Wednesday 11 January 2012

2012 - Reforming the Status Quo

No wonder what the Mayan Calendar says about the world coming to an end in 2012; no wonder what the economists or trade pundits predict about the economy; for common men like me 2012 marks the beginning of reformation. Strange ?! Let's retrospect as to how the year 2011 ended...



  • The INR faced the wrath of the appreciating US Dollar, with the exchange rate touching to an all time low of around Rs.54/- per $1 - thanks to the phenomenon of the Debt Crises and Arab Uprising - investors started to withdraw their money from the stock markets.
  • Share markets becoming bearish, touching the 15000 mark as the year ended with the Indian GDP rate falling to 6.9%.
  • Inflation - the contemporary economic witch (daayan).
  • Gold touched an all time high of about Rs.29,000/- with prices still hovering between the 25k-28k mark - thanks to the lost faith in the USD time and again.
  • The Indian polity's worst year in the recent past - FDI in multi brand retail (yes/no); corruption (yes/yes); profits to the Swiss Bank(many folds); downgraded politic games (yes/yes).
  • Rising fuel prices - blame it on the Arab world.
  • Hovering fear of another Global Recession !!!
The world economy has faced its worst fears in 2011 and the last point is enough to throw light on the state of affairs of the world economy. We entered 2012 with almost all of the aforesaid points still making their presence felt.
If this was not enough; some economists predict that the INR might touch the Rs.60/- per $1 mark by March 2012; and the share market falling to a new record low of 12000.

No matter what the world says; the "dear optimist" still believes in the theory of the BUBBLE. No one can really predict where an economy might land as time passes, but one thing that one can surely tell is that an ever inflating bubble will reach its limits and ultimately burst.

Here we are talking about "Bubbles" - the extreme points of hopelessness in an economy that 2011 witnessed. The "bubbles" have been inflated to the extremes - what next ?!
What goes up, comes down; the "bubbles" have reached their limits and the optimist predicts that the market will soon begin to normalize naturally. High prices, down markets will revive their status quo and mark a new beginning. 

Though the actual prediction is still impossible, but this post can at least make the reader a little hopeful about the near future.

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