market crash, crude oil, and greece

The global markets took some toll, and have been giving some signals. That is, crude oil is going to fall further, Greece is going to exit the Eurozone, and the markets will get into some sort of recession in the coming months.

Anticipated supply in excess of demand is taking oil price lower by the day. OPEC has been pushing for supply, Europe, China and the rest are keeping demand lower; and presto, you have low prices. The price war is imminent; but who is going to win it is unclear. OPEC nations, dominant ones in particular, have lower cost of production compared to the US shale phenomenon. Those who have the capacity to endure lower prices for long are the ones who are likely to last longer. However, whether all this was really required is a matter to ponder over. A few energy companies might tumble in the process. But hey, isn't all is fair in..., or is it? Here's a prediction, though: in the long run oil prices would set themselves right. 

Europe may not be ready for another Greek crisis is alright, was it really ready for a common currency without control and accountability is another matter. Some deep thinking would have discouraged the Euro in the first place. Here's a prediction again: Greece might or might not exit the Euro, it might or not affect others in the Eurozone, Italy or France, or any other, nevertheless, in the long run the Europeans would earn more, spend more and save more.

As investors, all we want to know is which businesses are good enough to endure short term onslaughts, and yet be around to do business in the long term. If longer term cash flows and growth potential are not affected too badly, there is a case for buying into those stocks. Increasing interest rates may not threaten the US stocks as perceived to be, while falling rates can provide solace to the Indian stocks. 

Go look for the businesses that have been around for a long time, have capacity to wait and call shots, sell products that consumers cannot say no to, and have little or no debt. Wait for the markets to crash, pick those favorite stocks, and wait again for the markets to recover. In the meantime, do what you enjoy doing, whatever that is. Don't fret over stuff that does not matter in the long run.

Again, it comes to behaving right.