the results of their study."
—Fyodor Dostoyevsky
(Russian, 1821-1881)
(Russian, 1821-1881)
Word for the day
Uxorious
(adj)
Doting
upon, foolishly fond of, or affectionately submissive toward one's wife.
(Source:
Dictionary.com)
Malice towards none
Who is
bigger enemy of Congress Party?
(a)
Manishankar Aiyer
(b)
Rahul Gandhi
(c)
Digvijay Singh
(d)
Salman Khurshid
(e)
Other (Pl specifiy)
First random thought this morning
Amir Khan enjoys a serious love
hate relationship with right wing activists. First came Sarfrosh (1999) and
Lagaan (2001) - Amir was a top nationalist and patriot. Then he decided to sit on
dharna with Medha Patkar Narmada Bachao Andolan during promotions of Fanaa
(2006) - he was suddenly an anti national, obstructionist and traitor. With 3
Idiots (2006) - Amir again became a youth icon, everyone wanted to emulate
Rancho. In 2014 PK made him blasphemous. His decision to share with public a
byte of his bedroom talk with his wife has now turned him a top rated traitor.
In the meantime he has made a lot of people cry with him on his TV show
Satyamev Jayate.
Quite a roller coaster! What
the heck!!!
Shaken not stirred!
Post Paris attacks, the hostilities in Europe are rising by the
day. This is developing into, inarguably, the largest geo-political crisis
since Iraq invasion led by US led allied forces in 2003.
The economic data in US is encouraging for Fed hawks. December 4
non-farm payroll report (NFP) is widely expected to provide final thrust for
the eventual Lift off on December 16. (see
here)
The recent report of virtual crash in Australia's private capex
(long considered a proxy to Chinese hunger for raw material) suggest that
despite all assurances, all might not be well with China. (see
here)
These three factors may be sufficient to stir a perfect storm for
global markets in next three months, likely causing sharp correction in almost
all assets, and a deep cut in risk appetite.
At this point in time it is rather difficult to assess the
potential damage as the conditions are quite different from 2008. For example
consider the following:
·
The market participants are more prepared and
well bunkered for a disaster as compared to 2008-09. In 2008 the storm struck
when most participants were drunk and partying in the open.
·
The central bankers are much more experienced in
handling the liquidity crisis as compared to 2008 and perhaps enjoy more
credibility insofar as disaster management capabilities are concerned.
·
The global economy is much weaker after a
persistent struggle with deflation for over five years.
·
The global economy is estimated to be burdened
with over US$200tn of debt, a large part of which could be perpetual and may
never be repaid. QE may therefore not be as potent a weapon this time as it was
in 2008-09.
·
The engine of global growth in 2008, viz., BRIC,
is out of steam and perhaps backfiring.
·
The political cooperation seen during 2008-09
may not be seen in 2016 due to a variety of reasons.
·
The disaster will impact much larger governments
as compared to smaller PIGS in 2008.
These thoughts do shake me but I am not stirred. I continue to
believe that the world is not entering any major war. The threat of ISIS in its
present form may get neutralized sooner than later. US liftoff will be smoother
than most anticipate, much like tapering. China perhaps has already landed
hard, though official data may not admit. Commodity super cycle is over and
prices may hit the rock in next few months.
For me the recovery in Indian corporate earnings is the foremost
concern.
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