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It's a Topsy Turvy (Financial) World.

Chris Rock said this:

You know the world is going crazy when the best rapper is a white guy, the best golfer is a black guy, the tallest guy in the NBA is Chinese, the Swiss hold the America’s Cup, France is accusing the U.S. of arrogance, Germany doesn’t want to go to war, and the three most powerful men in America are named ‘Bush’, ‘Dick’, and ‘Colon.

And then in the finance world you know that things are really crazy when:

Stocks Explode Higher on Fears of Renewed Economic Weakness. No really. The US market exploded upwards for the Dow to close +274 after the Fed minutes came out that said the economic recovery was not at all very good, and that the rest of the world was going to the toilet.

After years and years of keeping interest rates at record lows, some parts of the US economy have recovered. As they "taper" their quantitative easing, the market has been expecting that rates will rise. Rising rates will be bad because when you have cheap money and suddenly you don’t have cheap money, it can be destructive. People sell stocks. People don’t buy stocks. People tell their friends it’s over. The life-saving drug has become an addiction, and even the thought of some of it going away elicits a withdrawal syndrome.

So that’s why, if the Fed hints that the economy isn’t yet in the absolute best of shape, it gets met with a huge move up. If the economy isn’t great, low rates will stay for longer and then you can buy and keep buying.

These rallies are fast and furious. You can’t stand against them, not easily. At best, you step aside, and watch the market do its thing until it eventually runs out of drug euphoria at which time they inject another one and off we go again!

India’s been a little like that recently. If GDP growth is low, or IIP is low, markets rejoice, because…RBI will cut rates.

And meanwhile, banks go up even as news comes in of big coal exposures, large size defaults and potential war-like skirmishes with Pakistan.

Auto companies shoot up even as the dismal sales figures get even more dismal, because….it can’t get more worse than this.

Some news analysts will even be happy if markets crash because at some point in the past they had predicted that markets will crash and it’s not really happened.

Stocks go down after announcing great results. Stocks hit upper circuits when they sell half their assets for peanuts. When the promoter gets bail, the stock rises, without questioning why the fellow had to go into jail in the first place…

It’s a topsy turvy world.