Wednesday, October 1, 2008

How Times Change!

“Banks never loose.” is a sentence you come across a lot of times when you read novels with business and banking backgrounds. And in a way I believed that. Considering the business models of the banks and all the laws and regulations to govern and protect them, it is easy to believe that banks never loose.

But last year changed this. We saw American financial institutions posting billions of dollars of losses. It is interesting to see almost all of an industry going wrong about the same thing. And that too something like finance sector, where most of the institutions are run by well qualified intellectual people.

This has changed a lot in India too. I remember not even a year ago, when Sensex was soaring around 20,000 mark everybody was investing in share market. People were talking non stop about who made how much. People predicted that Sensex will go to 40,000 in a few years. About how India was becoming hot investment destination and all.

Then bad things started to happen. Sensex plummeted. People started talking about slowdown in US economy. Software engineers discussed how companies had started to cut back on perks such as air travel. Then came the news of job cuts by various companies. Quite a few people decided to wait and not take home loans for lack of job security and rising interest rates.

I know probably you know about all these things and may be wondering why I am writing these down. The reason for this is the first time in my 26 years of life I am witnessing how things, people and world change with economic cycles. Sure a lot of similar things must have happened before this but at that time I was either too young to understand the significance or too occupied in my little own world.

It is fascinating to watch how public sentiment changes over the course of time. Today when I look at this scenario and think about my prospects as a future businessman, all these things evoke a whole gamut of emotions in my mind, sure there is fear and paranoia but also there is also a sense of opportunity, hope and surely the excitement of witnessing something profound (may be unfortunate but profound nonetheless) happening which will surely mark an important period in modern economic history.

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