If you were looking for an exit opportunity from the stocks that you bought last fortnight, tomorrow is the day. This euphoria will be short lived and the rally will end with a whimper. Remember Isac Newton? he said "October is the worst month for stocks. The other months are December, April, March, January, May, June, July, August, February, November and September." All bail out drama will last for a while and then once short selling is allowed we will be back to the old meandering ways of the market for a while, at least till the middle of the next calendar year. We can expect the performing markets/ companies to be separated from the "also ran with doles" my the middle of 2009. I foresee a long and treacherous bear phase for the markets.
AIG being taken over by the federal government means a lot to the industry. I have been getting calls about the future of AIG and my stock answer is that there is no bigger person on this planet than the President of US of A to own a business. In India we have a peculiar scene, TATA group the most trusted group has a joint venture with AIG (now the property of the federal government). IRDA in India has water tight investment rules and thus, there is no cause for concern for the insurance policy holders.
So, where do we invest in India now? of course the Infrastructure sector because that's where all the money is going. if you want to buy a stock and forget then buy reliance infrastructure limited keep it in your demat accounts and forget about it for a decade. It will finance all your dreams at the end of the decade.
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