Crisis of confidence? You must be joking!

October 13, 2008

Joke 1
Joe Blogger had a cheque returned last week. They said it was due to “Insufficient Funds.” Now, Joe’s not sure if they meant his account or the bank’s?

Joke 2
There are two sides to a bank’s balance sheet – the left side and the right side. On the left side, there is nothing right, and on the right side, there is nothing left!

My cell phone has been bombarded with forwarded jokes like the ones above ever since the global financial crisis started. At least some people have their sense of humour intact despite the troubled times. Some might even thank God for such small mercies.

rtr1yu4z_comp.jpgThe BSE Sensex which has been hurtling down in a merciless downward spiral for the past 8 months has seen a Monday morning surge. The index is up more than 7 pct on assurances from finance minister P Chidambaram that the government was working on more measures to improve liquidity.

But will liquidity revive the markets and restore confidence?

For its part, India’s top private sector lender ICICI has unleashed an unprecedented information drive (on TV, by email and SMS) to assure depositors that all is well with the bank.

Over the past months, the world which went flat so that business could go where it’s done best might have actually shrunk. Pundits and punters talking about the Great Depression of the 1930s as if it was a Friday movie release that was not well-received.

rtx9c0p_comp.jpgMoney which made the world go round seems to have suddenly done a vanishing act and we’re searching for answers.

The Reserve Bank of India’s (RBI) CRR cut is expected to infuse Rs 60,000 crores into the markets. This money can ease pressure on businesses which some newspapers reports said were forced to borrow from private lenders at 35-40 pct to sustain or complete existing projects, especially in the real estate sector.

Realty stocks like DLF which launched promoters like KP Singh into the global rich list have foundered badly.

rtx91js_comp.jpgBut the contagion did not stop at just the real estate scrips. Bellwether IT firms like Infosys and TCS have been hammered along with banking stocks like ICICI which fell prey to a world-wide market aversion to the financial sector.

All this despite a general consensus among market analysts and economists that India remain comparatively insulated because of its strong fundamentals and less dependency on exports.

rtx99dw_comp.jpgMonday’s rally has raised a number of questions, more so for the retail investor many of whom got singed badly.

Has the bottom been found finally?

Is this the right time to buy battered stocks and build your portfolio?

Can someone actually time this market?

We would love to get some answers. If you don’t have them, even jokes will do. I know it’s too late to laugh our way to the banks. But a smile can help, even in such days of despair.


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Have you heard this one?…

Q. What’s the difference between Investment Bankers and pigeons?
A. The Pigeons are still capable of making deposits on new BMWs’

A lame joke? What about this one?

What do you call 12 investment bankers at the bottom of the ocean? A good start…

Whenever things go trully wrong, black humour comes in to drive out the blues…

The latest market crisis had been waiting to happen for a long time. For months now, the Sensex’s return to 10,000 had been predicted but brushed aside by new investors as well as investment bankers who had not really seen the bad times and taken the good times for granted…Welcome to reality…

Posted by Real Times | Report as abusive

One should always laugh at the misfortunes. Some of the best programs have been Jay Leno and co on late night TV. The only sad thing is that they are still making their millions when small guys have lost their all.

Posted by anon | Report as abusive

What about this one-

A hedge fund manager: “This is worse than a divorce… I’ve lost half my net worth and I still have my wife!”

Posted by Sakshi | Report as abusive

Keeping In mind the current scenario of the financial market. It seems the worst is not over yet and investors who tend to always carried over by huge sensex rises like todays, should not be worried about missing the bottom. careful strategic investments are the need of the hour.

Posted by VIMAL SHAH | Report as abusive

I don’t think there is harm in putting money in 80C ELSS Tax saving fund (they have 3 years lockin period…)

Posted by arun | Report as abusive

Madhu, I loved the 2nd joke posted by you.

Taking today’s situation in mind, I’d love to hire Finance Minister for 1 month with me from 09:30 A.M. to 3:30 P.M. and request him to give statements so that market can play See-Saw. These days market is moving up-down on some statements and not on reality, which itself is biggest joke.

Posted by Tejinder | Report as abusive

The sad part of the entire story is that now days I even find it tough to laugh on those jokes. I pray either the market sinks to the lowest possible or rises to the highest imaginable. But this roller coaster ride ends!!

Posted by R S | Report as abusive

See its not about joke or some thing , seriusoly all just neglect the second part of rally mirror, and we are just facing the consicounses of greed , there no fear only greed and now no greed only fear hats of to market , it has to bounce back certainly after some hucks and chuks

Posted by Amit Daga | Report as abusive

Inspite of recession , PC says to investors : Do not hasitate byu shares. Do you know the meaning of this ?

“” Finance minister got mad. “

Posted by Arpit Agarwal | Report as abusive

It was all the bad tactics of congress led government. In the time of BJP led government, the share market was stable.
The two world known economists failed to know the trend.They are more in the “American Effect”. In januray 2008, the market touched near to 21000 mark , it was an absolute illusion created by this government. I will never vote to congress.

Posted by Arpit Agarwal | Report as abusive

Its strange. When Congress came to power the share market was at around 6000 points, and now when it looks like the Party is over for Congress the share market is coming back from where it started in their tenure.

Posted by chinmaya | Report as abusive

The high SENSEX and strong INR was based on speculative buying by foreign investors. According to me both were overvalued. The decline in both is due to taking away investment in Sahres and Securities from India. Water finds its own level.

The financial crisis mainly in USA and partly in West European Countries was due to sub prime lending policy adopted by their bankers with the flush of cash investment with them available from oil producing countries from sales of oil at very high prices. The oil producing countries have limited scope for investment for development in their own countries.

Due this financial crisis the gold prices is going up and crude price is comming down.

The financial crsis all around the world is due to globalization of economy and it would mainly hit USA and West European Countries.

Posted by Sitaram Agarwal | Report as abusive

the stock market is getting shady these days, with indexes going down and even big trading institutions losing hundreds of millions, so I wouldn’t buy my portfolio right now, neither would I sell anything I’ve got. Are we at the bottom? It’s impossible to know, usually nobody know the future, especially with stocks, but currently it’s even more less predictable. Better invest in gold.

Posted by Alan | Report as abusive