"Power does not corrupt
men; fools, however, if they get into a position of power, corrupt power."
—George Bernard Shaw (Irish,
1856-1950)
Word for the day
Clishmaclaver (n)
Gossip; idle or foolish
talk.
(Source: Dictionary.com)
Malice towards none
When it comes to choice of words and buses - Arvind Kejriwal is truly an
Aam Aadmi!
First random thought this morning
The democracy in India appears to have degenerated into the worst
form of Feudalism. Egocentricity rather that public and national interest is
palpably driving the policies and administrations.
The elected representatives even claim accolades for repair of
choked drains and broken roads by civic authorities.
Did the writers of our constitution intend to create a new
"Ruling Class" in elected representatives or these people were
actually intended to be "Public Servants".
Investment Strategy 2016 - 2: 10 things to watch
In my view, regardless of the current volatility in markets and
nervousness over Oil, China and geopolitical situation in Europe and Middle
East, the investment strategy should be looking beyond 2016. I am aware that at
these time of heightened uncertainties, investors may be inclined to trade out
the smaller market cycles, but still I would argue that it is worth taking a
longer perspective in order to suitably calibrate (a) asset allocation (b)
return expectations and (c) sectoral preferences.
In my view, the following 10 key factors are critical for the
Indian financial markets, in particular, in next 12-18 months. Investors
therefore would want to keep a close watch on these. Prima facie, these factors
are very generic and may offer no great insight. But, I would like to watch of
these from my colored glasses and see through them the emerging trends.
(1) Revival of investment
cycle
In my view, it will depend on a host of factors like credit
worthiness of borrowers and project undertakers, extent of bank capitalization,
viability of infra sector projects, policy support and investor's risk appetite
to name a few.
(2) Household savings and
consumption
Employment growth and household inflation are key deciding
factors.
(3) Rural Income
Rural wage growth and monsoon are key factors to watch.
(4) Corporate earnings
Watch for pricing power led by demand growth and higher
utilization.
(5) INR movement
Restoring faith of Indian investors and NRIs in INR strength,
export demand, USD relative strength and current account management are the key
factors that need to be watched.
(6) Bond yields
Credit demand growth & fiscal prudence would be key factor to
watch.
(7) Political will
The political will to pursue radical reforms and faster growth
agenda would be a key determinate of the future growth trajectory
(8) Global economic growth
Price stability and consumer demand growth will be the key.
(9) Global flows
(10) Technical trends
In next few days I shall discuss each of these factors in some
detail.
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