Tread with caution

The govt has won the trust vote and the road for the reforms seems to be clear now. The only disturbing factor is that the time available is very less. The left parties have eaten in to four and a half years in to the indian progress and with just six months in hand the task is uphill. The finance minister has already hinted on the insurance sector and financial sector reforms apart from efforts for disinvestment. I personally feel that six months would not be time enough for any major disinvestment drive. But if the govt can prove that it is serious on the reform front the markets are sure to support any such moves. We might also see some measures like the one proposed by samajwadi party windfall tax. By the very term this seems to be an interesting way and moreover something which would be widely accepatable to the public that the private sector which is making good money while public sector companies are bleeding do share some burden. I have also seen that the govt planners have come face to face with the facts that they need to cut down wastages and plug loopholes which lead to demand in fuel. The policy which is likely to charge excise based on fuel effeciency would be just sending the right signals and manadatory use of green energy would too play its role in reducing dependency on crude. I would suggest the the investors now make infromation based moves and invest in those companies which are likely to benifit from the reforms.

Its hightime we start investing

Dr Manmohan singh seems to have played his cards well and is proceeding to sign the nuclear deal. This is a very positive development and would give support to the markets. I think we need to now take a relook at the markets and shrug off some of the pessimism which has engulfed the market. Another positive news is that the crude has been cooling off and is now below the 140$ a barrel mark. I personally would be taking up some stocks for investment. I am currenly interested in buying tata teleservices, w.s.industries, polymedicure, morepen labs, petronet lng. I would be investing around 15% of my surplus cash into these stocks tomorrow and hopefully once the govt proves its majority we would see some support for the market.

Reality stocks in for a big correction

The real estate stocks are experiencing a huge correction. Most of the stocks including heavy weights like DLF, Untiech, Parsvnath and omaxe are witnessing heavy correction. The basic reason behind this is that they are now in for a phase where there would be a sharp reduction in demand for their products and would result in fall in realestate prices. Many of the companies like Parsvnath and omaxe are in dire need of cash to meet their commitments. Omaxe had earlier pleged its shares to raise money and now the news is that the promoters are intersted in selling a part of their stock to raise money. With interest rates on a rise and likely increase in EMI's there is likely to be a fall in the total disbursement of home loans further adding to the problems of the real estate players. So if you are in for investing in these stocks then dont expect quick returns. You need to be careful and take a long term view of the stocks.

Taming inflation

The RBI today announced steps to curb the money supply in the system by announcing a 50 basic point increase in the CRR to 8.75%. This hike would be in two stages 25 basis points from july 5 and another 25 basic points from july 19. The repo rate has also being hiked by 50 basis points to 8.5%. This is likely to suck of over Rs 60,000 crores from the system. The move would have impact on the economic growth of the nation as the cost of funds is going to increase.
I feel that the govt missed the bus and is now desperate to take short term measures to cut inflation. The fact that no steps have been announced where in it shows that the govt has in mind to keep infalation under control in the long term surprises me. Everytime the govt meets on ways to curb inflation i hope for the same but in vain.
Here are some of my views to curb inflation over the long term.
Lets ananlyze what are the major concerns today. The very first one rising crude prices and with it depreciating ruppee. Both quite out of the control of the govt. So what can be done. We need to promote alternative sources of fuel and energy to cut down the requirement for crude over the longer term. Steps need to be initiated to promote green energy like solar power, wind energy and hydel power. Sources for all these are in abundance here. But no steps have been announced till date on these fronts. Have we ever analysed that kind of fuel we are burning in traffic jams. I think a study on these can be an eye opener for the policy makers. Why not promote buidling highways, bridges to cut down travelling time and thus fuel consumption. Many would argue that the govt does not has enought funds. Here the answer is private public relationship.
Steps need to be taken to promote fuel effecient vehicles. The recent increase in taxes on larger engines sounds funny. Why not classify vehicles as fuel effecient and inefficient ones. Then levy heigher taxes on ineffecient vehicles giving the manufacturers clear signals that they have to move to an effecient regime.
Crop planning is another area where the govt needs to take a look. IN one year we have a bumper crop which may be followed by a shift in farming and the very next year we are scarce in that very product. A planning of the areas according to their suitablity to the crop could not only help in keeping prices under control but also lead to heigher yeilds per acreage helping the farmer as well as controlling inflation.
What the govt seems to be doing today is just short term moves to prepare for the elections. Hope somebody is listening.

Pay per post - any blogger would love to be here

payperpost When i began with blogging i thought its just the simplest way to make money on the net. I had researched the net and found that people have made a seperate earning stream by blogging. I began with my blog and started with what i knew the best Stock markets. I used to visit other blogs and came to know that one can earn by posting posts on one's blog. This seemed to be a great opportunity and i certainly needed to take a look at this. I am glad that i did. I applied for approval by Pay per post and my blog was approved.
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Firstly, why would one like to register here. Because you get an opportunity to post on your blog regarding opportunities provided to you and inturn you get paid for the same.
The registeration process is pretty simple. You need to submit your blogs URL for review. Pay per post will reivew your blog and see if it meets the standards set by them. Before submitting your blog take a look at the terms you need to fulfill.
1. Your blog should be atleast 30 days old.
2. The blog must carry atleast 10 entries in the past 30 days.
3. Blogs with a gap of more than 30 days between one entry and the other are not accepted.
These i feel are purely to keep at bay bloggers who are not serious at their work. The attempt is surely to get in quality blogs.
Once your blog is approved you will be provided your own page which will carry opportunites available for you and also a total list of opportunites available to all bloggers. You can go through their description and the links one need to post along when writing on the topic. The reward attached for the same is also specified and the tone in which one need to write is also specified.
Once you have read the requirements and are sure that you can meet the same you can click on 'reserve this opportunity' button and you would be carried to the next page. You would be provided with a link that you need to paste in your post. Also remember to copy and paste 'my custom tracking image' in the post. Once you have written the post in your blog submit the post and its done.
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When to invest

The key question today for an investor is when to invest and what kind of investments to go for. Should one go for long term investments or one needs to move in to day trading. This will all depend on the kind of funds available with the investors. An investor who has the capability to invest for the long term should keep his funds ready now. With the nuclear twist taking a final turn there could be a sharp fall if the govt falls. This would be an excellent opportunity for the long term investor to park his funds. The advance tax data is expected to be robust and this could lead to short term upward spikes in the market however the trend surely seems to be down with a lot of uncertainity on the political and the inflation front. Another investment opportunity which would come up over the coming months would be the debt market mutual funds. The interest rates are on a rise and the when signals appear in that the rates have peaked and the trend is likely to be reveresed then one should park money in debt funds as this would result in not only good interest income but also capital gains as the reducing interest rate would lead to higher valuations for the bonds.

Inflation hits seven year high

The wholesale price index (WPI)-based inflation rate unexpectedly accelerated to a more-than-seven-year high at 8.75 per cent for the week ended May 31, surprising analysts and policy makers.
Current inflation rate is the highest since January 13, 2001, when it stood at 8.84 per cent. Inflation rate for the corresponding week last year was 5.09 per cent.
Finance Minister P Chidambaram termed the inflation as a "worrying" factor but said the government was confident of bringing down the price rise.
However, more worrying for the government is the fact that the latest surge in inflation is largely driven by rise in food prices.
Planning Commission deputy chairman Montek Singh Ahluwalia said today a good monsoon would strengthen the agriculture sector and bring down prices of commodities.
Analysts also apprehend that the Reserve Bank of India (RBI) may further tighten monetary measures before its quarterly policy review on July 29. The central bank on Wednesday unexpectedly raised repo rate by 25 basis points to a six-year high of 8 per cent, to keep a check on rising inflationary expectations.
The fact that the govt has failed to control inflation is a worring factor for the stock market and is likely to have a negative impact on monday and the future weeks to come.