Helping You Build Wealth With Honest Research
Since 1996. Read On...

MEMBER'S LOGIN

MEMBER'S LOGINX

     
Invalid Username / Password
   
     
   
     
 
Invalid Captcha
   
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Revealed
India's Third Giant Leap

This Could be One of the Biggest Opportunities for Investors




Important: We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
By submitting your email address, you also sign up for Profit Hunter, a daily newsletter from Equitymaster
covering exciting investing ideas and opportunities in India.

AD

Is it time for Financial Crisis 2.0?
Thu, 19 Jan Pre-Open

The 2008-09 US subprime crisis led to a global market meltdown. The Euro-zone crisis is also far from being resolved. Mass rating downgrades in the region have compounded investors' fears. If this crisis escalates, the world may have to gear up for a Financial Crisis 2.0. But, this one may be even more deadly than the last. The new crisis will be more difficult to come out of since most rich countries have already exhausted their firepower. They have few fiscal or monetary resources to defend against a new crisis. Financial markets are also now unsupportive and investors are increasingly risk averse.

Even without factoring in a new crisis the World Bank predicts slower economic growth. Using market exchange rates, Bank predicts that the global economy will grow by 2.5% in 2012 and 3.1% in 2013. This is a downward revision of its forecasts in July 2011. Six months earlier it predicted that the world economy would grow by 3.6% in both forecast years. It now expects the European currency Union to see a GDP contraction and other advanced economies to grow by only 2.1%. The world definitely cannot afford another meltdown. But, on the flip side India and other developing markets continue to exhibit healthy growth. But, can this growth be sustained?

Developed nations are still the kingpins of global trade. With these countries seeing slower or negative growth, emerging market nations are not immune. They are not completely decoupled from the rest of the world. According to an article in the Financial Times, remittances sent home from workers in developed countries may fall. Banking systems in poorer countries may also be exposed to financing risks. A number of developing countries have large chunks of short-term debt falling due in 2012.

China, being the second largest economy in the world may have the capability to weather a new financial storm. However, its overheated economy and housing sector bubble are pressure points. Even in India, archaic government policies and prevailing high interest rates have stymied growth. The recovery of these two emerging giants may not be enough to save the world economy. But at least we hope that the domestic financial markets recover from the severe beating faced in 2011.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

View all commentaries | Archives

Read the latest Market Commentary


Equitymaster requests your view! Post a comment on "Is it time for Financial Crisis 2.0?". Click here!

  
ABOUT EQUITYMASTER

Since 1996, Equitymaster has been the source for honest and credible opinions on investing in India. With solid research and in-depth analysis Equitymaster is dedicated towards making its readers- smarter, more confident and richer every day. Here's why hundreds of thousands of readers spread across more than 70 countries Trust Equitymaster.

PREMIUM PRODUCTS
QUICK LINKS
POPULAR TOPICS
TRENDING TOPICS
FREE NEWSLETTERS
EQUITYMASTER SUPPORTS
  • HelpYourNGO
  • You Tube
  • Linkedin
  • Twitter
  • Telegram
  • Google Play

Copyright © Equitymaster Research Private Limited (formerly Equitymaster Agora Research Private Limited).

Whitelist | Refer | Terms | Privacy | Contact | About | Sitemap

Phone +91-9136015013

Equitymaster Research Private Limited (formerly Equitymaster Agora Research Private Limited) (Research Analyst)
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Email: info@equitymaster.com. Website: www.equitymaster.com.
CIN:U74999MH2007PTC175407

Name of the Compliance & Grievance Officer: Ms Sonal Ramachandran
Telephone: +91-22-61434003 | Email: compliance@equitymaster.com

LEGAL DISCLAIMER:
Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

All rights reserved. Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

Equitymaster Research Private Limited (formerly Equitymaster Agora Research Private Limited) (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA, Canada or the European Union countries, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.