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Thursday, August 25, 2011

The Arab Spring

As the Arab Spring winds down into a tepid state except for Syria and Libya,it should have a calming affect on crude and on the world markets.

The rebels have pushed on to Sirte and if they can take Ras Lanuf then 75% of Libyan oil production will be in opposition hands.Still a tribal country,resistance from gadhadfa tribe to which Gadhafi belongs will ensure that complete peace remains elusive,but with Tripoli having fallen the crude prices should settle down into a range.

I strongly feel that the slowdown in the US is overdone and a huge number of columns have been devoted to this topic.Eurozone is in a difficult position to assess as news out of France and Italy is not good and the slowdown in the previous Qtr in Germany means a lot of resistance to chancellor Merkel to spare funds to bail out the rest of Europe.Why should Germany?

India too is in political flux and although i am stoutly behind the anti-corruption movement I do feel that the methods have become coercive and its taking on the shape of an agitation.We all love agitations cause they provide a welcome break,BUT yes if we are to become a clean(and green) country a la Singapore then some pain in the short term is bearable.

The Indian equity markets are nervous and with rumours galore of big European banks failing we remain on the edge.Further liquidity easing in the US will lead to higher commodity prices....a Tatasteel or a Sterlite looks an attractive buy.