KSE’s bulls running out of control!
Karachi Stock Exchange crossing the 13000 mark today, reaching a historical high. What are the implications? This robust financial hub of Pakistan is ablaze with activity, but is it necessarily a good for the economy in the long run? Higher stock proces and larger volumes don’t translate to higher earnings for investors. Is it mere speculation and game-play or are our companies really doing that well? Are we really growing at a pace matching that of Chinese and other Asian economies?
So many questions in my head What does everyone else think?
if a correction takes palce please don’t think the stock market crashed….. and for once just admit the change in economic conditions! what is it gonna take for all the pessimits out there to see the real picture…….
i have no idea about economics not the stock market, so.. well.. no idea
KSE is playing ground for all the punters and gamblers from around the world…
FBI’s team after tracing and chasing black money worldwide came here coz all links pointed toward KSE but when they wanted to investigate the KSE scam worth billions of $ , KSE management smartly deleted all the data to save its neck.. govt paid $1 million to financial investigators and all they said was that coz of all the deleted data we are unable to investigate anything..($1miilion gone down the drain)..
all the gamblers are investing to make quick money otherwise if stringent checks are in place like the rest of the world’s market then KSE won’t be attractive place to invest.. attractiveness of KSE is only coz you can get away with fraud easily and data gets deleted and no finger will be raised against you..
@ Turab: Im really not gonna argue with you on this present gov or its policies.
But please tell me this, how much has the economy grown in “real” terms?
i.e = how many jobs have been created?,
How many (public) assets have been created, attained?
Whats the value of the FDI’s in the Eco?
& What is the Balance of Trade of the country? (BOT is negative btw, we import a lot more than we export & Pakistan has one of the largest (in $ amount) export of remmitance in the world. Thnx to all the foreign businesses such as Mc D’s, Telenor etc etc).
I can ask a hundred questions, but for now please just answer these . ty :).
Oh & if you can, go ask Dr.Bangalwala (or is he Dr.Bangali) or any other Ecnomics doctorate (someone who knows what he/she is talking about).
They will tell you this is hog-wash.
You dont have to be a genius to figure out that our markets (Stock, property or anything else).
There are no new businesses/industries opening up & folks have accumilated cash (illicit or leagle) that they want to turn a profit on.
The ppl controlling the markets (AKD, Arif Habib etc) give this impression that the markets are strong & the ROI (return on investment) would be quick & healthy.
Ppl start buying like crazy (speculation) & the baloon keeps getting bigger…till it blows & the average investor goes broke—-ala the 04/05 boom & crash.
“Correction”. Do you mean regulation?
If the Gov was serious, it would have done that @ 8-9000 points which is the sustaining power of our economy.
What will happen will be a crash.
Sorry to sound like a bitch, but the truth hurts.
China is the 3rd largest eco in the world, exponential growth & even their markets are not gaining this fast……whats your reason for being so optimistic??
Disclaimer: Im no phd in Eco either, if you can put forward a rational & valid exp, ill happily go along :).
First, if regular folks have not gained any wealth then it stands to reason that the money being invested in the stock market is coming from outside the country.
Second, if the money is not being “invested” in the country, then one can assume that its just being put in the market by the speculators who want to make a quick buck.
Therefore, when (not if but when) there is a “correction” then the money that is being put in the market will be withdrawn.
So, given the first two assumptions above, how will that affect the common folk who have neither the money invested in the market nor jobs that have resulted from these investments?
Anything that goes up comes down. This is artificial tezi and it will come down in few days, wiping thousands clean of their life savings.
I agree with Red Munk its all BS. When the bureaucracy is under pressure they ask their punters to show a rising economy so that they can say ‘look nothing happened look the KSE is in positive’ prime example is on the Monday after May 12 – the market shot up, worldwide such disasters would have resulted in a definite dive.
A leading broker was called up early morning on Monday from all three major punters (no guesses there) to support the market. He was flabbergasted as No opening or closing market summary can ever capture the reasons why you supported the market simply based on a ‘phone call from AKD’ his daily tale is worth writing a book/blog but then would he survive long enough to trade?
bloomberg’s analysis
http://www.bloomberg.com/apps/news?pid=20601087&sid=aFoMB1dYYqA8&refer=home
world bank’s anaylsis
http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/SOUTHASIAEXT/EXTSARREGTOPMACECOGRO/0,,contentMDK:20592484~menuPK:579404~pagePK:34004173~piPK:34003707~theSitePK:579398,00.html
economist’s predictions
http://www.economist.com/countries/Pakistan/profile.cfm?folder=Profile-Forecast
KSE Zindabad..
Insider trading Zindabad…
Beware poor investors, get outta here ASAP & leave the field for the big fish to fight. Ever saw WWF/Hulk Hogan/Hulkamania? You can relate that to KSE :)
@Turab
Thanks for putting in all this effort to prove these pessimist and anti establishment ppl worng. I am sure now that their pesimism is entirely politically motivated. Cant see the other guy doing something right.
And how much do you want to bet that no one here is going to believe what the world bank/ bloomberg or the economist is saying.
C-O-N-T-R-I-V-A-N-C-E.
Well, I believe “world bank/ bloomberg or the economist” are getting the data from our government to make those assessments. I don’t think, they really do a private/impartial study to conclude their results.
I personally, believe that we are simply trying to catch up with Indian stock exchange and economic growth….and we will do anything to get there….and I mean anything!
I would only believe all these glamorous economic data when our currency will surpass Bangladesh or Indian currency.
Apart from above sarcasm on KSE, there ARE some positive news about Pakistan and it wouldn’t be fair to deny them:
http://silentdrizzle.com/newsHome.aspx
@ Ned
Dude currency surpassing will be bad, the exchange rate is being held at what it is by the SBP.
If it goes up it has an adverse effect on our international trade as it makes our exports more expensive. Exchange rate is not really an indicator of how well a country is doing. Look at Japan, they have one of the most developed economies in the world and their exchange rate is the worst.
@ Salman
good website, i didnt know abt this. Thanx
I don’t doubt the WB’ or the Economist’ numbers, rather I question the use of all this investment.
Where is all this money going? What industries are being created? Is capital spending (not government spending on infrastructure projects) increasing? Are wages increasing? How has the country’s poverty decreased? Has the gap between the rich and poor decreased?
FDI is all well and good but if its coming just for sake of parking, with an adequate rate of return, then that means that at one point when another location provides a higher rate of return, the money will flow there.
What will be left with then? Broken roads and a lot of enmity.
“Insider trading zindabad”…LOLLLL
funniest quote of the week for me.
to the revival of dada
cheers
@ CONCERNED
By surpassing Bangladesh and Indian currency, I meant our Rs will be stronger than those currencies. I don’t think, stronger currency is a bad thing for economy. Look how Euro has gotten stronger than US$. Do you think, it’s a bad indicator?
Yes it is a bad indicator and it is worse when the exports are primary products and few. You have to realise that the EU is made up of more then one nation and most have good sound economies producing more value added products.
Simply think of it this way if our currency becomes stronger then a grain of wheat will be worth more to someone in the US. If it is more then that in India (with a weaker currency) then the person would prefer to buy it from India.
Stock market is the game of BIG BROKERS, people who are using their saving are ultimately going to be the loosers sooner or later, internet has provided opportunity for every one to PLAY STOCK but wise people will make money and GREEDY will Loose.These are the DAY TRADERS who are making Quick bucs but there are sound companies where there shares are going up such as Cement, Automobile, Banks,Fertilizer and Insurance just to name a few.Timing is every thing in Stock Trading.
Well, I disagree with you. If stronger currency is a bad thing, that means weaker currency must be a good thing!! Then, why don’t we just let it devalue as much as possible. Remember, whenever, we will have a TRUE strong economy (not manipulated by Govt.), our currency value will get stronger against other currencies.