Friends,
What we have known by way of pleasent feeling, IMF has endorsed it based on solid data and calculation. It has raised India’s growth forecast to 5.4pc (for China its 7.5pc). In 2010 it sees India growing by 6.5pc in terms of growth rate. IMF has given optimistic out look about the world economy too. This is a very important observation from the angle to judge where the Indian stocks are headed.
Indian market tanked may be on account of the deal makers who may have pinned hope on budget , may be again, as per the promises to them by some in authority. Their accumulation before the event may have pushed them into unloading and fast. There may be the possibility of still more saavy groups to destabilise the public sentiment and later go whole hog for one way buying bout. Since the reason for sell off was misssing, we have to find answer in secretive and concerted action of groups which have always been finding ways to implement the quick gain schemes. Either way we surmise them working, the gains can come to us or them by maintaining the bullish vision about the market till such time where it is costly as per historic parameters or has gone too high too soon.
I recall the times in seventies. I used to read ‘Economic Times’ then, it used to be a serious paper and loaded with authentic information and articles from the learned (unlike today when lighter stuff has been thrown in). I learnt then that the USA’s steel production was 200 million tonnes. We were doing fine with about 6-8 million tonnes. I developed a feeling that if only India could start producing 100 million tonnes of steel, it would be very strong nation without poverty any more, in any pocket.
Today we have targeted 124 million tonnes steel capacity by 2011-12. I feel sorry about no prospect of seeing the poverty eliminated by then.
I may also tell you this is due to the apathy of the govts and not due to paucity of resourses that we have patches of poverty. If only 1 pc of incomes of highest ten percent income earners is transferred to take care of bottom thirty percent, we will see smiles on every face of India. Only thing is to find/develop mechanism (IT enabled) to do it. I am sure the top 10pc will not mind foregoing their 10pc of incomes. Their wealth is going to be reatined in any case. Here I would suggest that there should be an arrangement where the purchses from designated food stores, fees paid to designated schools, mecical bills of designated hospitals and season ticket purchases from railways are reinbursed on production of biils/proof by people/families holding a U-Ipin which should be given as per a criteria and renewable every year. This kind of payment may be put a cieling on. There may still be cases of fraud and misuse but it will be far less in proportion to what has been happening for most schemes aimed at helping masses.
Nifty is trading better this morning in Singapore, so also some of the Asian peers like Kospi,Taiwan, Strait and Shanghai. DOW has closed positive last day.
So, please be a foolhardy person and keep you funds in equities (as far as you think proper according to your appetite). The inflation is bound to raise its head and your umbrella is equity investment, it has always been. If the gold improves in value from here (about Rs 14500/10gms), it will be signal that inflationery times are round the corner. You have to not buy gold but equity after this is signalled.
So, don’t worry, be happy.
HariOm,
krsnaKhandelwal
