Joined: 02/Sep/2006
Location: India
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Posts: 9319
Posted: 02/Apr/2008 at 8:08am
A year ago, investors such as Guan Ling were
ebullient. Chinese share prices had climbed more than 500% in the span of two
years, setting off a nationwide stock buying frenzy. When experts periodically
warned about the possibility of a bubble, prices would dip temporarily then soar
even higher, breaking records and inciting another mad dash to snap up
equities.
“The market was going wild,” says Guan, 49, who a
few years ago closed his real estate company to invest in stocks full
time.
“Everybody was talking about how much they had
earned, how much more they would invest, and which stocks had jumped 20
times, or even 30 times.”
That was last year. The Shanghai Composite Index
has plunged 45% from its high, reached last October. The first quarter of this
year, which ended on Monday with a huge sell-off, was the worst ever for the
market.
Suddenly, millions of small investors who
were crowding into brokerage houses, spending the entire day there playing
cards, trading stocks, eating noodles and cheering on the markets with other day
traders and retirees, are feeling depressed and angry.
“These days my family quarrels a
lot,” says Zhang Liying, 55, a retired hotel waitress
who with her husband invested all their savings in the stock
market. “My husband asked me to sell; I wanted to hold for a
while. Now my husband condemns me as so stupid that we lost our family’s
savings.”
Si Dansu is even more distraught, but she blames
the government. “I devoted my whole life to the country. I went to the
countryside after graduation, and worked as an engineer in a Shanghai factory
until retirement. I invested almost all my savings and retirement fund in the
market 10 years ago. But now I’m totally penniless. All my stocks went
down.”
Other parts of Asia are as bad, or worse. In
India, stock prices have plunged 31% in Mumbai; they are off 31% in Japan and a
whopping 53% in Vietnam, another booming economy. Angry investors have
burned a securities regulator in effigy in Mumbai, and some are
in tears in Ho Chi Minh City, Vietnam.
“Some of them have cried,” says Nguyen Quang Tri,
74, a retired cement company manager who was visiting a Ho Chi Minh City
brokerage house this week. “I have my own equity, but most of the people
here borrowed money from the bank.” The market mayhem began after
concerns grew late last year about inflation at home and an American financial
crisis. Now, even though China’s economy is growing at its fastest pace in over
a decade, stock prices have fallen back to earth, crushing small investors on
the way down.
Few experts believe the stock plunge is a
major threat to growth in the real economy here. But there are worries that a
prolonged downturn could reverberate through China’s financial
markets—especially since a large number of corporations had aggressively
shifted money, sometimes secretly, to play the
market.
Investment is also buying ITC when Index was 21000
Speculation is buying HFCL , Ispat,RNRL etc even now irrespective of index level
Yes Nitinbhai, its all in the habit. When you buy with the intention that prices should dip lower so that you can accumulate more, its investment. When you buy with the intention that you can sell immediately and reap profits, thats purely a deed of speculation.
Its all about the expectations.....different people view different stocks differently. Sandeep Sir thinks HDFC as investment, you think ITC as investment, I may think something else as investment.
Joined: 05/Aug/2006
Location: India
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Posts: 3142
Posted: 02/Apr/2008 at 11:08am
Originally posted by kulman
Now, even though China’s economy is growing at its fastest pace in over a decade, stock prices have fallen back to earth, crushing small investors on the way down.
A lesson for everyone!!!
You can't make money if you are unwilling to lose...It's like willing to breathe in but not willing to breathe out. -- ED SEYKOTA ....Read Disclaimer!
Joined: 02/Sep/2006
Location: India
Online Status: Offline
Posts: 9319
Posted: 07/Apr/2008 at 9:35am
When is it a bear market?
excerpts...
You suddenly swipe your card into work at 9.30 am, coast over
the irritable desire to look at the watch at 9.54 am or excuse yourself
to the toilet at 9.55 am if only to conduct hushed conversations with a
mechanical voice at the other end
You start getting ‘great work cards’ from colleagues; seniors call you into their cabin wanting to know the raaz behind your sudden increase in productivity
You start impressing the neighbour’s daughter with the use of words like ‘planning’, ‘portfolio construct’ and ‘instrument mix’
You go to the doctor with the ‘sinking feeling in the solar
plexus complaint’ but she checks your pulse and there is nothing wrong,
she asks you to say ‘aaah’, stick your tongue out and you are
absolutely fine
Your favourite fantasy is not running around trees in the rain
wearing white shoes behind Mallika Sherawat but for some curious reason
‘9.56 am, 21 January’
You boast at a party of having shorted the market at 21,000 and suddenly the listeners drift
You start taking a perverse consolation from the fact that we
are better than ‘Gayatriben’s husband, who had to sell 30 per cent of
his inventory to pay the broker’
The children start getting the drift that the world has
changed in some way they are yet to fathom because the holiday
destination has been switched from Phuket to Puri and the carrier from
Thai International to Puri Express second class and all the parents
will proffer is a stoical ‘Paisey phainkne ki kya zaroorat’
All those people who would arrogantly demand “Will it double
in two months?” now venture to tentatively explore “Will it get back to
the prices we bought in two years?”
You stop getting cold calls – ‘Good morning Mr Patherya, how
is your day? Can we come and see you for five minutes? Send you the
proposal on the email? No, we would like to come and see you instead’ -
prospecting your brokerage business from financial securities firms
When you get a mail on Narayan Murthy’s ‘simple living, high
thinking’ stuff and you cc it to 23 people in office who in turn cc it
to 250 others, who in turn forward it to 1,563 people who in turn send
it to 12,304 people – and within 37 hours, it pops back into your mail
with an interesting addition ‘If you circulate this to 7 people in the
next hour, your portfolio will bottom out; if you don’t then the
company in which you hold stock will do a buyback and your letter of
offer will be waylaid in post’
You start having tea with friends and lunch with in-laws; the word ‘social’ doesn’t remind you of an awful waste of time
You can actually have a business meeting without sms alerts on market movements
The restaurant steward motions you to the tables closest to
the television (featuring CNBC) and you tell him ‘Somewhere where we
are not distracted please’
Experts when they find calls coming in from business channels offer their mobiles pleadingly to colleagues with ‘Please keh do ki I am in a meeting and main phone karoonga but after 3.30’
People suddenly discover they have relatives in the US who
they have not spoken to for 18 years and then they confront them with
the opening line of ‘Tya badhu barobar’
When Marc Faber predicts that the index will go down to 12,000
and in the same newspaper edition a consensus of brokers indicates an
index of 19,000 by the year’s end
When the envelope carrying the dividend cheque is treated with considerable respect
When you ask for the ‘Black Swan’ by Nicholas Nassim Taleb at the bookstore and the manager responds with ‘Kya baat hai, every third walk-in is asking for this?’
When merchant bankers tell IPO clients “You will need to leave value on the table for investors”
When an effective stress test becomes dirt cheap; all you need
is the financial newspaper and if after the 37th line of the stock
quotations page you find your pulse accelerating and breath halting,
then you need a GP
When the broker calls and you tell him ‘Aap mat call keejiyega! Darkaar hogi to main karoonga’
When your chartered accountant calls and says ‘Bhaiji, problem solved. Is baar losses khareedney ki naubat nahi aayegi’
When you invite the guy who had a big problem meeting his margin calls and he says ‘Aajkal to mein kahi baahar jaata nahi hu, sirf office and back’
When the standard escape route for every analyst becomes ‘ghatey to liyo’ and when the stock declines, they say the same
When even a casual ‘ghabraao nahi’ lifts the clouds enough for the caller to call three others and say ‘Babubhai kahey chhey hay ghabraavnu jehvu chhej nahi’ and within half an hour of frantic calling and re-calling, some 23 people are walking in a better frame of mind to office
Everyone is poorer, but bloody hell, no one is admitting it.
I think in a very simple way, you do have a valid point.
Originally posted by India_Bull
Janekjee,
Every participant in the market is a speculator by defination (Speculation is u buy or sell a stock on the premise that price will increase or decrease ) what differs is the time frame, some people have 2 days, some people have 2 hrs and for some people it is 2 or 20 years !!
The market is a place where people with money meet people with experience.
The people with experience get the money while people with money get experience!
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