So far..
Indices has moved back to Jan11 levels or closer to Jan08 levels. However, indices today are very different from previous times. The exchanges revamp the indices, by adding flavour-of-the-season and expelling the rotten tomatoes very regularly ((link link)) - (This makes indices a good hold for ultra-passive investments.)
The rise in the markets have got less to do with drastic improvement in the biz environs. On one hand, consumables/FMCG/b2c businesses have done very well in last 2 years of slowdown. Not only their earnings have risen, their multiples are rising faster and consistently crossing their own all-time-high valuations. However I am not comfortable with such high multiple businesses, as I think even a minor negative surprise can prick the balloon. However, I may commit mistakes of omission here.
Other side of the market - the manufacturing, auto, capital goods, metals, infra, etc, are severely affected this year. Industry capex is very poor. Power shortages and cuts are affecting industry in many states. This is also leading to industry-migrations. This end of the market is very attractively priced.
Few positive changes have already happened in the power market. RBI and Central Government has pushed states to revise tariffs, and improve the distribution efficiency. Coal situation is poor. Wind industry is down 40% this year, due to removal of accerlatated-depreciation incentive. This year too we are looking for steep hike in power prices. Its move in the right direction, however its too early to say anything.
Activities
As our positions are concentrated, we had minimal activity. We are adding up to our holdings.
New discoveries, readings, et al
My discovery of the year was on the topic of confabulations - the story making and value-adding ability of the mind to the reality. Neuroscientists call this the virtual-scene-simulation. Its a important topic as it bridges the connect between neuroscience-mind-spirituality-happiness. Do read. (Check these amazing cartoons)
And readings..
Linkedin removed the amazon-book-app from its website. In absence of it, I am compiling some good reads here..
-Strangers to Ourselves
-Proust was a neuroscientist.
-The Three laws of performance - Zaffron & Logan
-Power of Now - Eckhart Tolle
-The top five regrets of the dying
-Worldwide laws of life - John Templeton
-The Humble approach - John Templeton
-Education and the Significance of life - Jiddu Krishnamurti
