Posted at 3:33 PM , on June 23, 2015
What should be your strategy in these volatile markets…?
The market index, like it happens so often, does not tell the whole story. From its peak, immediately after the Union Budget, the Nifty has corrected close to 13%. But, scratch the surface and the real story starts unfolding. You have companies like Sun Pharma, Lupin, and Asian Paints that have corrected over 20% during the same period. Private Banks have been through a similar ordeal. I am not even talking about PSU banks, which have lost half of their value. What does this mean for investors and how to approach markets? Continue reading
Posted at 4:01 PM , on June 12, 2015
Was that the hidden message in the RBI credit policy?
Why were markets sorely disappointed with the RBI credit policy? To be fair, the markets were expecting a 25 basis points cut in the interest rates and that is exactly what Dr. Rajan delivered. The real story was possibly hidden behind the reams of data and text that comprised the credit policy. The message was that India Inc should forget about further rate cuts. Continue reading
Posted at 3:59 PM , on June 12, 2015
How Alexis Tsipras is losing the plot with the EU and the Greeks
Earlier this year, Alexis Tsipras came to power in Greece with a thumping mandate. The Greeks were impressed by this one man’s ability to call the European bluff and abdicate calls for austerity. Tsipras may still have the support of the Greeks, but that may be waning quite fast. Alexis Tsipras and his finance minister have stumbled from one bungle to another. As Greeks slowly reconcile with the need to compromise with the EU stand, Tsipras and his Syriza party may be gradually losing the support of the Greeks. Continue reading
Posted at 5:36 PM , on June 2, 2015
To hike or not to hike rates, gets a lot more complicated
A de-growth in US GDP is not great news for Janet Yellen. For her and the other governors of the US Federal Reserve, the decision to hike rates just gets a little more complicated. Wages and inflation are yet to pick up enough to justify a rate hike. And tapering export and GDP is only adding to the problem. There are three major challenges confronting Yellen and team.
Can US monetary policy diverge?
In practice it will be extremely difficult. Year 2008 saw a globally integrated monetary policy for the first time. Back then, most financial markets the world over were extremely fragile in the aftermath of Lehmann. A unified monetary policy was the only way out. Continue reading
Posted at 5:31 PM , on June 2, 2015
Why India needs to take its gold stash more seriously!
The recently announced Gold Monetization Scheme announced by the government is a small step in the right direction. The call of the moment is a lot more aggression. Let us understand why India needs to take its gold stash much more seriously.
How big is the stash…?
There are no confirmed reports on the gold stash of Indian households. But conservative estimates put the number at around 22,000 tons of gold. Of course, most of this gold is largely heterogeneous in terms of form, quality, purity and value. But, that is off the point. The reality is that Indian households are sitting on a huge stash and they are normally unable and unwilling to effectively unlock its value. Continue reading