Friday, November 28, 2008

Where does it lead to

Next what??

The militants will be killed...Most of the hostages will be rescued, and we will forget the fact that Shivraj patil is useless until the next incident happens...

And we will also ignore Mr. Raj Thackeray's lack of leadership qualities during this time of crisis. And we will continue to remain the same.

Same??

Oops..It is not Same...It is SHAME

What is the course of action for the country? The PM has already blamed the neighbour, though our own people in the form of militants within the country are going to be eventual culprits.

War on the neighbour...No, pleeaaaaaaaaaaase? Yes, I will be consindered as a weak hearted person, but an outright war on a sovereign nation where the people do not hate, but only are under the mask of perceived hatred is not the solution.

Infact, we should go out on war against the militants.. Even Pakistan is not in a poistion to take away the Taliban and the AL-Qaeda from its hideouts.

Prepare a joint force and eliminate every islamic militant from the book and corners of both the countries. We can combat better by being together than holding each other necks.

In spite of all this, We will continue to ignore and remain oblivious to the events happening to the other people around us, and remain aloof of anyone's sorrows.

We will continue to blame the government and still elect the similar people in the next elections. We will stop questioning the government using the RTI.

No wonder can couple of militants with couple of handguns can scare 10 million people to make them stay indoors.

Even I am a fish in the same pool, just worried about my future and not willing to make any sacrifices, not willing to take any bold action.

All that I am doing right now, is blaming the authorities and trying to force myself to remain calm.

Only future can tell, where will this inaction lead to.

Thursday, November 13, 2008

Single digit inflation…good news or bad news??

In the amidst of all the good news, there is a silver lightning in the form of the news that the inflation has finally reached single digits. For the last week, the inflation came down to around 8.5% from around 10% in the previous week.

But is it really a good news? I think this is more of a warning of the forthcoming.

With a drastic decline in the IIP growth rates, and the average money available to people it was but pertinent that the inflation would come down.

But I think this is eventually leading to a deflationary trend. If things happen at the same pace as they have been happening, there is every chance that deflationary periods will be looming around in no time.

Consider this in the upcoming months:
a) Production decreases
b) Exports go down
c) Affordability of people go down
d) Fuel prices go down
e) Money available to people goes down
f) Negative perceptions towards the economy increases
g) Will not speak much about the exchange rate. It may remain the same or depreciate further, let's assume it hovers around the 50 mark for some time.

With all these events happening, the rates are going to come down quite drastically and eventually there will be a negative inflation observed, which is called as deflation.

Isn't it good to me if there is deflation? Obviously no, because:
1) The future value of the money becomes more than the present value and hence no investment will happen.
2) Banks will be flooded with deposits and the incentive to run business decreases
3) Salaries, which are ideally pegged to inflations, will tend to decrease and hence the per capita income of the people decrease and hence the eventual decline in consumption.

I am not sounding pessimistic, but I certainly would not want a deflation at this point of time because there will hardly be anything left with the government to bring back the economy from recession.

I hope I've exaggerated and that Iam wrong.