Wednesday, February 2, 2011

Egypt situation

The market seems happy with the situation in Egypt. It assumes the end of Mubarak is near and it will be peaceful. The disruption will be insignificant. I do not agree with this assessment.
First, there will clashes between protesters and pro-government forces. There are many interested groups benefited from the current government and they will no go quietly.
Second, even a power change at the top is not going to cure the inflation, poverty and corruptions. Just look at Pakistan, the change of government did not do much good for its people.
Third, the oppositions are not well organized and the fighting for power will be ugly as soon as they lose their common enemy.

I will be very cautious right now. The market is due for a correction.

No comments:

Post a Comment