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How fast will the Sensex touch its previous high? Will this rally last?

When i was away to disneyland, the markets across asia shot up. In an interesting interview to Mint, Ruchir Sharma, the head of emerging markets at Morgan Stanley Investment Management, has said that what’s happening right now in the markets is nothing but a cyclical bull market within what is still a structurally a bear market. As far as India is concerned, he opines that Indian markets can exit this bear market regime a lot quicker than the developed world. "I think valuations have already moved now from being cheap in March or late October, to being sort of relatively fair to slightly expensive... If you are looking for a true new bull market... I think the base for that will be set by the middle of the next year," he said. And that’s when he feels that the bull market rules will come back into play, and the Sensex will once again be free to touch its highs of 21,000. HOWEVER noted investment gurus Jim Rogers and Marc Faber are of an opposite view when it comes to world markets. And their opinion is that the current rally is a result of liquidity that has been created by the printing of money at the drop of a hat rather than any concrete measures to beat the crisis. In fact, the fundamental problems remain largely unsolved.
Therefore, besides believing that equity markets are set to witness a major correction, they expect the next crisis to emerge in currencies given that many countries have shifted more of sour debt from banks onto their own balance sheets. Coming from both these renowned gurus, it is indeed pertinent to take note of their opinions since they are strikingly similar.
Even i am of the opinion that the large scale printing of money to bailout banks will come back to haunt governments in the form of higher inflation.

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