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Amazon "Jungle" Keeps Expanding!

Normally I don't blog about my work and company I work at (Cisco). However this time I will make small exception. This week Cisco launched one of the biggest launches in company's history with Catalyst 9000, DNA/SDA and ETA. I am proud to mention that my team (along with some other teams) have been working on these intuitive products and solutions for last two years (Network.Intuitive). Congrats to all my team members!
Environmentalists would be very happy if real Amazon jungle stops shrinking (due to human activity) and expands in the way Amazon company is expanding its reaches. Amazon is one company which has proven everyone wrong. I am sure there is not a single person in the world (other than Jeff Bezos) who had belief in this company when it went IPO in 1997 and it's journey as public company over 20 years. If there is such person who had invested $10000 would be worth close to $5 Million today (assuming he/she has lived thru all ups and downs). No wonder Jeff Bezos would be richest person and first one to be worth more than $100 Billion before end of 2017. Hats off to Jeff! He is "Warren Buffet" of our generation! Amazon's decision of buying Whole Foods was based on principle of "Everyone has to eat" and Amazon can make it as simple as what it had done for millions of items to "grocery". The kind of impact this move would have is enormous even at macro-economic level in areas like
  • Lower inflation
  • Lower energy needs (less car-trips to malls and now grocery shops)
  • Productivity gains (due to savings in time)
  • Higher-paying jobs (from cash-register jobs to data analysis jobs)
Economists and even Fed governors would need to start incorporating "Amazon" effects in their models while projecting these macro-economic indicators. 
So where does Amazon goes from here - let's make some bold predictions for 2027
  • Amazon sales would be over $250 Billion per year
  • Amazon profits would be over $10-15 Billion per year
  • Valuation  would be $ 900 Billion to 1 Trillion
  • Could be most valuable company at that time
Switching gears to my thoughts on markets:
Generally markets have been slowly inching upwards with lowest volatility (as evidenced by VIX below 10). This is happening despite policy uncertainty in US. Would this be "calm before storm" similar to what happened in 1987, 1997 and 2007. There seems to be pattern with these years and we are in 2017. So watch out for direction post Q2 results and beware of Sept/Oct. It would be prudent to take some profits off from your gains and wait till late Oct to invest.
If you have to invest during summer, it may be good time to rotate from "best performing" sectors like "tech/bio-tech" to "worst-perfuming sectors" like energy. This is contrarian advice but goes with Buffet's principle.
Have a great weekend!
/Shyam

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