Man made disasters and man made solutions

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Euro zone Greek troubles are getting deeper as people are in panic mode. I believe these are man made disasters and can be solved by man. The paper money financial system will have its peaks and valleys over the period of time. The system was established to have more convenience and we can't be perfect at the system. It will take time for man to realize the problems and then he will fix it. Human race is growing intelligence. We build on our knowledge and move forward. Problems bring opportunities to us to fix our behavior so we could build better future.

So, the money issues in Euro zone will certainly damage the EURO in near term but it will teach important lesson to us and others. That will eventually build more sustainable financial system. Panic is certainly not the option to go with.

As far as Greek bailout, it will most probably be provided to them. We should consider two possibilities. In case they do not get the bailout money then all the stock markets will correct even more. The simple reason of this is the Dollar strength will bite into asset valuations. This is the remote possibility. In next couple of weeks, the news of Greek support would be released and then we will see sudden drop in dollar strength and gold and Euro is likely to raise.

It also means the the stock market could also raise in coming days. The best thing market did last week was just to hold on to its current level. That is a signal to us that a short term bottom is in place. This is the time when most people exit out and wait on sideline. Since the sellers are now not the part of the game, buyers will raise the quotes and demand premium from others. As sellers watch this quotes go up, they will get impatient and start buying at higher prices than what they sold out at. This will create another round of panic buying similar to panic selling what we saw earlier this month. This will create opportuties to exit on your positions and I am pretty sure that we will have another leg down after which these sellers will not be part of the bigger rally that will eventually unfold.

Please add following stocks to your watchlist

Adani Enterprises
Ajanta Pharma
Bajaj Auto
Bank of Baroda
Financial Techno
Geometric
J K Tyre
Network 18 Media
orbit corporation

some interesting news for you http://www.reuters.com/article/idUSTRE61D0ZC20100214

Thanks
Anil
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