KSE rebounds, as index breaches 10,000 marks
Updated at: 1135 PST, Monday, August 11, 2008

KARACHI: Karachi Stock Exchange (KSE) opening at the new business week today showed a great deal of resilience and dynamism, which saw the index during the trading jiffy shot up by 250 points breaching 10,000 psychological barriers.

Market pundits told that the investors unlike the media disinformation dins reacted positively to the reported President Musharraf vows not yielding to any blackmail by the corrupt duo goons, which their hawkish eyes could see backfiring and getting the hovering dark clouds of political instability in the country finally cleared soon. No wonder, the trading opened lively and the investors went on making purchases of attractive shares finding their prices quite profitable.

On the other hand, KSE-30 index also soared by 369 points and was seen pegged at 11,531 points. Over 44.8 million shares traded until the filing of this report.

Source: The News

No doubt that not only investors but every person who depend on jobs or hard work would be sad to see even chance of President Musharraf going. When people invest then only industries are set-up and people get jobs. When people get jobs they buy goods that make the businesses more profitable and thus wages increase. When wages increase, people demand more goods and that mean increase in production and profits, resulting in more investment. That creates more jobs and higher wages. People become richer and country develops.

It is investments that are behind businesses. Stock market is where investments come, that eventually get passed on to businesses. Actually when people buy shares, they buy participation in businesses of the company they bought shares, and it is their investment that make companies expand. When people run out of country with their investment, it means no new investments and old investments disappearing, resulting in businesses closing down. That result in people losing their jobs and it means less to spend, creating more businesses to close down, wages to start decreasing and misery of people increasing. Economy starts going down, interest rate starts going up, currency starts devaluing, resulting in more and more closing of businesses and misery for the country and people, especially poor in the country.

Here is story of two investors who invested in Pakistan between 1995 and 2008:

I know ‘A’ who lives outside Pakistan. He decided to invest in Pakistan. He invested around $70000 (~ Rs 22 lac .... $ @ Rs 32) in March 1995 and did not took a single penny out since then (even dividends were reinvested). Same investment was worth around $22,000 (~ Rs 12 Lac ... $ @ Rs 54) in 1999 ... when Musharaf came to power. Things were so bad that most people were expecting rupee devaluing to Rs 100 per dollars before 2005. Country was on verge of bankruptcy and was independent only by name.

Anyhow, in early 2008, same investment was worth over $390,000 (~ Rs 240 Lac ... $ @ Rs 62) ... around 17 times in dollars (20 times in rupee) what it was worth in 1999.

When crooks and thugs got elected, ‘A’ felt things would start deteriorating. ‘A’ thought to go to Pakistan and cash all his investment and pull that out of Pakistan (Feb 2008). Unfortunately, ‘A’ showed laziness, hoped that things would not deteriorate that fast as it happened, and now ‘A’ is sitting on huge losses.

Today, investment of ‘A’ is worth around $215,000 (~Rs 160 lac ... $ @ Rs 74). For ‘A’, his paper loss within last few months is worth around $175,000.

Anyhow: ‘B’ was not that lazy. In late 2000, trusting Musharraf honesty and commitment for Pakistan, he invested $50000 (~ Rs 30 Lac ... @ Rs 60 to dollar) buying various Pakistani shares. When crooks and thugs came to power, he also felt same as A. Anyhow, instead of getting lazy like ‘A’, he went to Pakistan in March 2008, cashed all his investment that grown to over $1,100,000 (~ Rs 700 lac ... $ @ 63) ... more than one million dollars in less than 8 years, and moved them outside Pakistan. Even though ‘B’ moved at right time, he curse present crooks and thugs, as he believes that cause of all ills in Pakistan and poverty in Pakistan are due to such crooks and thugs who are making fool of people in the name of democracy.

As for ‘A’, he is cursing crooks and thugs in present government every day. He says that his investment lost value from 1995 to 1999 due to same crooks and thugs who came back again in early 2008, as curse for Pakistan and for him. He is happy that present government is going for impeachment, as he believes that impeachment would fail. He believes that Army and patriotic Pakistanis who are not retarded and can think are with President. He thinks that regardless of impeachment result, martial law is eminent, as that is needed to save Pakistan from going back to bankrupt condition that can cause country loosing independence. He is praying and hoping that coming martial law would be bloody, where most crook and thug politicians along with their chailay and chamchay would get executed, and there would be no exile, long prison, or running away from Pakistan.

[Note: 'B' did not do as good as some others. Only difference is that those I know, most invested at lower scale and did not cashed in when their investment was at its peak. Investment of some increased from $2000 dollar (around 1 lac) in 2000 to around $70,000 (~45 lac) at peak (early 2008), that has now decreased to around $35,000 (~25 lac)].