Sunday Reflections

[krish44]

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Another sunday .

Very gloomy day with cloudy sky and light rains .

India-Pak NSA meet cancelled.It is too disgusting to talk about india-pak relations. ....

Onion prices hitting the roof crossing 100rs a kilo.In last fifty years , we are unable to fix the issue of onion availability and distribution.

Wholesale traders/Hoarders are able to store them to release them at their will at whatever prices they want.Govt can neither crackdown on them or ensure

distribution at reasonable sale price. The wholesale price went up only 400 rs a quintal but the retail has shot up from 40-50 to 100 and above.On imports

advance action is not taken . Those stocks which have just arrived at port will take at least one week to clear and reach the market. similarly prices of pulses,

cooking oils are on the way up.just a 10 percent reduction of overall rainfall in this season in marathwada, parts of karnataka,telengana is the trigger for all

misery.

Even online offers and monsoon sales for retail items-electronics,mobiles,clothes are not enticing. Too many sites offering discounts with hardly any buyers. Malls are desolated.only a few window

shoppers.

I thought movies could be a way out. I saw one tamil movie -saravananum vaasuvum onna paduchavanga {svop]-I hope I have got the title right.

A sick comedy which preaches if men have to have to keep their friendship going after their marriage, they should learn to lie to their wives to enable that.

Most wives have a way of breaking up close friendships of their husbands , since they think husbands friends are undesirable elements out to damage their

married life by their intrusions and unwanted advice.Arya and santhanam who play buddies have good chemistry and tamanna is her usual pretty self.

If one has nothing better to do one could sit through it and console oneself it could have been worse than it was.

It would be a better idea to see short films on PC. There are some Anurag kashyap beauties on you tube. stars like Radhika apte, nawazuddin siddiqui,

soumitra chatterjee appeared in some.Radhika apte is making waves. She is likely to be a top star in course of time. She has starred in Manjhi - the mountain

man , a very talked about film.

If things go on like this I was reflecting , I have to get more of my relatives children in extended family married off and spend time find matches for them. It is an

interesting occupation. My fear is I will find a match if I try. I find at least two grooms/brides per year on an average for my extended family members

another pastime is indian stock market. The way it is plunging down I do not know if it has bottomed out to do fishing. Rupee has already gone down to rs 66 a

dollar. Where does one park money when it is fast becoming worthless.?

Even housing industry is in doldrums ,so not worth buying anything.so wait and watch. Yesterday Sbi CMD Arundhati Bhattacharyya idea of teaser loan at 8

percent for housing was shot down by Raghuram rajan . He wants builders to reduce prices to improve offtake . will it happen?

 

[vgane]

Dear Krishji,

I will start with your last point on housing prices...It has already bottomed out...If price double in 7 years it is not a great return...So I guess there is not much scope for correction..

But those who bought 10-12 years back especially in Gurgaon in Golf course road or in DLF are sitting in a mountain of cash..The appreciation is over 10 to 12 times

The best way to get to stimulate housing growth is to reduce the rate of interest

But why does our RBI Governor think that by decreasing the interest rates will have a boomerang effect on inflation

If we are going to constantly fear about inflation then we will have to contend with 5% growth

 

[krish44]

Mondays concern is the stock market. Indian sensex has crashed more than 1000 points mostly on global factors.

Rupee at all time lows.

China dropping further, US market sell offs, greek woes with PM resigning , oil at all time lows, rs 2000 cr sell off by foreign investors from aug beginnings.

I do not know if the pain is over yet.

even with low oil prices, there are still current account deficits.

India has FE reserves . all soft talk by Raghuramrajan is not aiding sentiment of investors.

there are no safe hiding places for money. gold could help . defensive like HUL could reduce the pain.

financials are the worst hit.

Indian retail investors would be remembering 2008 again.

Most think US market is stable . It is a myth.

Today the stock market in US matches its value with 1999 which essentially means that they are back at 2009 levels.

India is paying a heavy price for opening out to global market.

 

[mkrishna100]

Where does one park money when it is fast becoming worthless.?

Park it in such a way that it helps you beat the inflation and is also avilable for you when you need in an emergency . There is no one sureshot method for the same but a combination of investing in stocks , bonds , FDs , RDs is one way .

 

[vgane]

Park it in such a way that it helps you beat the inflation and is also avilable for you when you need in an emergency . There is no one sureshot method for the same but a combination of investing in stocks , bonds , FDs , RDs is one way .

But are you getting a return higher than rate of inflation?

 

[yesmohan]

Gross rate of return on savings will be 9% to 9.5%

 

[mkrishna100]

But are you getting a return higher than rate of inflation?

If you are a smart investor cum trader in the stock market you can get better results that beat the inflation but then there is a high risk of your capital also getting wiped out and hence a balanced approach is needed .

 

[yesmohan]

If you are a smart investor cum trader in the stock market you can get better results that beat the inflation but then there is a high risk of your capital also getting wiped out and hence a balanced approach is needed .

Risk taking and challenging... not suited for senior citizens.

 

[krish44]

Risk taking and challenging... not suited for senior citizens.

Risk taking is a mindset. It has nothing to do with age.

with age, when senior citizens have fulfilled lifes responsibilities and shorter time to live, there is no reason for not taking more risks.

After Setting apart a small sum for future including contingencies, the balance is for only risk taking.

We came with nothing into this world. Why leave it with assets for someone to quarrel over?.

This is the best time to plunge and take risks .

even in 2008 those who kept their heads and invested wisely benefitted.

 

[krish44]

Dear Krishji,

I will start with your last point on housing prices...It has already bottomed out...If price double in 7 years it is not a great return...So I guess there is not much scope for correction..

But those who bought 10-12 years back especially in Gurgaon in Golf course road or in DLF are sitting in a mountain of cash..The appreciation is over 10 to 12 times

The best way to get to stimulate housing growth is to reduce the rate of interest

But why does our RBI Governor think that by decreasing the interest rates will have a boomerang effect on inflation

If we are going to constantly fear about inflation then we will have to contend with 5% growth

I beg to disagree.

Real estate big builders are sitting on a pile of unsold inventories. They have deep pockets. They have also parked their blackmoney in these apartment blocks.

Not many new projects are getting announced.

Unless builders are brought to their knees , Banks should not relax on home lending rates.

Housing sector requires regulation so that middle class can get access to home of their own.

Unless property rates correct ,it is not possible.

It is wise for middle class to save money and collect bank interest until the market corrects. It is not worth borrowing to pay unscrupulous builders