It’s different this time ……..Time will only prove it !!!!

One of the economist said that Stock market has short-term memory. We, at Pentagraph, truly believe in his statement.

Financial media says that it is different this time. It is difficult to come out from this local as well as global mess.

Lets study some past event and compare it with present event with some parameters.

1996-1998

  • Drop in GDP growth by 4 %
  • High Inflation
  • High Interest Rate
  • Sovereign Default – Russia , Mexico
  • Contagion in East Asia
  • Collapse in Financial Institution – LTCM
  • Govt Action ( Pokhran )- Drying out Foreign Capital flow

2008 -2012

  • Drop in GDP growth by 3.5 %
  • High Inflation  – 8 to 10 %
  • High Interest Rate
  • Sovereign Default – Greece , Portugal ( Now Spain is making a news)
  • Contagion in Europe
  • Collapse in Financial Institution – Lehman Brothers , Merrill Lynch etc
  • Govt Inaction – There is actually vast list but mentioning important ones .. Removal of Diesel/LPG subsidiary , FDI participation in Retail / Aviation / Insurance etc .

Investors know the past events and returns delivered by the market post events . But…. short-term memory .

We don’t know when the market recovers , what would be the future returns from market . We don’t  intend to predict anything .

But , We follow the advice given by Invetsor Guru –  Sir John Templeton.

“ Bull markets are born on pessimism ,grow on scepticism , mature on optimism & die on Euphoria”  

Pentagraph believes that we are somewhere between pessimism and scepticism.

 

5 thoughts on “It’s different this time ……..Time will only prove it !!!!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s