Tuesday, February 13, 2018

The market was anxious.....



The market was anxious about the full employment and the tightening cycle and the higher bond yields and the lower bond prices... The objective is to achieve the natural or non accelerating (ie constant) inflation rate of unemployment...



RBI must promote hedge investment... to reduce risk... it is like insurance in investment assets...




There are many funds with the commercial banks and those also find ways to equity and debt/bonds market with high returns.... do banks pass on profits to the depositors... NO........, depositors invest money in the stock market, themselves or their agents.......,



True, lower tariff on the raw materials or intermediate goods would involve greater participation in the supply or chain or of value addition by INDIA to increase supply of finished goods........, it would help increasing productivity and lower domestic unemployment increase production and lower prices and increase real wages and export led demand....... for other countries too...



The base year for data to calculate real GDP must be changed back to 2004.... under new methodology.... when inflation has been under control... which is likely to increase real GDP expectations or expected real GDP.... when prices would go down real GDP expectations may rise... a lower price level or lower price level base year could increase relative real GDP (in the current year) to real GDP expectations in the year 2003-04...


Bad timing, infra is labour intensive... Spend on increasing education skills innovation and higher supply or productivity... US may cut down on importing skilled labourforce by investing at home... 



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