Hearing end of the world from an optimistic person like me is a difficult thing to digest. But this is what i read recently and have been reading many of it.
https://www.scribd.com/doc/95493792/The-End-Game
There are many more such articles which talk about end of the world and about how financial markets around the world will freeze in case the things continue the way they are continuing.
Some of the things which are terrifying
- > 2 yr Germany treasury notes at negative yields.
-> 33 yr and 10 year US treasury notes at 50 yr or record lows.
- > US dollar was a few years back was considered toilet paper and is now rallying against almost all currencies in the world.
-> The speculative money going into commodities is running away with Brent crude at sub 100 and Nymex crude at 83.
-> Unemployment rate soaring across the world.
-> Industrial output and PMI numbers indicate severe contraction in China, Asia, Europe and many places.
-> Debt to GDP numbers hitting the roof in many countries and chance of a series of sovereign defaults.
-> There are so many predictions of dooms day around the net and very few about turnarounds.
Some of the craziest things i have read.
Dow to go to 400 over the next few years.
Dow Jones to hit 3000 by Harry Dent.
Gerard Celente says buy a gun to protect your family against desperate people in search of food and money.
The article i have shared above says we just have 6 months to profit from any downfall and sooner or later markets will be freezed with no shorting allowed.
Oil prices will go through the roof, Gold will be the currency.
There are very few people who write on how to survive a scare they have been talking of and even if they do hardly apply them in their lives.
Lets look into some wild and scary imaginations we need to do.
- > A human needs 3 things to live – Roti, Kapda and Makaan. So if there is going to be total hay wire you need to store food , clothing and stay in a locality where social unrest cannot occur or go buy a small property on an unknown island. ( I stay closer to Madh Island need to think on this ). By the way nowadays we need oil too so keep some barrels of crude 🙂 too as that can go crazy. Remember the 200 dollar crude oil prediction ? Peak Oil.
- > Pay of your debts is the standard thing to say. But if there is going to be a crash and freeze of markets why should i pay my debts rather take debts and runaway ( Find a banker who is ready to give you a few crores )
-> Buy Gold/Silver and Bonds - It stores your purchasing power. Well Gold will give you purchasing power but if everything is going to freeze it will mean world will go back to barter system. So why buy gold, buy a farm which produces grains. You would get something for exchange of your grains.
- > Keep hard Cash !! – First thing you do is keep hard Cash. Remember the RBI guarantees only 1 lakh of your money in Fixed Deposits. ( I can say that coz i had a hard time when some money got stuck in a co-operative banks and even when RBI took control you need to write them and beg for your money back. Finally a PSU bank did a takeover and got the money back with interest 🙂 ). So for keeping the hard cash you would need to buy a big safe 🙂 and store it somewhere safe. Remember how people ran to ICICI bank ATMs in 2008 ?. A banking system can collapse if every body removes the deposits so go be the first one to do so 😛
- > Sell your Real Estate and Business – The biggest part of the net worth for Indians is Real Estate and Business premise. In many cases its almost 90% of your networth. Does your equity portfolio make a very big difference in your networth. ( Remember in 2008 selling commercial real estate became a pain. Remember the sluggish real estate market of 1995-1998 ? )
- > Buy Put Options every month as insurance – Havent you read the Black Swan and Fooled by Randomness by Nasim Nicholas taleb and hope when indices collapse the exchanges dont freeze and you get your maturity amount 🙂
- > Google on 2012 mayan calendar and how to survive it. There are lot of gears which will be sold to you. Buy a few of them like a Cold Weather Jacket 🙂 and so on.
There are lot many things which you can do. Mind you if it crashes the Banks will be closes, Jewellers will shut and everything hay wire with social unrest.
So if its gonna be so bad and we just have 6 months why the Hell to worry. Enjoy life go spend shit loads of money you have saved and maybe that will pull the economy up 🙂
Remember US doing the same in 2008 they opened their banks with free money gave free vouchers to citizens and increased spending 🙂 and bang they are alive for last 4 years and Dow Jones has doubled from 6500 to 13000 🙂 It seems now its time for Europe to start printing money 🙂 as thats the only way out else every other way leads to terror !!
Meanwhile any one who tells you Globally things will collapse, Grexit, Spainshit, Portugalistic , Sovereign defaults, Bank runs ask him whether he has done at least two of the above logical steps ? If yes he believes in what he says !! I like Gerard Celente who said buy a gun 🙂 everyone else is just trying to profit from the scare.
Anyways i continue to remain optimistic for the future , Markets, Finance and World finds a balance to survive and Mankind too:). On the market crash i am already down 15% 🙂 so its already a crash 🙂
No Situation is Permanent. ye waqt guzar jayega 🙂
Enjoy your weekend,
Regards,
Nooresh
June 2, 2012
Nooresh
This terrific thought came to your mind on Sunday and that too the very first Sunday of the month…..too bad 😛
June 3, 2012
Hi richa,
Bad times make you sarcastic 😉
June 2, 2012
Hello Sir,
what do u have to say erratic movement on Gold, Ideally If we get a negative or bad data from the US, it should strengthen gold, it happened yesterday, however, i have seen gold sell off recently even if we get negative economic data, from the US. The volatility on gold has become quite absurd..
June 3, 2012
hi ashutosh,
its all about money flow. Till few months back gold was a safe heaven for a market scare now it is not that much. The trend remains sideways in a big range for now maybe for few months.
June 2, 2012
Very well said.. ye waqt guzar jayega.
Hold tight and sit on cash till Nooresh sees light at the end of the tunnel 🙂
June 3, 2012
Cant deploy at the bottom. We have deployed a bit early. You can take your own call. Unless you have the wild imaginations then keep deploying your cash.
June 2, 2012
Hi Nooresh,
Will it be good to start buying in small lots when there is a scare everywhere. What is your view on buying 20 shares of AB Nuvo per month i.e. buy 5 shares 4 times over the one month of june and july?
KN
June 3, 2012
Absolutely provided you have patience to tide the tough times in the market.
June 3, 2012
hello sir,
What an article u had written. just go through the video “the day after the dollar crash” as u rightly said waste paper to dollar now is the safe haven. sir perceptions are such that there is no tomorrow. and yes after this disparity and apathy the amount of wealth creation will happen is only known to the people who have gone through these time. “Tough Time Never Last Tough Man Do”. its easy to be bearish this time. cheap valuation and good news never go hand in hand its inverse. its very easy to to say buy when every body is fearful but who is buying its easy to repeat the wisdom words but not easy to implement. thats why handful of people are rich in this mkt. who are implementing.
June 3, 2012
Hi Nitin,
These are tough times in all businesses. Markets tend to react first and said to be 6 months ahead so lets believe things would get better. Right now betting on equities is tough unless one has a long term horizon and can see a 20% cut
June 3, 2012
Night is the darkest just before the dawn and i dare say we are in midst of darkness but historically we have seen a new emergence from many such situations. With Brent below 100 after not one but 3 QE 3’s, it tells you that commodity bubble has to burst and all this is +ve for INDIA which is essentially a comsumer of commodities.
I for one am hugely optimistic on EQ for next 2-3 months as once in a decade opp for making mega returns. Remembering 2001, 2008…. HISTORY REPEATS ITSELF.
Buckle up !!!!!
June 4, 2012
Yes in adversity lies opportunity
June 4, 2012
Nice article. When I look at the figure 15% down, I get confidence on my Portfolio of investments. Thanks Noorish, for giving me such a strength and confidence in being optimistic.
Anandha
June 8, 2012
It is an interesting analysis of if, but, fear, optimism, escapism, intelligence and imagination. I found one interesting thing in your analysis where people start finding alternatives in their own way and feel as if they are the only people with right thinking. We can’t accept everything nor we can reject everything.
We have to be open to new opportunities that may come up with new changes which are expected in coming days. We have seen from history where debasing(Keeping value same by reducing its contents) of currency has been happening since long period;
currency debasing:
a) Currency with pure gold
b) Currency with reduction in purity of gold
c) Further reduction of gold content and introducing silver
d) Reducing silver content in currency
e) Than came currency in the form of other metals such as copper, bronze, nickel etc.,
g) Currency in the form of paper with different value printed on it
h) Currency in the form of plastic with different value printed on it
i) Latest which has been widely accepted is currency in the form of debit, credit, travellers card
j) Paper coupens such as sodexho, ticket etc.,
k) mobile money and so on
Now latest of all is currency trading which allows a person to trade in derivative asset which is derived from asset called currency (I am wondering till date how a common medium of exchange could be termed as an asset and derivatives are allowed to trade on such asset and also new exchanges are setup for trading in currency derivatives)
If you see the change in order of its happening we can expect anything to happen as we are able to see virtual currency as a reality. I don’t deny any of the possibilities that have been discussed but question called TIME OF OCCURRENCE? is difficult to answer.
As a fundamental rule “one’s loss is others gain”, Indians could be the biggest gainers as we have parallel economy with black money which takes care of any unimaginable adversity. If good things happen black money will come as a good investment if bad things happen it will come as a survival money. In anyways we will be in a better position with new rules for financial game.