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2011: Arab Spring and European "Fall"!

Year 2011 is coming to an end. What started as promising year both on economic front as well as Geo-political front with Arab Spring is ending with recession clouds and European "Fall". What a mess our elected politicians have made in managing affairs of their countries. Everywhere you look, politicians are failing in delivering what they were supposed to deliver.

  • Enough said about European circus - every few weeks they meet, make lot of promises after long meetings and then go their own ways without implementing these promises. Already 4 countries have changed their Prime Minister(s) (Ireland, Spain, Italy and Greece). Next round could be France
  • US is in gridlock which is likely going to be intensified in election year 2012. So nothing would happen on economic front other than political posturing. Obama started as great promise but coming up way short than what his Presidency could have been.
  • India is stuck in non-stop corruption/Lokpal/Anna's fast. This has started to take tool on economy with Rs touching all time low of 54 against $ and growth coming down to possibly below 5%
  • Chinese are preparing for their leadership change in 2012 (it happens every decade) and trying to make sure that Arab spring does not land on their shores by increasing censorship on Internet
So anywhere you look, dark clouds are looming in 2012. So what should an average investor do? My recommendation is to stay in cash for next few weeks and invest in dividend paying blue-chips. I am short-listing few names which I will publish as we start 2012. Till then enjoy your Christmas shopping (US economy needs you to do more shopping:-) and holidays!

/Shyam

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