With all the nonsense in the press since May 2, you would think the world was about to come to an end. But no. As usual, the NY Times and WaPo have about as much credibility on the subject of Pakistan as do the predictions of that nutcase Denver based right-wing priest, Harold Camping, and his Christian Family Radio on the subject of the Earth’s longevity. And if a loud echoing, face-reddening slap could be delivered to such naysayers for the animal excrement one now finds plastered on the front pages of the Post and the Times, it was this: The Karachi Stock Exchange, Pakistan’s largest bourse, has closed on a 3 1/2 month high at 12,198.12 points. Forget the PM’s speech in Parliament and forget whatever Gen. Kiyani has to say. Let’s focus on reality and the facts on the ground. Let’s focus on what thousands of investors and business people who are connected to the core of this country and are clued in to tens of thousands of active projects actually think about the future.
The KSE has done exceedingly well in the past couple of years and we’ve covered its performance here at TechLahore quite often. But beyond the economics, it’s important to keep in mind what the KSE represents. Usually, whenever we cover the KSE’s movements we get the odd, “Oh, but what does this really mean?” kind of comment. So for the sake of clarity, here’s what it means: The investors and participants in the KSE are confident about their future, which means they are confident about the future of Pakistan. No one throws money into a stock exchange because they think their investment will tank. So other than the financial implications, the main point of interest for us is how optimistic Pakistani businessmen and investors are in their future. And why shouldn’t they be? Pakistan is the world’s seventh most populous state, with the world’s fifth largest army and as Christina Fair put it, a country that “simply has many asymmetric options” which means that no one in their right mind is about to cross any red-lines with us. Moreover, Pakistan’s exports continue to do well in the EU with the recent positive movement on tariffs, remittances are growing fast, are at an all-time historic high and there seems to be national consensus on the issue that the “AID” bluff is exactly that, a bluff. The aid – mostly REIMBURSEMENTS – that “prop” up the economy in the vivid imagination of certain ill-informed senators in a foreign country and myopic media people, are actually neither necessary nor desirable. This aid bullcrap is simply used, at this point, as a political lever with no measurable impact on the economy or development of the country. And on this subject, I think the universal message from Pakistan is, “Stuff it!”. Indeed, the government of Pakistan’s most populous state, the Punjab, has voluntarily cancelled aid agreements with the USAID. How’s that for leverage? The KSE seems to be echoing this very signal because precisely during the period when noises were being made close to the banks of the Potomac about using aid as a threat, the KSE was heading into the stratosphere as if to laugh in the face of this nonsense which is everything but connected to reality.
We’ll try to do a longer piece on where we see things headed in the near future, but until then, let’s keep our eye on the jewel of Karachi. KSE FTW!