Tuesday, February 24, 2015

Should we wait for the cows to come home?

Thought for the day
"The liberty of the individual is no gift of civilization. It was greatest before there was any civilization."
-          Sigmund Freud (Austrian, 1856-1939)
Word for the day
Gregarious (adj)
Seeking and enjoying the company of others.
(Source: Dictionary.com)
Teaser for the day
Should the government take a step back on Land Bill or stay put?

Should we wait for the cows to come home?

In October 2014 I cautioned against relying too much on PM's luck for investment gains. It is reasonable to believe that after 15yrs in power, PM Modi will eventually run out of luck some day.
The point to ponder is "Do we need to provide for contingency now or may wait till the cows come home, like our Public Sector Banks do?"
Many events have occurred in past one month that are noteworthy. The delirium arising from high ICC World Cup fever should not obliterate the sight of these events. For example,
·         After failing to secure a simple majority on its own in Maharashtra, Jharkhand, and J&K, BJP suffered a demoralizing defeat in Delhi assembly elections. It is important to note that -
o    It had to put aside the acrimonious election campaign in Maharashtra to form a sweet 'n' sour coalition with its natural ally SS;
o    In Jharkhand it initially formed a tentative government with AJSU, but to have stability it had to absorb the breakaway group from bitter rebel Marandi's party;
o    In J&K it is reportedly climbing down from demand of rotation CM and also compromising on core issue of Article 370 to form a coalition with PDP;
o    In Andhra Pradesh BJP is an inconsequential coalition partner of TDP. Recently, the relations have soured over BJP's contemplation to invite the rival TRS to join NDA government at center.
o    In Punjab also BJP is an inconsequential partner of SAD and relations have been worsening at local level due to poor performance of the coalition state government.
o    In Bihar, the Manjhi fiasco has certainly dampened the spirits of local unit and is also likely to assembly elections due later this year.
o    The by-poll results in UP post May' 14 have not been encouraging.
o    The three term MP chief minister is consistently under attack for various irregularities and scams.
o    In Delhi it's local unit is already showing deep concern about the municipal elections (still two years away).
·         The Brent crude price is already 33% higher from the US$45/bbl it touched in January 2015.
·         To test the resolve of the finance minister, the former RBI governor Bimal Jalan has proposed violation of red line on fiscal deficit drawn under FRBM Act.
·         The incumbent RBI governor has not hesitated a bit in invoking "Hitler", in what is being seen as a veiled warning to the PM himself. Bad Omen!
·         Food prices have obdurately refused to fall despite whatever effort the government has made.
·         The recent Petrogate corporate espionage case will certainly sour the relationship between the government and some top industrialist. The "feel good" may "feel little less good" in Mumbai. The reputable Deepak Parekh has also hinted at diminishing feel good last week.

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