Rupee nosedived / Desperate RBI continue supporting Real Estate Brokers

Rupee crashed to all time low of 60.72 at the end of the day today.  Patriotic Indians should celebrate the moment as both Government and RBI are busy screwing up the economy day by day. Instead of saving the Rupee the RBI is increasing the provision limit for housing loans and also allowing real estate brokers to mobilize money from foreign countries.

I see the act of RBI from 2 perspectives.

1. RBI is desperate and being pushed by FM, so giving generous freebies to RE brokers.

2. To get in the foreign exchange, RBI is opening the RE sector, so that brokers can mobilize funds from foreign countries as other businesses in India lost the ability to do business within reasonable margins. Real estate brokers being brokers in India, think that they can continue doing business at current 60-80% margin even by mobilizing money from foreign countries. In a way I am happy as this may be the final nail in the coffin.

Meanwhile markets continue to crash. Nifty crashing below 5600. Let us wait and see the nifty below 5000 within couple of months.

A dark comedy called WPI ( The inflation barometer of India)

They say RBI is measuring Inflation based on WPI and WPI is now less than 5% ( 4%??). But mangomen of the country when they go to market to buy vegetables they find potato at 50 and tomato at 60 and onion at around 100 Rs. Interestinly the mangomen of this banana republic stopped complaining. Another country which is comparable with this banana republic which went inthe same path is in shambles now ( Read Brazil).

I really doubt the logic of RBI following WPI. If they still say we follow WPI then better the can say that we won't see inflation at all for rate decisions. They can just go on and print money and give it to bankers and corporates.

The rise of Yes Bank is due to RBI money printing in my opinion. They opened newly in metros and in short time they are now one of the leading banks in private banking space. Simply they get free money from the Indian banking system because of money printing ways of RBI and multiplied the money and now fighting within themselves for the same money :)

Great India.

What is called reform?

Now since the market starting to fall people are panicking. Who all are panicking?

1. Corrupt politicians
2. Cheat corporate
3. Mafia Real Estate
4. Broker Media
5. Finally the common man who is conned/induced into investment in Real Estate by the above 4

In addition to this list, the so called financial analysts also panicking and started talking that new reforms will help stopping the fall. But in my mango opinion nothing can stop the upcoming catastrophe. Indian Government and its puppet RBI has exhausted all their options and are watching the crash of Rupee helplessly last week.

If a finance minister come on Tv to assuage investor once in a year it is normal and thereby he can command come respect in the market place. But our finance minister come on TV every week whenever there is a fall of 20 points in the index. This is comical. Markets stopped responding to his gimmicks. Last week Raghuram Rajan was given the tough task of convincing markets. Poor Man. What can he do?

Now coming back to reform stuff, I do not see any need for reform. What is needed in couple of percentage points of rise in Interest rates. A small hole in Real Estate Bubble. Some tightening of income tax rules and compliance. This is enough

Some time the so-called experts will over think and over do things and make seemingly simple things complex. That is what happening now.

Rupee / FII / Bond

Simply put now RBI is in dilemma and effectively check mated. If you had observed carefully the rate cut lobby is shutting all its holes in the body last week after the spectacular fall of Rupee. Now Subbarao will give a punch in the face for whoever asks for a rate. RBI is almost knocked out by the vicious cycle of bond returns and Repo rate.

If they reduce repo rate, FII who are already making loss will make further loss, and hence will go out of India.

If they increase repo rate, it appears atleast 75% of top corporate honcho will go on indefinite strike. ( have you ever seen Tata begs for rate cut? I did not. That is the difference between real business man and reel business man

RBI did not cut rates because they cannot cut now.

Nifty Index View

After Bernanke speech many would have observed huge FII selling in bonds and stocks. Stock selling started late but catching up fast now. Friday I saw huge sell figure from FII desk. Let us hope this continues. I am looking for some cheap puts and I think we can easily see 4500 - 4800 in nifty very soon. I mean as early as this year end.

Real Estate Effect

RBI may raise rate or not. Liquidity will dry and Real Estate sharks will run for cover. The tide is going to retreat and we will all see who is swimming naked. That will be interesting. Already I see many ' to let ' boards in many business establishments in Bangalore. Let us wait for the cleansing act and hope for a good beginning after the upcoming crash

Indian Inc disappointed :)

By making their displeasure known to everybody, the masks of so called corporates are off. Their real face is coming out. They simply don't care about inflation or aam aadmi. They are bothered about their ill gotten wealth.

RBI is also not a holy cow here. The issue here is that if you reduce rates then due to reduced bond yields foreign investors will sell their bond investments. So that this tamasha.

check mate.

Game is getting interesting now.

Dear Mr.Subbarao

I know this week is very taxing for you.I know you are coaxed, cajoled, blackmailed,praised, pressurized for a rate cut this week. Come Monday afternoon you will be relieved for another month or so.

Whatever happens you will be remembered as a weak RBI governor who could not control inflation and who could not revive growth and who could not stop Rupee from falling.

You are good but easily bulldozzed by blood sucking corporates, corrupt government and pimp media.

I feel sorry for you.

Any shame left Mr.Finance Minister?

Please go through the below article. This talks about ( actually justifying govt move) the pricing of the FPO of government issues. We need not go into the nuances of the issue. What I am trying to talk here is about the government idiotic disinvestment policy.

http://www.business-standard.com/article/markets/analysis-is-the-government-selling-mmtc-for-free-113061300173_1.html

It is a pattern that whenever government announces an FPO, the stock is hammered in the markets. This shows government and company is in poor light. One tends to think that the market participants ( Foreign investors or brokers??) trying to take the price down before the FPO and get the stocks at throwaway price.  Should government budge to this tactics? This goes on to show that either the shares are already trading at huge premium or government is losing huge sums of money. Why we need to sell these shares at throwaway prices?

The latest share which is being affected by all these is IOC. It is one of the blue chip company and if I remember correct we were discussing about 400 Rs or more for IOC disinvestment. Even government postponed disinvestment because it felt the then price of 350 is less for IOC. But look at now. IOC is struggling at 250 and government shamelessly moving the file for disinvestment. I guess we can get IOC at 200 Rs through FPO process. As a retail investor we will get 20 shares and crores worth share will be bought by FII at throwaway price.

Now, I am seriously thinking Supreme Court should interfere and stop this nonsence. Any takers?

I expect comments pls guys.

Real Economy of Real Estate Economy is in Real trouble

Due to past 2 days Rupee movements 'ready to sell wife for rate cut' lobby is upset it seems. Donot worry. still you can extract rate cut from this banana republic.

Continue trying.

Easing farce

Do we still have some rules which needs easing? You must be joking. Mangoman's reaction for govt plans to attract soverign funds

Market is not panicking...Financial ministry is......

Rupee has nosedived into 58.15 levels during close today.

I was so so happy to see the Rupee tumbling. In a way I feel sad for wanting our Rupee to crash. But on the other hand, given the idiotic way this country is being run, I would really like to have some sort of catastrophe so that people understand the ground reality the mend their ways.

Inspite of all this one broker media has come up with a paid article and still the stupids want rate cut from RBI.  Poor RBI. They are caught between the devil and the deep sea.Now RBI with its dwindling dollar reserves bite the bullet? I presume not. But strange are the ways Indian system works. RBI may be forced into act against its wish.

Actually devil inside me tells that RBI should cut the rates so that the inflation flares up again and I wish the crisis should accelerate further so that downgrade comes from ratings agency.

Let us see what happens next..

I think in the immediate future ( 1 -3 days) RBI will come up some desperate measures to stem the fall. But having exhausted all its options it would be interesting to see what RBI will do.

Funnily finance secretary said that market panic is not warranted. As I see market is not panicked but government is. Government it seems runs to RBI and last heard there was hectic discussions. RBI is being cajoled into to do some nasty act. I know anyways desperate times needs desperate measures.

But the real estate economy for the real estate people by the real estate people is doomed to fail

FII's step up sales in bond market

In the previous post, we see that this week will see hectic lobbying by blood sucking corporates and irresponsible bankers to force RBI to cut interest rates.

One interesting analysis I did over the weekend says that further reduction in rates will create a hungama in Indian bond market. The Rupee depreciation along with reduced rates are causing FII's pull out money and it is partly reflecting in equity markets also.

Last week FII have pulled out more than 7000 crores. It is good news for me.

RBI cannot cut rates that easily now.

CHECK MATE MATE.

lobbying week is here

We all know what is lobbying is.

By far, the largest lobbying group I have seen in India is the group of corporate and bank chiefs with tacit or open support from Government of India. The poor victim is Reserve Bank of India. There is a saying in Tamil which goes on like this..Apply.sama, bedha, thana and thanda methods to achieve something. This means do whatever you can to achieve your objective.

This huge lobby group pressurizes RBI by using all these methods to extract favorable monetary policy from Poor RBI who forgets their main mandate. Now next week RBI is expected to come up with their monetary policy for next few weeks. Lobby groups such as 'ready to sell wives for rate cut'  corporates and 'win elections at any cost' politicians are ready to put pressure on RBI governor.

Shameless banker SBI Pratib already started the main song by saying RBI should focus on growth. Why on earth RBI should focus on growth. RBI should not focus on growth. RBI should focus on inflation and currency stability.

However it is expected some emotional blackmailing statements from Chidambaram later this week and also various kind of statements from corporates. Interesting week.

My take is Subbarao will wilt under pressure. Let us see

A intelligent called Swaminathan S Anklesaria Aiyar

Today I read one of the most idiotic article in the main stream media. The credit goes to renowned economic writer mentioned in the title of this article.

He suggested/supported to sell all the buffer stock kept in government godowns.  In fact he suggested to export this food stock. What is comical is this...

He said India needs 32 million tonnes every year as on July 1 in stocks. Even with proposed food security bill India may not need more than 42 million tonnes. But currently India has stock about 76 million tonnes. So he suggesting to export atleast around 25 million tonnes. What is intriguing is that he said by selling 25 million tonnes we will get around 10 billion US$ and he thinks it will bridge the current account deficit.

Dear sir, our current account deficit is in the tune of 60 - 70 billion$ and this 10 billion$ is peanuts and will go into the drain in a jiffy. But the food stock if used properly or given to people can last for another year. You may have born in a upper middle class brahmin family and may not know what is food security is....

However, I never read this guy talking sense in any of his article. He never advised government to increase interest rate so that all the rotten idiots in the indian crony capitalist system comes to ground. Never. he never did that. He always supported government's idiotic moves. Gives reasons for them. Give justification for governments anti-people move.

Dear sir,,problem lies in Interest rates....

Raise interest rates by atleast 2%. This will solve all our problems. Then we need not undergo the painful process of reading your half baked,self fulfilling articles.

Real Estate Regulatory Bill in Monsoon Season

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what a joke?

Holy cow Narayanamurthy

For long corporate India and media mafia praise NR.Narayanamurthy for corporate ethics standards and what not.

Murthy paid back by bringing his son into the company yesterday. One side effect is that K.V.Kamath becomes laughing stock now. But as you know, he became rick and famous only because US money printing and the boom period that followed.

Coming back to NRN's ploy, it is Ok. We Indians donot have rights to call anybody's bluff because we all have skeletons in our cup boards. If you had to arrest somebody for their crimes, we all should get arrested one way or other.

See MS.Dhoni is in newspapers today for all wrong reasons

Interesting times ahead

As usual car sales crashed by 15% this month also.

Govt is desperate to stop gold exports. The idiots who are deciding things in India are not still not understanding or acting too smart. The real reason is interest rate. We NEED TO RAISE INTEREST RATE BY ATLEAST 2-3 %. This will help reducing gold imports.Now govt it seems is openly encouraging gold smuggling by increasing import duty etc. They are not ready to  increase rate and thus deciding to continue raping of common man who trusts our banking system.

'Ready to sell wife for a rate cut' lobby will be active from this week as RBI is going to meet shortly in 2 weeks to decide monetary policy. Poor Subbarao is going to pay for politicians and corporates greed.