Skip to main content

November to Remember: Diwali, Elections and Markets!

It's that time of year when "scary" October gets over with Halloween and November starts with holiday spirit. This time Diwali also happens to be in November (happens once in approx 3 years). So first of all, Happy Diwali to all my readers! This is the biggest and most joyous festival for "festival crazy" Indians. The festival itself goes on for 5 days but if you combine with Vijadashmi, Navratri and multiple weekends of Dandiya, it feels like we are in this for months. It's also called Festival of Lights! With lights, fireworks (where permitted), sweets, parties with family and friends wearing colorful outfits, it's fun! This time I am also looking forward to seeing Aamir/Amithabh's most awaited film "Thugs of Hindostan" which is releasing day after Diwali. it's MUST WATCH film. Go and see in theaters.
November also brings election season every two years These are mid-term elections but due to unique style and substance of our President Trump, it feels like Presidential election where people are going to vote for President Trump or against him. These mid-terms would be one of the most consequential elections in deciding future direction of country. As I have written in past couple of blogs, I am predicting split congress with house going to Democrats and senate staying with Republicans (I have few lunch bets with friends). It would produce gridlock in Washington which is exactly what we need to stop some of the policies and bring back "Art of Politics (aka compromise)" for good of country.
While markets would love to have status-quo (means Republicans winning both house and senate), it will get used to split government and indeed rally after elections as it has happened majority of times. There is also some sector rotation happening in which money made in tech stocks (FANG) is going into less exciting sectors like utilities. With full employment and relatively stable inflation, Fed would continue to raise rates at least two more times before taking a pause.
What a mess company can get into due to lack of vision and leadership. Who would have thought that in all companies GE who is famously known for producing CEOs for other companies would be in such a mess and would need outsider CEO. General Electric (GE) stock is at 9 year low and reached single digit ($9). It reached low of $6.66 in March 2009. So would it go to that level or has it reached bottom? GE has become a binary investment decision (similar to Valeant - now Bausch Health 2 years back). Would it survive or go bankrupt? Given GE's storied history - it was the only stock to remain in DOW for last 125 years before it got kicked out this year - the company would survive after CEO Larry Culp does cleanup. Return on investment in GE stock should beat returns from S&P over next 2 years. But it would need courage to go thru volatility and uncertainty.
After Diwali, Thanksgiving is not too far! So enjoy your sweets and get ready for Thanksgiving!
/Shyam

Comments

Popular posts from this blog

2024: The year of.....

Wishing you a joyful New Year filled with laughter, love, and unforgettable moments, surrounded by cherished family and friends. May the 2024 bring similar gains as in 2023! I had great 2 weeks break with travels to Turkey with family and then solo trip to Palm Springs. Both places are amazing and definitely worth a visit if you get chance. Talking about gains in 2023 - Here is recap of 2023.. Inflation fallen below 4% and heading towards 3% Unemployment firmly below 4% Real wages growing above 4% GDP growth around 3% Markets: S&P notching one of the best year with 24% gains while Nasdaq doing even better with 40% gains thanks to Magnificent-7 (or TAMMANNA) many of which had triple digit gains My personal recommendations did exceptionally well - many of which were up by high double digits (e.g. INTC) and some of them had triple digit gains (e.g. META) All in all - 2023 was great year.  As calendar changed to 2024, what's in store for new year? This is election year in many coun

Roaring 20s....Again!

About 2 years back coming out of COVID pandemic, I wrote blog titled " New Roarin' 20s.."  It covered what happened in 1920s and what are the factors now which would trigger new roaring 20s. Do check out the blog...almost all factors are valid even now. 2022 went sideways due to inflation pressures which triggered historical steep rate hikes by central banks which led to tech companies taking more measured approach and laying off 200,000 employees....all of that changed in Nov'22 when ChatGPT was launched...even though I had mentioned AI/ML as one of the factor in my previous blog, ChatGPT really captured the imagination of the world and changed the outlook of AI instantly similar to what Netscape did with the Internet and iPhone did with the mobile. The singular concept of "Language is the Interface" made AI accessible instantly to billions of normal people....And now without mentioning AI, no talk starts or ends in tech world..and despite onsite of most-aw

It was not meant to be...

I imagined today' day (Nov 19, 2023) little differently than what it turned out to be..had a watch gathering at my place with few friends for India vs Aus ICC Cricket World Cup Final. Both teams deserved to be in the final - India winning all games in this tournament and Aus winning last 8 games after initially losing 2 games at start of tournament. The match was being played at the biggest stadium in the world (over 132,000 capacity) and over billion people tuning in...maybe most watched single sports event ever. After Australia won the toss, they choose to field (that's what most likely India wanted). India started well but then wickets kept dropping and India ended with total of 240 all out. That's when all of us knew that the dream of winning third world cup is over...despite one of the best bowling squad India ever had....The score was just not enough even for the best bowling to defend against one of the most professional and mentally strong team....No wonder Australi