Financial Analysts will often go into a state of denial: If I refuse to see it, then it does not exist. This happened in the USA when the start of the sub prime crisis was promptly followed by cries of "nothing to worry". All the leading perpetrators of the crisis intially claimed that things were just fine. Later, we realized how little these people knew about their own businesses. But, ignorance came later. Denial came first.
In India, we are confronted with a simiar story of denial by the leading financial analysts who come on CNBC.
The Nifty has been in a bear market since Janaury 2008. This fact is apparent with the Index falling from 6350 to 4150 (today). Nothing to worry, say our 'fundamental' friends - economy is good, earnings are robust, the fundamentals are strong, growth propects are wonderful...... Now, this is denial. The stock market has fallen by 35% and threatens to fall more, but the analyst insists that things have never been better. Sure. The nice thing about India is that we are a free country. Freedom of speech is guaranteed by the constitution. So you can pretty much say what you want. But listeners should take all of this talk with more than the customary pinch of salt. Since most fundamental analysts are fund managers or portfolio managers of some kind or the other, there is a conflict of interest involved. Remember, these people get paid when they receive funds from the public. You do not get money when you say that we are in a bear market. Therefore, when all other explainations fail, you start saying, the long term picture is excellent. Translation: give me your money otherwise I will lose my two crore (twenty million) rupee per annum job. I call it denial.