Nowadays the terms ‘IT industry’, ‘Recession’, ‘Scam’, ‘Sensex’ have become as common as talking about A for Apple, B for Boy and C for Cat..! Surprisingly those who are engaged in these are less worried than those who are far away..
A plebeian in a remote area thinks that he can analyze in a better than those who daily bang their heads to solve these financial hiccups ! If everyone possesses some solution, then why are there so many hazards ??
There are so many factors that partially or fully affect the Indian economy. Question is – are we ready to face another recession ? If yes, how far can this affect India ? and what can be the cause for this ?
The recent news says USA was degraded to AA+ from AAA ! what is this ? This is like some grading in school ! – Teacher not giving good grades.. blah blah.. but here who is teacher ? Who gave this grading ? answer is S&P !!!
What is S&P ? What is it significance to the world economy ?
S&P – Standard and Poor– US–based financial-services company that publishes research on financial matters and close analysis on stocks and bonds. The ratings are given by the S&P to show potential of a particular economy.
The leading rating agency, S&P, for the first-time downgraded its credit rating on the U.S. from ‘AAA’ to ‘AA+’ and kept a negative outlook. This could lead towards the advent of a global economic meltdown.
The debt crisis can cause minimal impact on India. The collapse of stock market on Monday was seen as a panic reaction to the downgrading of U.S. debt rating given by S&P.
Though the shares fell more than 3 percent on Monday trading, the lowest level in more than a year, the 30-scrip sensitive index (Sensex) of the BSE was ruling 17,204.11 points (EOD Tuesday), up 347 points or 2.05 percent compared to its previous close at 16,857.91 points (EOD Monday).
As per the analysis driven by Kaushik Basu, Chief Economic Adviser, in the next months and in the medium-to-long run, there will be global capital in search of safe haven and we can become the safe haven that a lot of global capital will be seeking.
The Indian corporate should be prepared strong enough to face the negative impacts of the debt-ridden U.S. and European markets. India should pitch for a significant upgrade of its credit rating by global rating agencies in an attempt to compensate the negative consequences in the market following the U.S. downgrade.
By this November, when the S&P Ratings are expected to review, India should grab the opportunity to improve its ranking of BBB- given by S&P, the lowest investment grade to the better.
After all, One man’s pleasure may be another’s pain..
