Well, after my so called schooling is over and entry into commercial world, my interface with my old buddies has gone down significantly, it is not only the same case with me rather, its with them too, every one is relatively busy now a days for their bread and butter but buddies are buddies, they will never give up to disturb you, Yes, we do often meet on Saturday and Sundays in general, little bit hook ups, old nostalgic memories, movies, fight, quarrels, leg pulling and at the end “The Successful weekend “.
Few weeks back one of my friend brought us an movie called “Inside Job”, it was more of an documentary movie based on recession and the reason for it, Yeah, I was quite heavily interested cause it has to deal with my ex-firm’s massive capital loss when they enter into FICC market, I was a part of Market Risk (inclusive of FICC and Equity) and the VAR. To be much precise we were the one who pulls the rating from Bloomberg and rates the securities and Bonds, as the market indicates that all over whelmed ratings to the securities and bonds brought the market under crisis, so I was wondering if I had been part of that in any way, but no, not at all, nevertheless I wanted to know where exactly things went wrong?, where was the gap? How did we rate them AAA which are not even worthy of B +. Well, it is not our mistake but of the credit rating agencies and the market also confirmed the same.
This mistake or you may call it as negligence has caused the world economy a real booty shake, The real time chaired people, senate has brought many of the things under umbrella of gray, among them some booked there profit and some were became just an messenger and viewer of financial massacre of economy.
I have couple of near ones who are also in those firm which were in the audit firms of the affected ones and some who deals in market or financial research, I was shared a lot about recession, everyone has there own opinion about the current market, so do i have my own view when I see the market and I believe what I see but when I hear about the coming market, I don’t know. but the talks made me restless, I started researching on few and base notes to see if everything is settled, I’m quite sure and the status also shows that market has started coming out of the shocks, investors have stopped turning their back and are getting open toward the investment, now here I’m talking only about investment banking but when I turn my view towards the same CDO”s and much more to deal with the CDS”s, they still bother a bit, I’m not an economist or an expert to comment on it but question is are they settled?, will they?, question is more interesting when we hear the current news about US debt ceiling, US has raised there debt ceiling 40th times but with a good jerk to the globe, well its common for every growing nation specially with the country of highest GDP and consumption ratio. This news has shaken many of the nations who in real means depends on the US and its imports and exports, now here we have the great sufferer Mexico, China and France, we have heard a thousand times if the market is affecting the China then we are heading toward the big problem cause they have designed there growth in some of specific means, but can we forget the impact over Chinese manufacturing market during 07-11 time…, well I doubt.
US has become the centre hub for all economy, a sneeze of it makes pain to many, now when the dollar rate has gone through n numbers of fluctuation, US Ceiling crisis, pretty old CDO’s and CDS’s unsettlement, Current futile judgment of Standard and Poor to the US long term debt, global oil prices and what not…are they not symbolizing to some storm, well, why I’m saying is the only reason that when I was in school I learned about the PLC, where in the every product has to go through there life cycle from –ve to ots peak and its peak to its decline, when the product reaches its peak it has to go through the period called “rejuvenation” , this phase of life gives him the good jerks and a little time for its sustainability then the products life starts falling back to its zero. If the firm has some alternative then its all fine but here in the case of global economy, the economy has full fledge depending upon the US economy, no doubt the day it collapse, we could see the tsunami of recession, last recession has made the people of united states to work longer to pay there debts, if the citizens of the country who has this position then what about us who majorly depends upon the there outsourced assignment, whether they are IT, ITES, KPO, BPO’s etc.Are we sure that the Dollar should be the Global reserve currency?
In general in the financial market we do say as, any thing coming from the housing market is good when it’s good but worse when it’s bad, this is what we have seen worse in the 2007 to 2011 Q’s. Now the concern is, I was reading an article saying "Home prices are starting to sag again under the crushing weight of foreclosed properties," I wonder what should I predict more, a blood bath? The securities and Bond market are with their blunders,
Oil pricing has grown drastically high that expert says "In the short run, the risk is from the oil sector. If oil prices top $125 [per barrel] and stay there for about three months, then the economy will have a mild recession "Consumer spending will take a hit, followed by the capital spending plans of businesses, which will be cut back, leading to a recession."
Well let’s talk about our concerns, when we turn to investment banking this sector has already been hit so hard that a single stone can make a huge injury, sector has not come out of Lehman Brothers, HM shocks. Asset managements are holding there nerves and trying to at least maintain there AUM, they are not thinking about the revenue but the sustainability of what they have, Revenues? They can follow later times. "As the economy starts to recover and the government begins to tighten monetary policy a little bit, we are not sure there's enough capital in the financial sector at the moment to support robust growth,"
One of the reason for the financial crisis is the deregulations, now take an example, you kid is being asking you a rs.100 a month and it has never been tracked by you that where the money is getting invested, if at all in good reason and its worthiness then with what ratio and threat in a simpler means, there should be a governing centre (I.e., you), are the basics right. The 40 years of booming economy of US has made many of the product gone through the deregulations, A market was global, immense amount of exposure, nobody bothers for the regulations when revenue is falling under the feet, its all good for the short term but when we are talking about the long term then are this methodology are right? De-regularized of collateral debt obligations and unsafe credit default swaps has played there role lately, now see where we are standing now, on the bunch of ashes, are we regularized yet? I wonder if the answer is yes, I don’t know on how many products? How many more are to show there real face in coming time.
Big nation are big due to there their immense amount export +ve spins, US has that, but when it shakes, what is next? It should be noted that with the exception of India India
To be much more precise when the market hits, firms looks for its own safety, in our words we call it as cut offs, less spending. Now the new alternate is leasing or shifting to the low cost occurring location, till now india
It all looks horrible, a nightmare when I think about what’s next in career, hope fully everything goes fine, I don’t want to scare anyone of you by above writings and it does contain only what I feel in personal, the blog is solely on my personal opinion base, it can be a perception, so please don’t take anything as standard.
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