Recently Warren Buffett, one investor I follow, respect and admire, said that America was going through a recession. Personally I do agree that America is headed for some tough time ahead, not just because of economic mismanagement, but also due to the ongoing war it is engaged in. There are lots of hidden skeletons which are going to be unearthed soon. A few of my sources who are working with some of the (supposedly) world’s best financial institutions have confirmed my fears about America.
Institutions which have always been held as the gurus of global finance are soon going to be headed for very difficult times. The losses which have been made are much higher than people can imagine. The main people who are going to be affected by this are American and other European institutions.
I do agree that America and even places like Europe will see a slowdown and challenging times. But is this really a global recession? Is every other economy headed towards a depression?
China, might be affected, as exports do contribute to a large part of its revenues. A few other countries that are dependent on America for exports might be affected too. But fortunately or unfortunately India still isn’t really a major exporter. People might say- we do export software, but today the Indian economy is not just dependent on software. And lately Indian IT companies are expanding operations away from software exports. With the domestic economy booming, India needs more software to support business. Many IT companies are in very good shape to capitalize on domestic IT demand.
Today India is at the same point at which China was 10-15 years ago. We have just started out our economic progress and are still have a lot of growth potential ahead. I am confident with millions of wonderful people like you; we will make our dreams turn into a reality. In the short term, the Indian stock markets might face some volatility, but I can assure you that the actual economy is very strong and growing.
The stock markets don’t always imitate the real economy in the short run. Maybe a few foreign funds/FIIs remove money in the near term. But eventually a lot of money is bound to come from retail Indian investors and also global investors later on. We today have some of the highest saving rates in the world.
An America going through recession, might affect the stock markets in the short term and few exports, but it is not going to hamper the growth India is witnessing. Yes certain stocks which might have had speculators inflating prices, would correct. But companies which have fundamentally strong businesses are continuing to grow profits.
I assure you that if you have an investment horizon of at least 3-4 years you will be glad that you invested in India, provided you invest in a company or sector which is not just ‘hot’ but fundamentally strong.
One of the secrets to successful investing and creating wealth, is to invest when people are selling in a panic at depressed prices. People who panic and do ‘distress’ sales don’t care whatever price they get, as long as they get something. A smart investor will make the most of such opportunities and buy when very few buyers are their in the market.
The value of your money suddenly goes up, when demand for a certain stock or asset falls. Thankfully this year we are going to have several mouth-watering investment opportunities thanks to an American economic slowdown. I am an eternal optimist and like looking at the bright side of everything. In fact several American assets are soon going to be purchased by funds based in the Middle East and Asia. Citi Bank already has major shareholders who are Middle Easterners. Some of the West’s largest and best known brands and companies are soon going to change ownership and this trend is just going to rise with a change in economic balance. As history has proven, no super-power ever remains a super-power for ever.
Let us make the most of every opportunity and as they say make hay when the sun shines.
Happy Wealth Creation!