Recession

Last Christmas, with the stock markets round the globe at peaks, BSE SENSEX Crossed 20k! , and the economic situation of the world looking very bright, everyone was in the mood of partying and having fun. Exactly one year later, things changed drastically. Markets plummeted down, SENSEX fell to a low of 6k, and job scenario looks rather insecure.
Many, unlike a few who follow business news regularly and are actually a part of it, might not know the real scenario behind this downfall. There are plenty who feel the reasons are subprime crisis, fall of Mortgage in the US etc , but the actual cause , I guess only a few know(Not that I’m one of them :P).

But, one thing is for sure, an open secret, the real culprit for all this, about which we have heard stories and were told at avoid it from our childhood, but still many posses it, is – GREED. Yes, it’s as simple as this- people were greedy and now are repenting.

I’m not talking about just one person, a group, group of companies being so. Its about all. People took loans and credit which they could not afford to repay. Banks had given it to them thinking they would get a lot of interest and with promoters, investors and financers, at their back; they wanted to multiply their profits. Those who were backing the I-banks and Companies, felt they were doing great business and thus supported them and poured money on them. Companies, around the world, invested, promised, employed and crossed their limits.

Everything was looking goody- goody and everyone was happy and expected a lot in the future. No one knew that they were actually standing on a sheet of ice, thinking it to be an unbreakable glass, and trying to reach the sky. What would happen when the ice reaches its threshold? It breaks and all the people standing on it would fall deep into the water. This is what happened, when the world markets reached their threshold, with people working on virtual business and its profits, they fell and everyone suffered huge losses.

So I guess, in future, before trying to reach for the sky, look where you are standing on, a glass or a sheet of ice. Not that I’m telling not to invest, do it, but securely.
I’m here to not to pinpoint at the reason or provide a solution to the existing recession and how world economy can come out of it (to be frank, I have no idea of them), but to provide a broader and general perspective of what had happened, so that next time people will be more cautious in putting their hard earned money expecting huge returns. And those who are in power like Government, SEBI etc can actually avoid this situation by regulating the system.

Still, it is said that there is always light at the end of the tunnel. It’s a different question of how long the tunnel is, time only will answer that.

(NOTE -: The views expressed here are completely personnel and may be different from the actual Facts.)