Liquidity distorts. Stay cautious
“Things always become obvious after the fact – Taleb.”
Short-sightedness stops us from looking far enough. Often, we miss the big picture because we were checking on the pixel strength. When we need to gaze far and understand the distant future, we need to put what we see around us aside briefly and focus on the opportunity. When the election uncertainty dominated the market mood, it was time to think beyond that. Now, it is time to think beyond the exuberance all around us. Global liquidity is not a perennial river. An investor must learn to view this as an emergency measure by desperate Nations.The hope is that if we put money in people’s hands, it will deliver growth. We can’t be more wrong. All we will get is inflation. India has learnt her lessons well and early. By putting inflation above growth, India has positioned herself for sustainable growth. So, when growth returns, we will find it consistent, lasting and reliable. Investors need to pace our equity investing in India with lasting consistency and conviction.