So 2576 appears too low?

Ok, this is the scenario that should play out. In 1997 the value of the Shilling was much higher than it is today. At least back then if you had Sh 10,000 you could buy alot more stocks than you can with the same amount today. i.e the value of the same has depreciated. A lot.

So the hypothesis goes that as we enter the era of deflation, the value of the shilling will rise and if you have Sh 10,000 your ability to BUY stocks (or any other good) will increase substantially. What may be seen as the fall in the price of stocks (or other items for that matter) is actually a consequence of deflation (i.e the rise in the value of the shilling).

So, in essence, the market can and will fall by more than half the present levels.

......................................

We are all victims Anselmo. Our destinies are decided by a cosmic roll of the dice, the distant whims of the stars, and the vagrant breeze that blows from the windmills of the gods
H.L. DIETRICH.

....And whether or not it is clear to you, no doubt the universe is unfolding as it should....
THE DESIDERATA

Thanks too chief.

Like the developed markets, we should have sentiment measures. These indicators are good at measuring the mood of the market i.e how much bullish or bearish the market is.

Also short selling the market is a long overdue requirement.

@Mnandii this is a theory and i am sure there are critiques to the theory.

My theory is that the so called boom & bust economic cycles are not inevitable paths but are triggered by the financial industry through monetary expansion & contraction cycles.