Call Money
Notice Money
Definition of Call Money
Definition of Notice Money
FEATURES OF CALL MONEY
CALL MONEY MARKET
REASONS FOR EXISTENCE OF CALL MONEY
IMPACT OF CALL MONEY
Call Money
Notice Money
Definition of Call Money
Definition of Notice Money
FEATURES OF CALL MONEY
CALL MONEY MARKET
REASONS FOR EXISTENCE OF CALL MONEY
IMPACT OF CALL MONEY
It's a current buzz in the banking sectors that the company like Reliance, Airtel , Aditya Birla & many more are going to make their banks soon........
Curious to know the advantages & disadvantages of mortgage? The must read this following presentation to get the real meaning of mortgage. To get more information and advice on mortgage visit https://roebucklifetime.co.uk today!
Seeking for best funds to initiate your investment in India ? Here's the top performing schemes offered by ICICI Prudential Mutual Fund online with most recent updates of NAV and returns.
It's a current buzz in the banking sectors that the company like Reliance, Airtel , Aditya Birla & many more are going to make their banks soon........
Curious to know the advantages & disadvantages of mortgage? The must read this following presentation to get the real meaning of mortgage. To get more information and advice on mortgage visit https://roebucklifetime.co.uk today!
Seeking for best funds to initiate your investment in India ? Here's the top performing schemes offered by ICICI Prudential Mutual Fund online with most recent updates of NAV and returns.
Your Pay Cheque has nothing to do with your retirement savingsProf. Simply Simple
Small savings and investments help in accumulating for your Retirement corpus. Investing in equity mutual funds will help your money grow faster. START Investing early and STAY INVESTED in equity investments for a long time to gain the power of compounding.
Over 54,000 examinees passed the Licensure Examination for Teachers (LET) in both elementary and secondary given in September, the Professional Regulation Commission (PRC) announced Monday. (gmanetwork.com)
We all know Greece is in deep trouble after defaulting on its debt to the International Monetary Fund. Many Greeks blame the austerity measures for much of the country’s continuing problems. The leftist Syriza party rode to power this year promising to renegotiate the bailout.
The Greek economy is shrinking. At such times one of the tools available with government is to tinker with the currency. Unfortunately the Greeks cannot do so because they share their currency with other nations of the EURO region.
Today’s lesson by Prof. Simply Simple attempts to explain you the story of ‘Greece Crisis’ using an interesting analogy.
Interest Rates Explained 2024 What You Need to Know.docxAmit Kumar
Have you ever wondered why the stock market jumps on news about inflation, or why a government's decision to change interest rates sends the financial world into a frenzy? It's a complex dance, but at the heart of it lies the relationship between interest rates and the stock market. Understanding this connection is like decoding a secret language that can help you make smarter investment decisions. Get ready to explore how interest rate shifts shape businesses, consumer behaviour, and ultimately, the prices of stocks you see on the ticker.
From global economic trends to your own portfolio, interest rates hold surprising sway. Let's start with a timeline of major turning points in interest rate history – those moments that sent shockwaves through the markets…
Imagine you've taken out a loan to buy a house. The interest rate on that loan is essentially the extra cost you pay for borrowing the money. Let's say your interest rate increases. Now, your monthly payments go up, leaving you with less disposable income to spend elsewhere. This is just one-way interest rates touch our lives.
The Bigger Picture
At its core, an interest rate is the "price" of borrowing money. Banks charge interest on loans they give out, and they may offer interest on money you deposit with them. Governments even charge interest on bonds they issue! It's a crucial lever in the financial system, influencing how much businesses and consumers spend, save, and invest.
A truly unique example comes from Sweden. In 2009, to encourage borrowing and boost the economy during a financial crisis, the central bank implemented a negative interest rate policy. This meant people actually paid the bank to hold onto their money! While this might sound strange, it incentivized people to spend or invest their cash, which could stimulate economic activity. This policy wasn't without drawbacks, and Sweden eventually moved away from negative rates. But it serves as a fascinating illustration of how central banks can use interest rates as unconventional tools.
Types of Interest Rates
You'll often hear terms like:
• Repo Rate: The central bank (like India's RBI) sets this rate, at which it lends to commercial banks. Changes to the repo rate ripple through the economy.
• Reverse Repo Rate: The rate the central bank pays on banks' deposits with it. This helps manage the flow of money.
• Bank Lending Rates: Rates banks set on loans to businesses and individuals (mortgage rates, car loans, etc.)
Key takeaway: Interest rates are not one-size-fits-all. They play different roles, impacting our pockets and the broader economy.
Now that we understand what interest rates are, let's explore how changes in these rates can send ripple effects through the stock market.
How Interest Rates Affect the Stock Market
Businesses and Interest Rates
Businesses, the backbone of the stock market, feel the impact of interest rates in several ways:
Read full article at newspatron or download PDF.
Financial planning is for everyone. If you're like most people, financial planning might seem very complicated and confusing, and you might not know where to start. However, here are some ideas to help you get started.
This PPT is on creating personal financial plan. Also ideas on creating wealth and also various avenues of investments. This ppt is based on investment options available in India
Lowering your monthly payments with a better mortgage rate can help put more money back in your pocket and, in turn, you can use the leftover cash to pay down your other outstanding Debts.
When you apply for a home loan, it is essential to know the home loan interest rate payable beforehand. Compare the services and interest rates offered by various banks and NBFCs to select a convenient rate and tenor. You can then visit an online interest calculator to know the total interest and monthly EMIs you need to pay.
It’s a Money Thing is a collection of effective and affordable financial education content designed to engage and teach young adults while setting your credit union apart. These presentations and other elements are all customizable with your credit union's logo. Check out Currency Marketing at currencymarketing.ca/money-thing for more information.
LAP LOAN
Loan against Property (LAP)
refers to a secured loan category somewhat like a home loan where the borrower provides guarantee by using his property as security. The right of ownership of the property is still with the borrower, and if for some reason, the borrower is unable to repay the loan amount, the property can always be sold off to pay off the debt.
The maximum loan amount varies from bank to bank and could range from Rs.2 lakhs up to Rs.100 lakhs. The loan amount depends on the property valuation, your income and of-course your repayment capacity.
The maximum loan amount can come upto 80% to 100% of property value for commercial setups and up to 80% for residential properties (This is really variable as it completely depends on the valuation of your property).
The maximum loan tenure in Loan Against Property cases is 15 years.
Be ready to provide security, collateral or guarantors in order to obtain a Loan Against Property, not to mention a long verification process.
Selecting the ideal housing loan is influenced by several factors. It includes the size of your family, type of housing finance, amount of available funds, etc.
Jimmy Vercellino, an experienced professional with mortgage lender First Choice Loan Services, works hard to provide a personalized home loan process for you. Options include FHA and VA loans, fixed / adjustable rate mortgages, Jumbo loans and more. Visit http://phxhomeloan.com
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As our expenses increase, Retirement expenses also will be higher than we think. It is never too late to Start Investing for your Retirement Expenses. A Provident Fund will save, but don't rely only on a Provident Fund investment. Diversify your money into different Investment avenues, like a Mutual Fund which helps to bridge the savings gap.
8 factors Influencing your Asset Allocation - such as Risk appetite of an individual, Returns expectancy, Horizon of your investments, Starting early, Regulating your expenses, Cutting down on your liabilities, etc.
An Asset Allocation helps in providing the right investment mix, takes care of Volatility, Assists in your saving needs while enjoying the benefits of staying invested for the right amount of time.
Till about a decade ago, we stood in long queues to withdraw cash from a bank and then waited painfully in other queues to pay our utility bills.
With the advent of credit and debit cards many of our cash related problems got simpler. The internet allowed us to pay bills at the click of a button.
Today there is a big buzz around ‘e-wallet’ and talk of the death of cash payment. Now it is possible to leave your wallet at home and get through a typical day with the help of a digital wallet, thanks to the revolutionary technologies we are seeing as we advance to a cashless world.
Today’s lesson by Prof. Simply Simple attempts to explain you the concept of ‘e-wallet’.
Mutual Fund Insight Review: With bond prices turning out to be almost as unpredictable as stocks, making the right forecasts on interest rate direction has been quite a difficult task. But this fund has managed it well, earning its good returns mainly through rightly timed duration calls on its portfolio.
We are pleased to share the third edition of the CIO Newsletter.
As usual the focus is on themes that could affect our investors and try to address them in an easy-to-understand manner.
Your feedback and suggestions are much appreciated and we have tried to incorporate some of them in this newsletter.
We hope you find the newsletter interesting.
Let me narrate an interesting analogy to you all today.
On a lazy Sunday night you and your family are relaxing on a couch watching your favorite TV show.
Suddenly, someone rings your door bell. You open the door and it’s your long distance relatives who have made a surprise visit.
While you can’t show your displeasure but you still welcome them and offer a cup of tea or coffee. However, your wife whispers to you that there is no milk at home and all the neighborhood shops would be closed.
So, now you are left with no option but knock your neighbor’s door to borrow some milk for your guests with an intention to return it next day once the shop reopens.
At least your friendly neighbor becomes your savior and saves you from embarrassment.
Today’s lesson by Prof. Simply Simple TM attempts to simplify the concept of ‘Call Money’ for you.
Read the attached PPT lesson for more understanding.
Look forward to your valuable feedback at professor@tataamc.com
As individual we all experience ups and downs in our personal and professional life. Sometimes even an emotional roller coaster ride that you can't quite imagine.
But the ones who show resilience and patience are the ones who can overcome with flying colours.
In the same way, as the economy goes through numerous ups and downs so does some companies and sectors. These companies who move in tandem to business cycles (expansion or recession) are termed as cyclical stocks.
Today’s lesson by Prof. Simply Simple TM attempts to simplify the term cyclical stocks for you.
Look forward to your valuable feedback at professor@tataamc.com
With overheated stock markets, a measure of debt can help balance out the equity risk. Equity-oriented balanced funds serve this purpose, and among the top in this category is the Tata Balanced Fund.
With predictability as its middle name; Tata Pure Equity has been consistently rated between 3 and 4 star in the Value Research ratings for the last ten years. The fund has outperformed the benchmark almost every year in the last decade, that too with a low risk score.
The fundamental theme of the newsletter remains the same -- to dive deeper into economic issues that affect our investors. However to keep it interesting, the analysis has been kept at a macro level without getting into minute details.
We received encouraging feedback on the inaugural issue and we have used the same to improve this edition.
We hope you find the newsletter interesting.
Our work demands often leave us with little or no time to spend with the family. This routine can lead to unwarranted stress and fatigue.
Both work and family are the cornerstones of life, neither of which can be ignored. That is why we need to strike a right balance between work and personal life to lead a happy and a healthier life.
Balancing both aspects of your life means you have to give yourself equally so that one will not suffer at the expense of the other. In the long run, the joy, happiness and fulfilment derived from both are worth the effort.
Investing in balanced funds (also known as Hybrid funds) is not much different. Similar to work-life balance, balanced funds are here to give us the best of both worlds.
Today’s lesson by Prof. Simply Simple attempts to explain the importance of balanced funds.
Look forward to your valuable feedback at professor@tataamc.com
The debate over the implementation of Goods and Services Tax (GST) has been tiresomely long.
GST is a critical reform in spurring growth in the Indian economy.
When it is introduced, GST is expected to make the tax system simpler and will also help in increased compliance, boost tax revenues, reduce the tax outflow in the hands of the consumers and make exports competitive. The new government will hopefully set forth a roadmap for the implementation of GST soon.
Today’s lesson on GST attempts to simplify this concept for you.
how can I sell my pi coins for cash in a pi APPDOT TECH
You can't sell your pi coins in the pi network app. because it is not listed yet on any exchange.
The only way you can sell is by trading your pi coins with an investor (a person looking forward to hold massive amounts of pi coins before mainnet launch) .
You don't need to meet the investor directly all the trades are done with a pi vendor/merchant (a person that buys the pi coins from miners and resell it to investors)
I Will leave The telegram contact of my personal pi vendor, if you are finding a legitimate one.
@Pi_vendor_247
#pi network
#pi coins
#money
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
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
Resume
• Real GDP growth slowed down due to problems with access to electricity caused by the destruction of manoeuvrable electricity generation by Russian drones and missiles.
• Exports and imports continued growing due to better logistics through the Ukrainian sea corridor and road. Polish farmers and drivers stopped blocking borders at the end of April.
• In April, both the Tax and Customs Services over-executed the revenue plan. Moreover, the NBU transferred twice the planned profit to the budget.
• The European side approved the Ukraine Plan, which the government adopted to determine indicators for the Ukraine Facility. That approval will allow Ukraine to receive a EUR 1.9 bn loan from the EU in May. At the same time, the EU provided Ukraine with a EUR 1.5 bn loan in April, as the government fulfilled five indicators under the Ukraine Plan.
• The USA has finally approved an aid package for Ukraine, which includes USD 7.8 bn of budget support; however, the conditions and timing of the assistance are still unknown.
• As in March, annual consumer inflation amounted to 3.2% yoy in April.
• At the April monetary policy meeting, the NBU again reduced the key policy rate from 14.5% to 13.5% per annum.
• Over the past four weeks, the hryvnia exchange rate has stabilized in the UAH 39-40 per USD range.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
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
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @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.
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
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
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2. You're watching the news and they're talking about a
recent announcement from RBI, in which it is hinted
that the interest rates may be raised in the next
week.
The stock market drops the next day.
Why?
INTEREST RATES
3. Before you get all worked up, you should know that
interest rates aren't evil.
They're the price of living in a world that relies
heavily on credit and debt.
If interest rates didn't exist, lenders would have no
reason to let you borrow money.
How Do Interest Rates Work
INTEREST RATES
4. And if you couldn't borrow money, you could never
buy a house or a car, or enjoy many of the other
advantages of life with credit, like buying air tickets
and paying bills online with a credit card.
INTEREST RATES
5. So if interest rates are so
important, how do they work?
In this lesson, I'll help you
understand why interest rates
exist, how they're calculated and
why they change over time
INTEREST RATES
6. An interest rate is the cost of
borrowing money.
A borrower pays interest for
the ability to spend money
now, rather than wait until he's
saved the same amount.
INTEREST RATES
7. For example, if you borrow R100 at an annual
interest rate of five percent, at the end of the
year you'll owe 105.
But interest rates aren't just random
punishments for borrowing money. The interest
a lender receives is his compensation for taking
a risk.
How?
INTEREST RATES
8. With every loan, there's a risk that the borrower
won't be able to pay it back.
The higher the risk that the borrower will default
(or fail to repay the loan), the higher the interest
rate.
That's why maintaining a good credit score will
help lower the interest rates offered to you by
lenders
INTEREST RATES
9. The nice thing is that interest rates work both ways.
Banks, governments and other large financial
institutions need cash too, and they're willing to pay
for it.
If you put money into a savings account at a bank, the
bank will pay you interest for the temporary use of that
money
INTEREST RATES
10. Governments sell bonds and other securities for the
same reason.
In this case, you're the lender to the government and
the interest rate is your compensation for temporarily
giving up the ability to spend your cash.
But remember, savings accounts and government-
issued bonds pay relatively low interest rates because
the risk of their defaulting is close to zero.
INTEREST RATES
11. You should also know that interest rates for unsecured
credit will always be higher than secured credit.
Secured credit is backed by collateral. A home
loan is a classic example of secured credit, because if
the borrower defaults on the loan, the bank can
always take the house.
Credit cards are unsecured credit, because there's no
collateral backing the loan, only the cardholder's
credit score.
INTEREST RATES
12. Long-term loans also carry higher interest rates
than short-term loans, because the more time a
borrower has to pay back a loan, the more time
there is for things to possibly go bad financially,
causing the borrower to default
INTEREST RATES
13. Another factor that makes long-term loans less
attractive to lenders -- and therefore raises long-term
interest rates -- is inflation.
In a healthy economy, inflation almost always rises,
meaning the same rupee amount today is worth less five
years from now.
Lenders know that the longer it takes the borrower to
pay back a loan, the less that money is going to be
worth.
INTEREST RATES
14. That's why interest rates are actually calculated as
two different values: the nominal rate and the real
rate.
The nominal rate is the interest rate set by the
lending institution.
The real rate is the nominal rate minus the rate of
inflation.
INTEREST RATES
15. For example, if you take out a home
loan with a nominal interest rate of
10 percent, but the annual rate of
inflation is four percent, then the
bank is only really collecting six
percent on the loan
INTEREST RATES
16. So how do interest rates affect the rise and fall of
inflation?
Well, lower interest rates put more borrowing
power in the hands of consumers. And when
consumers spend more, the economy grows,
naturally creating inflation.
INTEREST RATES
17. If the RBI decides that the economy is growing too
fast-that demand will greatly outpace supply-then it
can raise interest rates, slowing the amount of
cash entering the economy.
So there must be enough economic growth to keep
wages up and unemployment low, but not too
much growth that it leads to dangerously high
inflation.
INTEREST RATES
18. Let us see the formula of the Current Account Balance (CAB)
CAB = X - M + NI + NCT
X = Exports of goods and services
M = Imports of goods and services
NI = Net income abroad [Salaries paid or received,
credit / debit of income from
FII & FDI etc. ]
NCT = Net current transfers [Workers' Remittances
(unilateral),
Donations, Aids & Grants,
Official, Assistance and Pensions etc]
CURRENT ACCOUNT DEFICIT
Hope you have understood the
concept of Interest Rates.
INTEREST RATES
20. DISCLAIMER
The lesson is a conceptual representation and may not include
several nuances that are associated and vital. The purpose of
this lesson is to clarify the basics of the concept so that readers
at large can relate and thereby take more interest in the product /
concept. In a nutshell, Professor Simply Simple lessons should
be seen from the perspective of it being a primer on financial
concepts.
Mutual Fund investments are subject to market risks, read all
scheme related documents carefully.