Investment paradoxes- Is the cult of equity dying?

Worry gives a small thing a big shadow-Swedish proverb

I always recall Michel de Montaigne ‘s words that””A straight oar looks bent in the water. What matters is not that we see things but how we see them”

The world of investment presents us with many paradoxes. The stock market is and has always been characterized by unresolved issues and diametrically opposing views. The current status of the mood of the investors and the market conditions are no exception to the above point of view in the given global financial map.

Will the equity investors’ herd take this market over the cliff into a full-blown cry of quitting the market once for all?  I am doubly sure that this trillion dollar question does not have single answer.

I heard and read many times that While Main Street struggles Wall Street is back to their old tricks. No one is clear why it is so. I also wondered equally many times that such type of thinking was a bit over the top. However in the ultimate analysis the financial sector has become the epicenter of recent global crisis. It is a reflection of our excesses and this is best reflected in the markets.

It also hit a broad swath of the household savings and sentiments. Financial wizards many quiz whether the swoon is likely to accelerate the exodus of individual investors from the stock market.  A phenomenon we have been witnessing both directly and indirectly almost continuously since 2008. Perhaps may be due to disappointing returns. Numbers don’t lie in stock investments.

Unusually increasing wild day today volatility in stock prices did raise some interesting and thought provoking topics. I also wonder that whether the cult of the equity is dwindling. Today I cannot convince any friend of mine to invest in stocks. They are afraid of today’s bloated financial sector.  They are afraid to come forward the moment they know the fact that the game is stacked against them. Then where is the confidence? No chance. Long term investing is not hotter today!

In stock market investments where the accuracy ends or begins no one knows. The market speaks in a different language when it comes to award the risk reward for the investors. I am also equally aware of the fact that stock investments have never been a level playing field.  Market frenzy often feeds the scare.

The average investor finally, has gotten the wake up call that they have been ignoring. Global stock indices are tumbling day by day. No one is sure about their own financial destiny.

Bill Gross, managing director at bond giant Pimco, says in his recent monthly market analysis.-Stocks will no longer generate the kinds of returns they`ve had over the past century, ending the “cult of equity” that has been Wall Street`s mantra for generations, He also predicts the stock market`s consistent annual return will be reduced to a “historical freak” that will never be repeated.  He also adds that the cult of equity may be dying, but the cult of inflation may only have just begun.”

No one is ready to bow to the headlines blaze from magazine titles, book covers, newspapers and websites on getting rich theoretical trading strategies. The strategy of chasing performance usually ends badly. Please don’t ask me that doesn’t anybody win?

 As long as we realize and understand that ‘Money is a powerful tool but not a destination’  and also how commonsense is perhaps the most equally divided but surely the most under employed talent in the world’- Christine Collange, one may need to correct the correction in one’s mind.The hard truth is your mindset has to brave this new space in the capitalistic highway.

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