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Why Analyst/Economist Hate Talking about Bear Market ?

January 15, 2015

I am sure this note may be upsetting for all the richest class of the society and each one of them would disagree with me. But the real truth is that Analysis, Theories and Economic Logic’s are tailor made to protect the Shareholder/Investors/Fund Managers Money or else many of them would be frequently seen loitering empty hands on the roadside due to incurring of losses caused by their bad/poor decision or investment adventurism.

Why? Take example of unknown size of Derivatives,which could be nearly $ 600-700 Trillion, which is almost 8-10 size of global economy or Money injected in the name of Quantitative Easing (QE) that was actually meant for Bank Capitalization purpose and not for economic stimulation.

And to make it effective, many Economic Theories have been proved wrong. E.g, On what basis/strength money printing (QE) was allowed. If oil surged from $ 37 to $ 147 and commodity prices surged to record highs, then during this period why Inflation remained in 0 pct to 2 pct range in Developed Economies, which is laden with nearly or over 100 pct Debt and/or is faced with high Fiscal deficit.

This was made possible by ignoring some of the Key facts such as by bringing Legislative Changes, by changing Accounting Rules enabling Fudging/Manipulating or Window Dressing of Balance Sheets in the name of Bank Capitalization by using Tax Payers Money. Biggest savior was Rollover of Maturities to longer period and global rating agencies was equally responsible for not pointing and warning the weakness or the increasing risk. Even Central Banks and monitoring agencies did not bother to point the irregularities, which was auditors job. Instead the actors involved in the process were blessed with hefty packages/bonuses.

If this is considered right approach/strategy, then why educational institutions/educationist did not bring the required changes in the Economic Curriculum accordingly, as it is in negation of modern economic theory ?

What is difference between lending free money to a corporate and/or a fund manager or a beggar in many Billions/Trillions? Because in such an environment they all can produce same result. US economic recovery does not mean that the global financial misery is over, its simply matter of time until it occurs again.

With China almost done after 2-decades of over 10 pct growth. Brazil is brittle and India is no China, expect for the population, its totally different in comparison and hence, is too weak to support global economy. Therefore, unless the holes are plugged permanently, problems will remain intact and will occur more frequently at intervals from one continent to another.

This because the overall size of Global Debt/Deficit has become so huge that unless real/genuine cash money is not injected, it will regularly/often create havoc.Current fixation is only temporary.

To get back to normal business environment, Government and Central Banks/Regulators should not intervene and allow market to determine its real value, which could initially lead to more ciaos before global market settles down and is back to normal.

To get rid of all the financial market woes, some price has to be paid and for that purpose someone has to take the lead or else, Analyst/Economist & the Rich Class of the Society would continue to have joy ride at the expense of Tax Payers money with no end result.

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