Rising tide and sea of change
Why we buy into stocks and companies ultimately has to do with fundementals - look a little deeper at Egypt and compare to other African countries or Mongolia and the simple answer it is not the same. Mongolia could fall off the face of this earth and it would not make any difference to global interests (i.e US/Europe).
Egypt on the other hand is different, vastly different. There is risk in everything but I would put my money in Egypt before I would even consider Mongolia. Co-dependent relationships is what we are talking about. Each needs the other. Political risk, though understandable, is not the real issue - though the 'market' would like to say otherwise. The way I look at this, is regardless which political party is in place, they would have all the same economic issues to contend with but at the end of the day - Egypt, needs the west, as much as the west needs Egypt. Think of it like this. If you were a bank (IMF/European Banks) and an important customer came to you (Egypt), who badly needed a loan because of market conditions.
The bank has been lending money to this customer for years and customer has been a good customer. Now if the customer said they want to sell all their assets (i.e. nationalize) and get a loan the bank would say sorry no can do. So as a customer, you know this, what are your choices? This is the point, nationalizing is not in the best interest of Egypt.
Egypt on the other hand is different, vastly different. There is risk in everything but I would put my money in Egypt before I would even consider Mongolia. Co-dependent relationships is what we are talking about. Each needs the other. Political risk, though understandable, is not the real issue - though the 'market' would like to say otherwise. The way I look at this, is regardless which political party is in place, they would have all the same economic issues to contend with but at the end of the day - Egypt, needs the west, as much as the west needs Egypt. Think of it like this. If you were a bank (IMF/European Banks) and an important customer came to you (Egypt), who badly needed a loan because of market conditions.
The bank has been lending money to this customer for years and customer has been a good customer. Now if the customer said they want to sell all their assets (i.e. nationalize) and get a loan the bank would say sorry no can do. So as a customer, you know this, what are your choices? This is the point, nationalizing is not in the best interest of Egypt.
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