Few days back I was wondering, who are the ultimate victims in this bloody bath game? A conclusion is, we as a common people, especially at the bottom and mid-level income people.
In few of my previous posts I tried to explain that the world is so much deeply inter-connected that at the certain times it is impossible to channelize domino effect. When one country or an economy or a bank goes down it do impact the entire world economy.
In 2008 we experienced that one Wall Street bank went down and Indian markets crashed. Not only India, but the global financial system was frozen. The US government took over AIG in $ 85 billion bailout package. This $ 85 billion was indirectly tax payers’ money.
In future if there would be ever need of financial bailouts countries and governments are going to do it at any cost. And victims will be bottom and mid-level income families. They would face problems in terms of unemployment, high costs [inflation], stagnant growth in salary income, individual high debt etc.
There are semi-strong signs that the financial tsunami could rise again in near future, thanks to free flow of cheap money [QE program].
Then what’s the solution?
According to RBI governor’s confidence and tactic approaches India has potential to stand back again. But, I do a favor to individuals that, we have time to hedge our savings and investment goals before any fiasco takes place.
I urge investors to take advice from professional investment advisors. According SEBI (Investment Advisors) Regulations, 2013, investment services are going to strengthen in dynamic ways for investors and financial industry.
I do understand that India faces problems in terms of corruption etc. but financial regulators like Reserve Bank of India [RBI] and Securities and Exchange Board of India [SEBI] are working to enhance better financial system.
If we will not act on our individual financial planning right now, time would not be on our side next time.