In times of turmoil, everybody looks towards the Leader. In his/her absence, it becomes difficult to make sense of what is happening and what needs to be done. In the financial world the 'value' leadership is end and the new leader is yet to emerge.
So, it seems the times are chaotic not because there the things that are happening, but because, a strong leader is yet to emerge. In this era of collective leadership, the figure one needs to look towards is not an individual anymore but a sort of financial wizardry which may come to rule. In the Financial Institution setup, which works in a methodology of its own, the ordinary investor, is yet to find guidance in these troubled markets.
On on 12th June, the sudden spurt in both the indices, BSE Sensex an NSE Nifty was only due to creation of value, according to experts. The values could not be sustained even for a day and therefore 13th June, 2008 saw a chaotic day at the markets. If the markets keep on behaving the way they are presently behaving, then it is time to visit the whole theory of 'Value' and 'Value Investing' once more.
On the charts, the 200DMA has been broken only the 500DMA remains to be broken in a persistent manner. That may also happen. This may signal a significant trend for the market to form in the future. If Oil, commodities and exchange rates of currencies keep the whole trade between countries at gun point, then the larger gain from globalization and the efficiencies from it will have to be recast in light of global trade experience.
Coming back to the value Concept, I would like see things, change. First, if the concept of value becomes widespread and individual and companies embrace it totally, the the upside to gain from it diminishes. Something else has to to replace the value concept in the market. As presently the new concept is still to take shape, only trading and timing of trade will keep us earning those extra value for the money we invest. So choppy markets will continue and I wait for that new concept of value to emerge.
