Fortnightly Summary: Taper, Inflation, Slowing Growth, Network 18

No Comments » Written on December 19th, 2013 by
Categories: WeeklySummary
  • Look, We Have A US Taper!

    The US Fed decided on a $10 billion taper today . From buying $85 billion worth securities per month, they will buy only $75 billion worth, including $35 billion of Mortgage Based Securities (MBS) and $40 billion of government bonds. …

    • RBI Says They’ll Wait Before They Hike Rates

      The RBI, in it’s mid-term policy review, has not changed rates. The repo rate remains at 7.75%. This is the rate at which banks borrow overnight from the RBI. Let me decode the statement in simple terms. We Aren’t Raising …

      • Welcome to Even More Inflation: Govt Plans to Increase Buffer Stocks by 50%

        You thought inflation was high? It might get higher. The government plans to buy a heck of a lot more cereals, wheat and rice, and store them and let them rot. This reduces what you and I can buy from …

        • [Premium only] Macronomics: The Whopping Inflation Put In Context; Mr. Diesel Did It!

          This week, we speak of inflation. Let's look at the Wholesale Price Index Release. First, a quick note. Thanks for the tremendous response to Capital Mind Premium! I've mentioned on the site that we have extended the Capital Mind Premium …

          • Cooper’s Appeal Against Apollo Tyres Dismissed; Apollo up 40% in 5 months

            The Delaware Supreme Court dismissed Cooper Tire’s appeal against a lower court ruling that Apollo was meeting its obligations as part of their $2.2 billion merger plan . Apollo bid $35 per share, but Cooper had complained that Apollo is …

          • WPI Inflation for Nov 2013 at 7.52%, Big Past Revision, Trend Looking Up

            Wholesale Price Inflation for November 2013 was a fourteen month high of 7.52%, the highest since September 2012. Since Inflation is looked at on a Year-on-Year Basis, we look back at how the data looked a year back. The Index …

          • NSEL Update: Lots of Attachments, Very Little Real Money Coming Back

            After a long time, an update on NSEL. The commodity exchange that was basically a large ponzi scheme has unravelled into what seems to be something where everything is wrong and regulators are tying themselves in knots about where to …

          • [Premium Only] Premium: Strides Arcolab Declares Rs. 500 Dividend, a 56% Yield – Good Deal?

            This is an archive for Capital Mind Premium subscribers, sent on 14th December 2013. The Case of Strides Arcolab Strides Arcolab recently sold it’s Agila Specialties division to Mylan for $1.75 billion. They will now use the money to cut …

          • [Premium Only] Premium: What We Could Expect of IIP Today

            This is an archive for Capital Mind Premium subscribers; this was sent by email on 12th December 2013. A Reminder For Trial Subscribers If you’ve been on the trial subscription before November 15, your trial will expire on December 15, …

          • There is No Liquidity Problem. But Will Rajan Raise Rates?

            Ahead of the December 15 intermediate tax payment due date, liquidity in the system is not at all tight. With the 14-day term repo increased to 48,000 cr. (more than the otherwise normal 38,000 cr.) banks are borrowing using that, …

          • CPI Inflation for Nov 2013 at a Whopping 11.24%

            Consumer Price Index based inflation for November 2013 is at 11.24%, based largely on rising food prices. The WPI (wholesale price) data will be out on the 16th. Food inflation is at 14%, while many of the other components seem …

          • IIP for Oct 2013 at -1.8%

            The Index of Industrial Production (IIP) for October 2013 has come in at -1.8%. By large components, every piece of the pie has fallen. Mining (weight:15%) has fallen to -3.5% growth, and Manufacturing (75% weight) has fallen to -2%.  …

          • Bank Credit Growth Falls to 14.3%, Lowest Since July

            Scheduled Commercial Bank Credit is now at 56,650 crores, which is growing at a rate of 14.3% over the previous year. This is now closing in on the 1 year low of 13% we saw in July 2013. Credit growth …

          • Chart: Trade Gap to Nov-13 at $100 bn, November Second Best Month of Year

            The Trade Deficit continues to increase at a slower pace, now up just 5.9% to just under $100 billion in the April-November time. November itself saw a trade deficit of $9.2 billion, the second lowest number this year. The year-to-date …

          • US Banks Can’t Prop-Trade, says the Approved Volcker Rule

            The Volcker Rule is in . US Banks can no longer engage in proprietary trading. The rule was proposed by the 86-year old Paul Volcker who is famously credited for destroying inflation in the late 70s/early 80s and is now …

          • RBI Buys $4 Bn, Sells $5Bn in Forwards in Oct 2013

            The monthly RBI Bulletin tells us how RBI trades in the forex market, with a 2 month lag. In October, the RBI bought $9.5 billion (mostly from banks with the FCNR NRI Deposit Swap), and sold $5.6 billion (both in …

          • [Premium Only] Premium: What’s With The Nifty EPS Crash When We Hit All-Time Highs?

            Thanks to those of you that attended the Capital Mind Premium Webinar on Saturday! We addressed the Current Account Deficit and looked at some interesting charts and numbers. This is an archive of the Capital Mind Premium post sent on …

          • Corporate Loan Defaults Rising and It’s The Banks’ Fault

            Outlook has a great article about corporate defaults. Accor­ding to the All-India Bank Employees’ Associa­tion (AIBEA), bad loans have gone up from Rs 40,000 crore in 2008 to Rs 1,90,000 crore in 2013. “In addition to the official bad loans …

          • Even at All-Time High, The Nifty Must Double From Here to Adjust for Inflation

            As the Nifty hits a new high, it’s useful to see Nifty adjusted for inflation - that is, despite the fact that the Nifty has hit the highest ever value, what does it mean for you once adjusted for inflation?…

          • Nifty Hits All Time High at 6400 on State Election Result Euphoria

            The state election results are out: the Congress has been decimated in nearly all of the four states for which results were announced yesterday. (It is, however, leading in Mizoram, where results are being declared today) With a BJP majority …

          • BitCoin Crashes 50% After China Stops Banks from Handling It

            In a couple days, the Bitcoin price at Mt. Gox, a large Bitcoin site, crashed from $1,200 to less than $600, recovering marginally to $750 today. China has banned financial institutions from handling Bitcoin transactions, says Bloomberg : The People’s …

            • NTPC Closes Tax-Free Bond Offer Early, 3.3x Subscribed

              With a 330% subscription, NTPC decided to close it’s tax-free bond issue much earlier than the scheduled date of close (December 16). The original bond issue of Rs. 1,000 crore (with an additional 750 cr. if there was demand). The …

              • 60 Years of India’s GDP: The Fall of Private Consumption and the Rise of the Government

                Any country’s Gross Domestic Product consists of: GDP = Govt. Expenditure + Private Consumption + Investments + Inventories + (Exports-Imports) If we were to plot these over the last 60 years, here’s how they have been, as a % of …

                • [Premium Only] Premium: The Green Shoots In the Indian Economy

                  Note: This is an archive for Capital Mind Premium subscribers, sent on 03.12.2013. While I’ve been bearish for a long time, the time has come to admit certain facts as data comes in. You don’t fight a central bank. And …

                • Surprise! They’re Smuggling Gold!

                  I’ve been saying this for a long time. That if you try to stop gold supply from outside, they’ll smuggle it in. The smugglers are now winning the gold war. India, in an attempt to stop a large current account …

                  • Manufacturing PMI for Nov 2013 Returns to “Expansion”

                    The HSBC Markit Purchasing Managers’ Index (PMI) for November 2013, (Manufacturing) shows a return to growth territory . Remember, values about 50 are “expansion” and below 50 is contraction. Since August we had gone to below 50, and in November …

                    • [Premium Only] Macronomics: Decoding GDP and the Scary Drop in Personal Consumption

                      This is an archive of a Capital Mind Premium post sent by email. If you haven’t already, Subscribe now! This week, we have a piece on the Indian GDP and its implications to us. On Nov 30, we had a …

                      • RBI Ends OMC and FCNR Swaps; Refiners Buying Directly From Forex Market

                        RBI has mentioned two interesting things . One, that oil refiners are buying dollars directly from the market, since last week, and not from RBI directly through the OMC swap. In August 2013, due to the tumoil in the forex …

                        • The Remarkable Story of Network 18

                          Rahul Bhatia has a fantastic post on Network 18 , over at the Caravan. Capital Mind is mentioned in the post! “From a finance perspective, it’s a company built to pull wool over shareholders’ eyes,” Deepak Shenoy, who runs the …

                          • Related Posts Plugin for WordPress, Blogger...
                            About the Author:
                            http://www.capitalmind.in
                            The man behind Capital Mind. Deepak is a co-founder at MarketVision, a financial knowledge company. Deepak also provides data research and consulting services, and now lives in Bangalore. Connect with him at deepakshenoy@gmail.com.

                            Leave a Reply