Indian Stock Market

See the posting/discussion on [ISG:63458] Re: IT sector - oversold?
KKP
PIYUSH SHAH wrote: > Thanks for sharing your thoughts on U. S. & globe. Fortunately or > unfortunately I am not from U.S, I am in Mumbai so I can only guess > the global & U.S. economy. Does The Unemployment will be cause of > worry for economic growth & revenue generation for U.S. economy, will > the govt. > tight visa permission to up country to generate more local employment? > Also will affect more to It companies of India or other industries > also of Indian origin? > > Piyush > On 9/11/07, *KKP_Investor* > wrote: > > > The US eco is slowing down, and the signs can be seen clearly if > you are > in the US, catering to corporate/enterprises clients. All of the > original investments in 1996 to 2000 are now becoming obsolete. > Therefore the investment cycle of reinvesting in telecom and computer > infrastructure is what is keeping our economy alive. The sub-prime > market is going to hit the next earnings releases hard for the Sep > quarter and a bit of the reality of how bad things are in the > marketplace is going to show up. > > Weakening of the $ is going to continue, but inflation is going to > come > within the favorable range (due to the cooling of the eco), and > therefore increase the chance of Fed Cutting Rates. A cut in > rates is a > huge boon for the economy, although it all depends on how many > foreclosures we see in the next few weeks. There is a saying called > “Three Steps and a Jump” > > If the US weakens, it is going to take Europe with it, and > therefore the > markets in China, India, and other Asian countries is going to get > affected. > > Again, we have some time for us to get hit with all of the possible > negative scenarios, so we have to wait and see. > > Lastly, the oversold condition of the US markets, the possibility of > rate cuts, upcoming elections in 2008 and current stabilization of oil > pricing will play favorably for the US markets. > > KKP > > > > PIYUSH SHAH wrote: > > Thanks for the post, do keep updating. Upart from interest rate cut > > scenario > > can you focus on various other issues which I had raised in > different > > thread under P.S. > > such as inflation, currency conversion ratio, yen, oil price, gold, > > etc. how they will affect to u.s. market > > and the world economy in the whole? > > > > Piyush > > On 9/7/07, *KKP_Investor* > > >> > wrote: > > > > > > Here is an article that may be of interest to you…..Please > provide > > your views and comments. > > > > Deepakji was nice enough to post this to his web site also at: > > http://www.stateofthemarket.net/newsletter.htm > > > > > How to Predict Rate Cuts and What Do You Do Next? > > > > We are all waiting for a big decision to come down from > Ben. This is > > the new Ben that has no patterns to his talks, speech, and > special > > lingo. We are all new to him, and the world awaits the big > decision > > on Sep 18th. Well, it seems that the recent discount rate > (a very > > special kind of rate) cut and a good level of liquidity-filled- > > injections seems to have given the market on a global basis, > some kind > > of stability. Interest rate sensitive instruments had a > huge spike > > down due to the recent turmoil and are now bouncing up, with > all of > > the cash on the sidelines coming to work. > > > > So, how do we predict what is coming……Well the answer is too > > simple. Just look at the Fed Fund futures - to get the best > estimate > > of upcoming Fed actions is to learn to read the futures > market. The > > Chicago Board of Trade does big business in futures > contracts on Fed > > Funds rate , and if you can master a little bit of simple > math, those > > contracts are the closest thing we’ve got to a peephole into > Ben’s > > heart/soul. They are predicting a 100% probability of a > rate cut at > > the Fed’s September 18th meeting. The 2 and 3 year > Treasury Notes > > are yielding 4.3%. This also means that we will have a 100+ > basis > > points of Fed Fund rate cuts over the next year. In > addition, lets > > look at the 5 year Treasury Note yield at 4.4%. This is also > > ridiculously low that the Seniors banking on FD/CD income > are really > > hurting. This is incredibly low rate compared to the > Inflation Rate > > and the Fed Funds rate. IMHO, additional rate cuts have to be > > factored in these low rates cause these futures reflect the > entire > > marketplace’s collective wisdom about what the Fed is going > to do with > > the prices of the futures set by real traders risking real > money. > > > > Personally, I believe that there is no better company than PIMCO > > following interest rates, bonds, and other income generating > > instruments. I have a lot of money invested in PIMCO (and > Blackrock) > > funds myself. Why? Simple. They pick the best bonds, > follow the > > interest rate market very closely, and manage a very large > number of > > bond mutual funds (closed end and open end). They believe > that there > > will be a 100 basis points cut in the Fed Fund rate in the > next 12 > > months, with a 50 basis point cut at the Fed’s September > meeting!!!!! > > I am not so sure about the 50 basis point cut, cause that > will send > > too strong a signal in the marketplace, almost making the > rate cut > > bearish. So, I’d be happy with a 25 basis point cut on Sep > 18th. > > But, hey, we are now debating ‘how much’, and not > questioning ‘if’ > > they are going to cut it! > > > > Couple the timing of all of this with the fact that 2008 is > election > > year, and the Republicans need more than a prayer to be > selected, esp. > > with strong candidacy from the Democratic side. In the > meantime, the > > war is draining resources, putting US into a deeper debt all > the way > > around. In addition, our young soldiers are dying every > day, and when > > one tries to talk to the parents of that 20 some old son or > daughter, > > it hits home very hard, and very quickly on what we are > doing out > > there in foreign land. Back to Bernanke’s stance…..He > will be under > > pressure to keep the economy humming along, get this > MBS/Sub-Prime > > behind him, and do a few rate cuts. > > > > So, if you are US based investor, start jumping into > interest rate > > sensitive instruments like I am doing, and if you are in the > Indian or > > Chinese markets, then keep your long term positions in tact, > since a > > bigger bull market is on the way with the US MBS/Sub-Prime issue > > looking like a flu when you look back 6 to 12 month from now to > > Sep’2007…. > > > > KKP > > > > > > ps: US might also start the reduction in interest rate cycle > > throughout the world….. > > > > > > > > > > > > >