The year is just beginning … Markets are down almost 10%!
Reasons given are:
- China issues
- Oil prices
- Fed & interest rates
- China – We never know what the real problem or real solution is. I am fairly confident that they will get around this problem soon. They will ‘kick the can’ for a few more years. Expect a stimulus package just before the Chinese new year.
- Oil – No one has reduced consumption. Its a supply side problem. It will get resolved, and should reach around $35-$40 by the end of the year.
- US Fed & interest rate – I heard Bridgewater CEO use the word “QE-Infinity”. Fed has no choice but to ease the money flow. So there will be more money again.
So we will be back with a small bull run again in a couple of months. The only change is that, this time, growth will be driven by US and India/China and a few other countries except Europe.
2 Billion more people are joining the global market. They want better cars, homes, smart phones, TVs, entertainment, electricity etc..
I believe Peter Diamandis’ theory of “Abundance”.
So relax, we will be back in the growth mode again.