How will be the Market in 2021? Based on Logical Analysis.

 31^st December 2020

How will be the Market in 2021? Based on Logical Analysis.

Dear Fellow Travelers,

Namaste! We have a system of seeing the market or anything from a different perspective. Looking at the feedback to our blogs and questions I get, I know that people are interested in the Market view. They want something based on logic. One of my friends has forwarded a beautiful logical story. Just read that before I deal with the Market.

The Story: -

A young man in his mid-twenties knocks on the door of a renowned Guru. He says: “I’ve come to you because I wish to study Vedas.”

“Do you know Sanskrit?” the Guru asks.

“No,” replies the young man.

“Have you studied any Indian philosophy?”

“No. But don’t worry. I just finished my doctoral dissertation at Harvard on logic. So now, I would just like to round up my education with a little study of the Vedas.”

“I doubt,” the Guru says, “that you are ready to study Vedas. It is the deepest knowledge ever known. If you wish, however, I am willing to examine you in logic, and if you pass that test I will teach you Vedas.”

The young man agrees.

Guru holds up two fingers. “Two men come down a chimney. One comes out with a clean face; the other comes out with a dirty face. Which one washes his face?”

The young man stares at the Guru. “Is that really a test in logic?”

The Guru nods.

“The one with the dirty face washes his face“- he answers confidently.

“Wrong. The one with the clean face washes his face. Examine the logic. The one with the dirty face looks at the one with the clean face and thinks his face is clean. The one with the clean face looks at the one with the dirty face and thinks his face is dirty. So, the one with the clean face washes his face.”

“Very clever,” the young man says. “Give me another test.”

The Guru again holds up two fingers. “Two men come down a chimney. One comes out with a clean face, the other comes out with a dirty face. Which one washes his face?”

“We have already established that. The one with the clean face washes his face.”

“Wrong. Each one washes his face. Examine the logic. The one with the dirty face looks at the one with the clean face and thinks his face is clean. The one with the clean face looks at the one with the dirty face and thinks his face is dirty. So, the one with the clean face washes his face. When the one with the dirty face sees the one with the clean face wash his face, he also washes his face. So, each one washes his face.”

“I didn’t think of that,” says the young man. It’s shocking to me that I could make an error in logic. Test me again.”

The Guru holds up two fingers. “Two men come down a chimney. One comes out with a clean face; the other comes out with a dirty face. Which one washes his face?”

“Each one washes his face.”

“Wrong. Neither one washes his face. Examine the logic. The one with the dirty face looks at the one with the clean face and thinks his face is clean. The one with the clean face looks at the one with the dirty face and thinks his face is dirty. But when the one with the clean face sees the one with the dirty face doesn’t wash his face, he also doesn’t wash his face. So, neither one washes his face.”

The young man is desperate. “I am qualified to study Vedas. Please give me one more test.”

He groans, though, when the Guru lifts two fingers. “Two men come down a chimney. One comes out with a clean face; the other comes out with a dirty face. Which one washes his face?”

“Neither one washes his face.”

“Wrong. Do you now see why logic is an insufficient basis for studying Vedas? Tell me, how is it possible for two men to come down the same chimney, and for one to come out with a clean face and the other with a dirty face? Don’t you see? The whole question is nonsense, foolishness, and if you spend your whole life trying to answer foolish questions, all your answers will be foolish, too.”

That's why having wisdom is more important than having logic.

What’s my answer for 2021?

Applying logic or any particular system for market analysis is not very important. Going correct or going wrong is also not very important. The most important thing when you come to the market is your PURPOSE and your Commitment to fulfill your purpose. In my 30 years journey as an investment consultant – I have observed that the major reason for failure in the market is not Wrong Analysis. The major reason is the lack of solid purpose.

When the purpose is not solid, they get carried away by market events. The base for your success in the market is your SOLID PURPOSE and not LOGIC. Solid Purpose will give you the Wisdom to stay calm when you go wrong and take immense action when you are going right.

Before you talk about Logic in Market next time, look within for your purpose. If your inner voice is faint and if you are not sure about your purpose – you will find out reasons to blame the market / your luck / Government policies and bla, bla, bla.

If your inner voice is strong – no matter what happens in the market, no matter how many losses you have suffered in the past – you will find out ways to make the money.

So, get in touch with your purpose before you go out in the market otherwise, you will act as the above-mentioned Harvard graduate. 

Have a Great 2021.

Follow me on Twitter @hiteshmparikh / WhatsApp – +91-9869425399.

 

Live With Passion…Invest With Passion.

 

Hitesh Parikh