23 march 2020
nifty : 7777
dow jones : 19160
people might be thinking that after this gigantic fall we must be near the bottom of the market. they must be anticipating a bounce.
imho, my reading of the medium term charts whispers to me that this is not the end of the bear run. the rout is not over. it is heading down and likely to get uglier. i see the "sell on rise" phase to continue till april end. the whole world of business and finance would have changed by then.
it is no ordinary bear market. notwithstanding intermittent small and medium hope bounces, it is a collapse that will result in the end of a world-order and hence will lead to a brand new order. we are heading towards a metamorphosis of the world. it is going to be chaotic and extremely painful.
while everyone is shocked and minds are frozen, holding breath waiting for the signs of the start of the end of this nightmare, it is difficult to start thinking of the possible scenario post the dust settles.
here are some likely scenarios:
* demand worldwide will collapse big time
= the recovery will be first in the essential products and services, then in the comforts followed by the luxury ones. the non-essentials will take, rather quite a long time...
* purchasing power will collapse
= one possible solution to this is to (in simple words) give everyone some money. more specifically do direct deposits in everyone's account, postpone the loan paybacks, drastically reduce the interest rates, press the accelerator on government spending (there is no dearth of projects to be taken for the next decades, just like China did a couple of decades ago), don't worry about the fiscal deficit and print money instead of worrying about tax collections, etc. though a logical and logistics nightmare for some countries, that will surely help in restarting consumption though will result in inflation. and more critically, that will defend currencies and save the banks.
* worldwide currency reset is likely to be there. what needs to be seen is what happens to the balance between the currencies. there is expected to be a big upheaval there. currencies that will survive better will be the ones of the countries which are better prepared to stage a comeback.
* serious global supply chain disruptions and damage.
= restructuring is inevitable. new supply chains and suppliers will be hunted and created while the older non-strategic risky unviable or sub-standard ones will be dumped or left mercilessly. the fitter economies and companies will win at the cost of others which will become sick or dead.
* businesses will change hands.
= while most of the business ideas will rise from the ashes, the ones to carry-up those ideas on shoulders are likely to be different from the ones which carried them before the storm. like a rugby match, the adaptors will snatch the market from those who fail to.
* fad and luxury products and services will vanish for a long time if not forever.
* get ready for hyper-inflation scenarios as currencies and economies melt and struggle for survival. hedge with gold or crypto-currencies.
* GDPs of all countries are set for a reset in time. the expected "technical" rebound for most will be an unending wait.
* new services and products and categories will pop up.
* new world order will be as per new realities.
* unemployment will go up to draconian levels threatening law and order besides leading to medical nightmare, hunger, and misery.
permanent changes are inevitable in every arena of life. the world is about to make way for a new one.
welcome to the renovation! in fact, innovation!
it is a brutal global disruption and extends beyond just money.
by the way, it is all man-made. many out there aren't surprised. in fact, they know it is all happening to a script, rather perfectly!
nifty : 7777
dow jones : 19160
people might be thinking that after this gigantic fall we must be near the bottom of the market. they must be anticipating a bounce.
imho, my reading of the medium term charts whispers to me that this is not the end of the bear run. the rout is not over. it is heading down and likely to get uglier. i see the "sell on rise" phase to continue till april end. the whole world of business and finance would have changed by then.
it is no ordinary bear market. notwithstanding intermittent small and medium hope bounces, it is a collapse that will result in the end of a world-order and hence will lead to a brand new order. we are heading towards a metamorphosis of the world. it is going to be chaotic and extremely painful.
while everyone is shocked and minds are frozen, holding breath waiting for the signs of the start of the end of this nightmare, it is difficult to start thinking of the possible scenario post the dust settles.
here are some likely scenarios:
* demand worldwide will collapse big time
= the recovery will be first in the essential products and services, then in the comforts followed by the luxury ones. the non-essentials will take, rather quite a long time...
* purchasing power will collapse
= one possible solution to this is to (in simple words) give everyone some money. more specifically do direct deposits in everyone's account, postpone the loan paybacks, drastically reduce the interest rates, press the accelerator on government spending (there is no dearth of projects to be taken for the next decades, just like China did a couple of decades ago), don't worry about the fiscal deficit and print money instead of worrying about tax collections, etc. though a logical and logistics nightmare for some countries, that will surely help in restarting consumption though will result in inflation. and more critically, that will defend currencies and save the banks.
* worldwide currency reset is likely to be there. what needs to be seen is what happens to the balance between the currencies. there is expected to be a big upheaval there. currencies that will survive better will be the ones of the countries which are better prepared to stage a comeback.
* serious global supply chain disruptions and damage.
= restructuring is inevitable. new supply chains and suppliers will be hunted and created while the older non-strategic risky unviable or sub-standard ones will be dumped or left mercilessly. the fitter economies and companies will win at the cost of others which will become sick or dead.
* businesses will change hands.
= while most of the business ideas will rise from the ashes, the ones to carry-up those ideas on shoulders are likely to be different from the ones which carried them before the storm. like a rugby match, the adaptors will snatch the market from those who fail to.
* fad and luxury products and services will vanish for a long time if not forever.
* get ready for hyper-inflation scenarios as currencies and economies melt and struggle for survival. hedge with gold or crypto-currencies.
* GDPs of all countries are set for a reset in time. the expected "technical" rebound for most will be an unending wait.
* new services and products and categories will pop up.
* new world order will be as per new realities.
* unemployment will go up to draconian levels threatening law and order besides leading to medical nightmare, hunger, and misery.
permanent changes are inevitable in every arena of life. the world is about to make way for a new one.
welcome to the renovation! in fact, innovation!
it is a brutal global disruption and extends beyond just money.
by the way, it is all man-made. many out there aren't surprised. in fact, they know it is all happening to a script, rather perfectly!
