MONEY MATTERS

When the recession ends and the markets move up considerably again, and when others are greedy, you should think about selling part of your swollen stocks (bought during recession). Invest your tax-free profits in bonds, Post Office deposits or bank FDs. This way your assets will be rebalanced and your capital much better protected against another recession and yet another future stock market crash. 

The end of recession will not be announced in the newspapers. It is something to be watched out for. You could have seen it coming, the last time in May 2003, when it was reported in Business Standard that the “overall net profits of the Indian companies may now touch a five year high,” and “as many as 59 loss making companies saw a turnaround and showed profits during the 2002-2003 fiscal year.”

A big reason for the end of recession was a drop in interest costs for businesses. Also there was an average raise in the annual salary of employees. Similar reports will appear again. A rising Sensex, going up of bank shares, discounts fast disappearing from shops and from equity shares, are other indicators of the end of recession.

Until then, it is the time to save and invest wisely, and enjoy the discounts while they last, so that you may reap rewards when the good time returns.

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