The document discusses India's economic growth and whether it could experience a bubble and crisis similar to Japan in the 1980s-90s. It notes that India's stock market has grown strongly but questions if this is a bubble close to bursting. It analyzes India's stock market performance and P/E ratios, finding the market fell after two years when P/E ratios exceeded 20. This raises concerns current high P/E ratios could lead to a crash. It also notes India's industrial output has recently slumped, posing another threat to economic growth. The document questions if India is on the verge of an economic bubble bursting.
My outlook for the year, written in December last year. Overly pessimistic unfortunately but with Spanish yields now over 6%, we\'re not out of the woods yet! (Pls note I did not write the China stocks or currency section.)
Mercer Capital's Bank Watch | April 2020 | Ernest Hemingway, Albert Camus, an...Mercer Capital
Brought to you by the Financial Institutions Team of Mercer Capital, this monthly newsletter is focused on bank activity in five U.S. regions. Bank Watch highlights various banking metrics, including public market indicators, M&A market indicators, and key indices of the top financial institutions, providing insight into financial institution valuation issues.
Global Financial Crisis and its impact on economic growthKruti Kamdar
What is Financial Crisis?
Definition: A situation in which the supply of money is outpaced by the demand for money.
This means that liquidity is quickly evaporated because available money is withdrawn from banks, forcing banks either to sell other investments to make up for the shortfall or to collapse. A financial crisis is often associated with a panic or a run on the banks, in which investors sell off assets or withdraw money from savings accounts with the expectation that the value of those assets will drop if they remain at a financial institution...
Overview of GLOBAL FINANCE CRISIS and impact with market. Impacts of the US Financial Crisis on Indian Economy. FINANCE CRISIS, Subprime Mortgage Crisis, US Financial Markets, US Unemployment and Stock Market Returns, Treasury Rates and Inflation,
"GLOBAL FINANCIAL CRISIS AND IT'S IMPACT ON INDIAN ECONOMY"Somnath Pagar
In the subsequent parts of the research report, several issues will be discussed which will provide a detailed account of the origin of the crisis (2008-spiraled mortgage crisis, starting in the United States) and the ripple effect of economic downturn of the world„s largest economy which engulfed even the fast growing emerging economies into the crisis. The main aim of the study is to find relevant answers to questions like:
Why and how India has been hit by the crisis?
How the Indian economy and the Reserve Bank of India have responded to the crisis?
Which are the opportunities arisen from the crises?
etc.
My outlook for the year, written in December last year. Overly pessimistic unfortunately but with Spanish yields now over 6%, we\'re not out of the woods yet! (Pls note I did not write the China stocks or currency section.)
Mercer Capital's Bank Watch | April 2020 | Ernest Hemingway, Albert Camus, an...Mercer Capital
Brought to you by the Financial Institutions Team of Mercer Capital, this monthly newsletter is focused on bank activity in five U.S. regions. Bank Watch highlights various banking metrics, including public market indicators, M&A market indicators, and key indices of the top financial institutions, providing insight into financial institution valuation issues.
Global Financial Crisis and its impact on economic growthKruti Kamdar
What is Financial Crisis?
Definition: A situation in which the supply of money is outpaced by the demand for money.
This means that liquidity is quickly evaporated because available money is withdrawn from banks, forcing banks either to sell other investments to make up for the shortfall or to collapse. A financial crisis is often associated with a panic or a run on the banks, in which investors sell off assets or withdraw money from savings accounts with the expectation that the value of those assets will drop if they remain at a financial institution...
Overview of GLOBAL FINANCE CRISIS and impact with market. Impacts of the US Financial Crisis on Indian Economy. FINANCE CRISIS, Subprime Mortgage Crisis, US Financial Markets, US Unemployment and Stock Market Returns, Treasury Rates and Inflation,
"GLOBAL FINANCIAL CRISIS AND IT'S IMPACT ON INDIAN ECONOMY"Somnath Pagar
In the subsequent parts of the research report, several issues will be discussed which will provide a detailed account of the origin of the crisis (2008-spiraled mortgage crisis, starting in the United States) and the ripple effect of economic downturn of the world„s largest economy which engulfed even the fast growing emerging economies into the crisis. The main aim of the study is to find relevant answers to questions like:
Why and how India has been hit by the crisis?
How the Indian economy and the Reserve Bank of India have responded to the crisis?
Which are the opportunities arisen from the crises?
etc.
While our nation faces serious issues right now, there are compelling reasons to consider investing today.
As the nation recovers from the Great Recession, something’s happening that should give investors hope.
Breakfast with Matt Slaughter - The Global Economic Outlook: What's Next?tuckalumni
The Global Economic Outlook: What's Next?
Here in mid-2012, the global economy continues to expand but also to face significant risks. In Europe, the financial crisis of many banks and sovereigns has worsened in recent months. In the United States, growth in employment and output remain slow—and several difficult fiscal choices await the end of the year. Many BRIC-and-beyond countries continue to grow fast—but in China and India, most notably, growth has slowed the past year. This inaugural “Breakfast with Matt” will examine some of the main factors in the global economic outlook.
About Matthew Slaughter
Associate Dean for the MBA Program; Signal Companies Professor of Management
In addition to academic scholarship, Dean Slaughter writes general-interest items for the business and policy communities. Slaughter has also given speeches to and testified before both chambers of the U.S. Congress. His work and ideas have been widely featured in business media.
Syz & co syz asset management - 1 month in 10 snapshots february 2013SYZBank
Every month SYZ Asset Management publishes “1 month in 10 snapshots” a review of global economic activity. Since an image can be more telling than words, every month we select 10 charts illustrating the key data that has marked economic and financial activity over the month, decoding their meaning with a brief explanation.
To
help senior executives weather this economic storm, the Economist Intelligence Unit has updated its
answers to some of the questions most frequently asked by clients, following the publication of the
four previous editions of Global crisis monitor. In answering each question, we outline our current
forecast, explain our thinking, and highlight any key risks or alternative scenarios.
arifanee.com is world's leading website on the hottest financial news, perspectives and behind the scenes stories. arifanees.com brings you insight and information to inspire and transform your paradigm by enriching your with the best of facts and the vision.
arifanees.com
Information-Inspiration-Transformation
The Prospect for Global Economic Recovery and where Bangladesh stands on the ...Md. Tanzirul Amin
The following article was written by me, and was published in the Economic Trends section of the Keystone Quarterly Review (Volume-31) on November 30, 2020: https://lnkd.in/g9nGxzn
The article covers the prospect for recovery of the global economy, and how Bangladesh might perform in its journey across the recovery curve. Moreover, major signs of potential economic recovery and shapes of projected recovery curves are discussed.
Professor Professor Hiroyuki Taguchi - Doctor of Social Sciences (Waseda University) commenced the seminar from a macroeconomic angle with a focus on Abenomics’ influence and the question of tackling mid-income trap in Vietnam. The seemingly dry subject was turned into a fruitful feast of novel information, ideas and well thought-out explanations.
While our nation faces serious issues right now, there are compelling reasons to consider investing today.
As the nation recovers from the Great Recession, something’s happening that should give investors hope.
Breakfast with Matt Slaughter - The Global Economic Outlook: What's Next?tuckalumni
The Global Economic Outlook: What's Next?
Here in mid-2012, the global economy continues to expand but also to face significant risks. In Europe, the financial crisis of many banks and sovereigns has worsened in recent months. In the United States, growth in employment and output remain slow—and several difficult fiscal choices await the end of the year. Many BRIC-and-beyond countries continue to grow fast—but in China and India, most notably, growth has slowed the past year. This inaugural “Breakfast with Matt” will examine some of the main factors in the global economic outlook.
About Matthew Slaughter
Associate Dean for the MBA Program; Signal Companies Professor of Management
In addition to academic scholarship, Dean Slaughter writes general-interest items for the business and policy communities. Slaughter has also given speeches to and testified before both chambers of the U.S. Congress. His work and ideas have been widely featured in business media.
Syz & co syz asset management - 1 month in 10 snapshots february 2013SYZBank
Every month SYZ Asset Management publishes “1 month in 10 snapshots” a review of global economic activity. Since an image can be more telling than words, every month we select 10 charts illustrating the key data that has marked economic and financial activity over the month, decoding their meaning with a brief explanation.
To
help senior executives weather this economic storm, the Economist Intelligence Unit has updated its
answers to some of the questions most frequently asked by clients, following the publication of the
four previous editions of Global crisis monitor. In answering each question, we outline our current
forecast, explain our thinking, and highlight any key risks or alternative scenarios.
arifanee.com is world's leading website on the hottest financial news, perspectives and behind the scenes stories. arifanees.com brings you insight and information to inspire and transform your paradigm by enriching your with the best of facts and the vision.
arifanees.com
Information-Inspiration-Transformation
The Prospect for Global Economic Recovery and where Bangladesh stands on the ...Md. Tanzirul Amin
The following article was written by me, and was published in the Economic Trends section of the Keystone Quarterly Review (Volume-31) on November 30, 2020: https://lnkd.in/g9nGxzn
The article covers the prospect for recovery of the global economy, and how Bangladesh might perform in its journey across the recovery curve. Moreover, major signs of potential economic recovery and shapes of projected recovery curves are discussed.
Professor Professor Hiroyuki Taguchi - Doctor of Social Sciences (Waseda University) commenced the seminar from a macroeconomic angle with a focus on Abenomics’ influence and the question of tackling mid-income trap in Vietnam. The seemingly dry subject was turned into a fruitful feast of novel information, ideas and well thought-out explanations.
The major reasons for the recession that hit worldwide especially the US and Eurozone.
The subprime Crises, US housing Crisis with Facts and Figures and The Fix.
Trekking markets & more with InvestrekkInves Trekk
The report presents a summary of the Indian market activity during the week ended 27 June 2021. It also provides some important insights about the global market trends and Indian Market outlook for the Week beginning 28 June 2021.
Similar to Will India repeat what happened in Japan? (20)
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
Exploring Abhay Bhutada’s Views After Poonawalla Fincorp’s Collaboration With...beulahfernandes8
The financial landscape in India has witnessed a significant development with the recent collaboration between Poonawalla Fincorp and IndusInd Bank.
The launch of the co-branded credit card, the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card, marks a major milestone for both entities.
This strategic move aims to redefine and elevate the banking experience for customers.
How to get verified on Coinbase Account?_.docxBuy bitget
t's important to note that buying verified Coinbase accounts is not recommended and may violate Coinbase's terms of service. Instead of searching to "buy verified Coinbase accounts," follow the proper steps to verify your own account to ensure compliance and security.
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
3. Financial Crisis
The term financial crisis is applied broadly to a variety of
situations in which some financial institutions or assets
suddenly lose a large part of their value.
In the 19th and early 20th centuries, many financial crises
were associated with banking panics, and many recessions
coincided with these panics. Other situations that are often
called financial crises include stock market crashes and the
bursting of other financial bubbles, currency crises, and
sovereign defaults.
Financial crises directly result in a loss of paper wealth; they
do not directly result in changes in the real economy unless a
recession or depression follows
4. Speculation
In the capital markets, speculation refers to the buying,
holding, and selling of securities to profit from fluctuations
in price, as opposed to buying these instruments for use or
for income via methods such as dividends or interest.
Speculation is typically a short-term or intermediate-term
active strategy.
The role of speculators in a market economy are to absorb
risk and to provide liquidity in the marketplace, for the
chance of monetary reward. Speculators provide trading
volume and liquidity in what would otherwise be an illiquid
market without the presence of speculators.
5. Economic Bubble
An economic bubble (sometimes referred to as a
speculative bubble, a market bubble, a price
bubble, a financial bubble, a speculative mania or a
balloon) is "trade in high volumes at prices that are
considerably at variance with intrinsic values". It could also
be described as a trade in products or assets with inflated
values.
6. Financial contagion
Financial contagion refers to a scenario in which small shocks, which
initially affect only a few financial institutions or a particular region of an
economy, spread to the rest of financial sectors and other countries
whose economies were previously healthy, in a manner similar to the
transmission of a medical disease. Financial contagion happens at both
the international level and the domestic level.
At the domestic level, usually the failure of a domestic bank or financial
intermediary triggers transmission when it defaults on interbank
liabilities and sells assets in a fire sale, thereby undermining confidence
in similar banks.
International financial contagion, which happens in both advanced
economies and developing economies, is the transmission of financial
crisis across financial markets for direct or indirect economies.
7. Currency crisis
A currency crisis, which is also called a balance-of-
payments crisis, is a sudden devaluation of a currency
caused by chronic balance-of-payments deficits which
usually ends in a speculative attack in the foreign
exchange market. It occurs when the value of a currency
changes quickly, undermining its ability to serve as a
medium of exchange or a store of value. Currency crises
usually affect fixed exchange rate regimes, rather than
floating regimes.
8. Liquidity trap
A liquidity trap is a situation in which
injections of cash into the private banking system
by a central bank fail to lower interest rates and
hence fail to stimulate economic growth. A
liquidity trap is caused when people hoard cash
because they expect an adverse event such as
deflation, insufficient aggregate demand, or war.
Signature characteristics of a liquidity trap are
short-term interest rates that are near zero.
10. Japanese asset price bubble
The Japanese asset price bubble was an economic
bubble in Japan from 1986 to 1991, in which real estate and
stock prices were greatly inflated. The bubble's subsequent
collapse lasted for more than a decade with stock prices
initially bottoming in 2003, although they would descend
even further amidst the global crisis in 2008.
The Japanese asset price bubble contributed to what some
refer to as the Lost Decade. Some economists, have argued
that Japan fell into a liquidity trap during these years.
11. What actually happened?
In the decades following the Second World War, Japan implemented
stringent tariffs and policies to encourage people to save their income.
With more money in banks, loans and credit became easier to obtain,
and with Japan running large trade surpluses, the yen appreciated against
foreign currencies. This allowed local companies to invest in capital
resources much more easily than their competitors overseas, which
reduced the price of Japanese-made goods and widened the trade surplus
further. And, with the yen appreciating, financial assets became very
lucrative.
So much money readily available for investment, combined with
financial deregulation, overconfidence and euphoria about the economic
prospects, and monetary easing implemented by the Bank of Japan in
late 1980s resulted in aggressive speculation, particularly in the Tokyo
Stock Exchange and the real estate market.
12. Time after the bubble's collapse
(Lost Decade)
The strong economic growth of the 1980s ended abruptly at the start of the 1990s. In
the late 1980s, abnormalities within the Japanese economic system had fueled a massive
wave of speculation by Japanese companies, banks and securities companies.
A combination of exceptionally high land values and exceptionally low interest rates
briefly led to a position in which credit was both easily available and extremely cheap.
This led to massive borrowing, the proceeds of which were invested mostly in domestic
and foreign stocks and securities.
Recognizing that this bubble was unsustainable, the Finance Ministry sharply raised
interest rates in late 1989. This abruptly terminated the bubble, leading to a massive
crash in the stock market. It also led to a debt crisis; a large proportion of the debts that
had been run up turned bad, which in turn led to a crisis in the banking sector, with
many banks being bailed out by the government.
This led to the phenomenon known as the "lost decade", when economic expansion
came to a total halt in Japan during the 1990s. The impact on everyday life was muted,
however. Unemployment ran rather high, but not at crisis levels. This has combined
with the traditional Japanese emphasis on frugality and saving to produce a quite limited
impact on the average Japanese family, which continues much as it did in the period of
the miracle.
13. Aftermath of “Lost Decade”
In response to the recession, Japanese policymakers tried a series of
government economic stimulus programs and bank bailouts.
A 2.4% budget surplus in 1991 turned to a deficit of 4.3% by 1996
and 10% by 1998, with the national debt to GDP ratio reaching
100%.
In 1998, a $500 billion bank rescue plan was implemented to
encourage bank lending and borrowing.
The central bank also attempted to increase inflation (which devalues
savings over time), to encourage consumer spending.
By 2003, the Japanese economy began to recover, helped by imports
from the U.S. and China that helped Japan achieve a real growth rate
of 2%.
15. Indian Stock Markets
The stock market has experienced a strong
comeback from the dark days of the financial
crisis of 2008. The Bombay Stock Exchange
Sensitive Index, better known as the BSE Sensex,
has grown phenomenally beginning 2002.
The question that needs to be answered,
however, is whether this is a bubble, and is it
close to bursting?
16. Table 1- Average December P/E Ratios and the BSE Sensex
AveragePE Ratio in
Year Sensex % Change December
2000 3972 20.84
2001 3262 -17.87 15.59
2002 3377 3.52 14.37
2003 5839 72.89 17.3
2004 6603 13.08 18.15
2005 9398 42.33 18.07
2006 13787 46.70 22.51
2007 20287 47.15 26.94
2008 9647 -52.45 12.16
2009 17465 81.03 21.82
17. Is the Sensex Worth It?
Table 1 compares the average December P/E ratios for
the Sensex from 2000 through 2009 with the percentage
increase or decline in the index.
The Sensex fell only twice during this period; both times
the fall was in the year subsequent to a year in which the
December P/E was over 20. The large fall of 52% in
2008 followed two consecutive years in which the P/E
ratios were high, i.e. above 20. The years 2009 and until
now 2010 have also been two successive years of P/E
ratios over 20.
18. Year Ending DJIA % Change Sensex % Change
1997 7908 3659
1998 9181 16.10 3055 -16.49
1999 11497 25.22 5006 63.83
it is clear that 9 out of 12
2000 10788 -6.17 3972 -20.65
times since 1997, the Sensex
2001 10022 -7.10 3262 -17.87
has moved with the DJIA.
2002 8342 -16.76 3377 3.52 Does this mean that the
2003 10454 25.32 5839 72.89 Sensex most of the time
mirrors the movement of the
2004 10783 3.15 6603 13.08
DJIA?
2005 10718 -0.61 9398 42.33
2006 12463 16.29 13787 46.70
2007 13265 6.43 20287 47.15
2008 8776 -33.84 9647 -52.45
20. Output
Another threat to India’s economic growth is the slump
in the country’s industrial output, which dropped five
percent compared to last year. It was the first fall in over
two years.
In fact, the Indian government had expected a growth
rate of 9 percent by March next year, but now analysts
say India will struggle to grow even 7 percent. While
this figure is still much higher than in Europe or the US,
it is the lowest growth figure for India in a number of
years.
21. Parliament
To add to India’s growing monetary worries, both the
RBI and parliament seem hesitant (or unable) to act
swiftly. Parliament has not yet decided on measures to
lift some economic pain, as politicians simply cannot
reach agreement on which measures should be taken.
Meanwhile, the RBI is unable to ease monetary policy,
something that national banks in other countries such as
Brazil and China have already done.
22. European austerity measures
Another threat to India’s economy are Europe’s
austerity measures to ease the euro-debt crisis.
Harvard University professor Amartya Sen told the
Financial Times that this would lead to a “spiraling
catastrophe”, as these measures will result in lower
demand for Indian products and services.“Given that
these austerity measures will continue for the next
decade or so, the outlook for India’s economy is not
bright,” Mr Sen added.
23. Rupee
The falling value of the rupee to the dollar is another
headache for the RBI.
The rupee has lost over 22 per cent since the beginning of
the year.
Global risk aversion is putting pressure on the domestic
currency as foreign funds are pulling out money. Besides, a
widening current account deficit and concerns of investment
in India is also putting pressure on the rupee.
Economists think the rupee will fall further in coming
months.
24. Next victim?
Economists now fear that India and other Bric countries may
be the next victims of the worldwide economic crisis. For
India, smaller growth would have a disastrous effect on
employment and income, as many Indians would lose their
jobs if the economy falters.
The Indian stock markets have come very close to the danger
zone in terms of P/E values. The daily uncertainty facing the
global markets with respect to sovereign debt, bank
exposure, and slow economic growth make this a
particularly dangerous time for investors. The Indian stock
market is vulnerable to any sudden degradation in investor
sentiment that could be brought on by events foreseen or
unforeseen.