Glodyne Tech Ltd, was asked to be bought in yesterday's Sunday Report to the Paid Members, as I found the scrip has more or less bottomed out. The stock hit the buyer freeze in the opening trade.
Twilight Litaka Pharma Ltd hit a buyer freeze in the mid-afternoon trade. I have spoken with the sources and at present there is no news of selling stake in the company to PE funds. The investors should use suitable opportunity to book profits in the counter.
Tomorrow RBI is expected to cut a token, 25 bps of Repo and 25 bps of SLR. I do not think that RBI would cut both the Repo and CRR at the same time. I say this because, our former RBI Governor, Dr. Y.V.Reddy mentioned the benefits of WPI Inflation and why it is the preferred measure for inflation in one of his lectures (Inflation in India: Status and Issues, 1999). Therefore, though CPI is the preferred measure worldwide but in India it seems WPI, has more acceptability as the main measure. But then this eccentric team headed by Dr.Subir Gokarn and presided over by a too simple gentleman named Dr.D Subbarao, can do anything. RBI governors should be shrewd and should work with the government. Instead what we find is a total, lack of co-ordination between the Governors and the FMO. So, the questions is: should RBI be continued as an independent body or it be merged with the FMO? If all the wheels of the system are not well oiled, the system might not move at the desired speed. If only the inflation figure is the guage to cut, REPO RATES, then I think the Government of India, can appoint my neighbourhood, "Pan-walla or Rickshawalla" to do the same--as it is a no-brainer. In this way, few laks rupees, of tax payers money in the form of salaries to the RBI governors could be saved. Isn't it? When the Industry is laden with huge debt burden, when the non--food credit off-take plunges to four year low (CLICK HERE), when the companies cannot carry out their capexes and is burdened with huge NPAs, when the economy is nosediving or moving towards stagflation, etc, these fellows are busy targeting inflation......Huh!! Rome Burning, Nero Fiddling!! If the economy collapses, will anyone survive? A collapsing economy like that of Greece, could bring in catastrophic chain reactions, like sudden massive depreciation of the INR against the USD, increase of FD (and CAD), galloping inflation and so on. The markets will celebrate the day, Dr.Subir Gokarn leaves the RBI corridors. Many marketmen are talking of fall of core inflation numbers, but the truth is that the general public has little to do with WPI, though some RBI governors might like its flavours. The CPI is now reaching almost double digit mark from the creeping stage, proving that these kinds of policies of keeping high interest rate is not helping anyone. I do not know how COST PUSH INFLATION can be brought down by keeping the rates high for so long!! Really Strange..!! The interest rate burden compounds every year, giving the cost a push. In such a situation, it should be dangerous to keep interest rate high, because the cost of production would continue to increase, as there would be interest on interest and interest and interest if the debts are not serviced properly. In case of small farmers, a high interest regime and tight liquidity accompanied by more stricter NBFC lending norms could literally push them to private money lenders, pushing up the cost of production even higher. Besides, lack of infrastructure development could further push up the transportation cost. However, there is a group of stubborn economists world wide who use the same BRAINLESS procedures to bring down inflation. Indian governors are also applying the same medicines to cure a more technical issue. Large amount of money would only give rise to a rise in price if there is a high spending. Isn't it? Without spending will a reasonably large supply of money raise the price of products? The problem is that Economics is not science and very few good brains generally comes to this stream.
A nagging fact is that: after Engineering, Medical (including Pharmacology), Physics, Chemistry, Micro--biology, Mathematics, Molecular-biology, CA, ICWAI, Law, etc, what is left, generally become ECONOMISTS (except may be a very few cases here and there). That is why we see, rubbish and bookish economists, most of the time.