Tuesday, November 23, 2010

Can Indian Stock Markets Be Bombed By North Korean Artillery?

Tensions are mounting between South Korea and North Korea. While South Korea went on to adopt capitalism, freedom and economic growth and creating global brands such as Samsung, LG and Hyundai, North Korea went on to become a dictatorship and rogue state. The South Korean Won corrected over 4% against the dollar.

It is a bit like India and Pakistan. While we in India, decided to pursue economic growth and opportunities, Pakistan went onto become a fundamentalist terrorist state.

I pray that there is peace and security all over the world. It is not nice, when such things happen, but why did Indian markets crash by over 600 points at a given point? Does North Korean bombing have such a great impact on India?

Directly there is no connection between the two. But as India becomes integrated with the global financial system, sentiment matters. Since quite a few months now, a lot of people on the inside had a feeling that the Indian markets had run up too much. Many time, markets simply look for triggers to rise or fall.

This was just a psychological trigger, it has not direct bearing on the Indian markets, but now gradually we will see a lot of the sentiment turning negative. Talks of doomsday will gradually return, people will suddenly tighten their purse strings, less people will eat out, people will shop for less clothes and suddenly once again the mindset will return to the time of the Crash of 2008. All assets classes, except gold and silver, will see major corrections. Stocks, real estate and currencies will all be bombed by these psychological warfare.

We can see a lot of arrogance disappearing, whenever an asset class sees people behaving arrogantly, it is a sign that the end is near. We need an end, to have a new beginning.

CWG Scam, 2G Scam, firing of ministers, a major scam involving media personalities and now finally North Korea. What people think is very powerful.

On Diwali, I had shared my views on welcoming Goddess Laxmi, I hope all of you did this by booking profits.

We are in for some interesting times.

Yogesh Chabria

10 comments:

Anonymous said...

You are one of the few people who stick their head out and share their judgement openly. I thought you might give out a buy signal given that this has very little impact on India. Maybe you have not done so because of conflict of interest with your FAMS PMS business.

rajsmusings said...

Sanjay Ji,

Bang On target as usual. We are in for some really interesting times!!
Will look forward to some special recommendations at appropriate time :)

Regards
Raja

Vaibhav said...

Just saw a question in KBC:
After which war was India left with foreign exchange reserves worth just '11 days of imports’?
Options were indo-pak(two), indo-china, gulf war-1991
I definitely thought it would have been some Indian war, but I was surprised to see that correct answer was Gulf war-91. Why was India affected by a war it did not fight? Certainly there is some material impact over the economy in case of war, not just psychological.

Anonymous said...

you have always tried your level best to get the actual picture. this article is reflecting markets in coming time. me 2 trying to control fear and greed but i am sure all happionaires will surely get benifit of markets fall again.

Do post your views as markets will move ahead from here.

Thanks & Regards
Amar

Kuldhir said...

Wowww... is the time to cash the crash approaching in near future??? :))

rajsmusings said...

Hi Yogesh ji,
Extremely sorry for calling you by wrong name in my earlier comment. I was thinking of a very nice and wise friend of mine and some how put his name here instead of yours.

Regards
Raja

DPM said...

Yogesh,
Could you please post something on Silver as you have done on Gold.

Thanks

The Happionaire™ Blog said...

Silver is a good bet. Just like gold. Times are uncertain, real estate has also started correction with the recent loan scam.

India will see challenging times in the coming few months.

-Yogesh

Kuldhir said...

Sudden downfall in market is today followed by rapid increase. Is this a time for market to crash once again?? :)))

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