Where the market goes..

Liquidity, you crazy crazy drug that fueled the mother of rallies since March, when does thou disappear?

Since Mar09 most benchmark indices have doubled across all geographies. The main reasons attributed to this sudden rally has been liquidity. Central banks in their quest to encourage growth have made money cheaper and more accessible. Some of this has paid of and signs of growth are visible. The dilemma that Central banks now face, is how to structure the withdrawal of this liquidity without hampering growth.

In my mind, the market just realized that you cant fall of the floor. Sometime in march the market felt we were at rock bottom and going lower wasn't an option. But the impact of this realization has been rather startling, a one way rise to current levels.

Now the next question that comes up, is if this rally is sustainable. The global growth story is still hazy, the U.S. and Europe continue to grapple with issues they haven't fully understood. This leads me to believe that maybe being patient with your cash would be a good option.
The critical issue is whether the market will sustain without liquidity and higher interest rates.
Only the central banks know when they will reduce the morphine dose..

A Little Bridge

Each year a fresh batch of business graduates step into the corporate world. New ideas, high zeal and a sense of purpose not witnessed since Jawaharlal Nehru's 'tryst with destiny' speech. The fundamental quality of over confidence rides high over any sense of rationality.

The situation changes drastically once work begins. All the illusions of acquiring companies, rolling out businesses and expanding capacities are shattered into pieces. Realization sets in, that to do all these activities one needs to spend time on the ground. The planes of reality are significantly different and challenging. The discomfort in the grind consumes a few, who move to cooler climes like migratory birds.

This a big dilemma, as you cannot stop people from dreaming, at the same time work on the ground level is important. So the best solution is to connect these two little islands of reality and idealism. And here is when the little bridge of phased induction makes life comfortable.