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Honest Information, Profitable Trading

Durudarshan - Investment Analysis

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2015 may be a very good year, but caution ahead

Posted on February 6, 2015 at 7:09 AM Comments comments (12)
Two Thousand and Fifteen may become a very good year, for most nations.

In China, where they recently cut rates and introduced a Trillion Dollar stimulus, the dynamics of internal growth and development as well as for the export markets suggests robust growth.  The Honourable Xi Jinping is quoted as saying that China will achieve a new standard in progress.  His words are welcome, and should give heart to anyone who may be fearing a slowdown in China.  The actual production and shipments overseas ( I hear huge ship loads arriving in Britain, and for the first time in many years hear the trains ferry the goods across in the middle of the night in a huge procession) testify to that.

In the U.S., the start of Prosperity which I had foreseen for November 2014 seems to have materialised, and heatmaps of happiness continue to grow for the people there, with increasing numbers of auto purchases, mortgages taken out on single family units, more people in work both seasonal and permanent, lower Oil prices (although that is a mixed blessing), and good weather, apart from the recent snow.

I see the DOW going upto 18,500* by June this year, although the prospects for 2016 may be mild, with perhaps the saving grace of Hillary Clinton becoming elected as the President.  Sentator Jeb Bush is a strong candidate, but I detect the dynamics at play will ensure the Democrats will again have tenure of the highest position in the land. 

*I am just expressing my opinion, based on the logics of what I perceive.  People should speculate at their own risk.

The Oil producing nations will have to work in co-operation and ensure a stable oil price, otherwise their dollar-denominated revenues will not meet the cost of their imports, and may lead to ques outside empty supermarkets, waiting to buy stocks (g00ds) which are being rationed, as in Venezuela. 
It makes me cringe in shock to see the situation in Ukraine, where the rebels loyal to the Soviet leadership are wrecking havoc and creating ghost towns, where life seems at 1950s levels.  Mr Putin can be generous and call these people off.  He must extricate himself from this very messy situation.  It is doing no one any good.  Once peace is restored in this region, hopefully the Rouble will recover, and help people in Russia share the common prosperity that is developing worldwide.  Oil seems to be bouncing around levels which may be optimum, and which may prove good for everybody, including the newly formed shale and fracking operators.  Mr Putin has to apply the generosity principle, and help the kindred folks in Ukraine.  That conflict is just so unnecessary, it is just like bullying people who at one time Mr Putin was willing to big a brotherly hug.  I just don't believe it.

Under Pradhanmantri Shree Modiji, India is on track for the fastest growth since Independence, although the recent industrial productions figures at 2.6 percent seem so faint.  Provided the RBI decide to enjoin the procession of Recovery and lower the benchmark repo rate, things should improve.  There is a great natural appetite for investment into India, with the right atmosphere.  Creating a major air hub to compete with what exists in the Arab Emirates may be a good raising of the bar, but let us all wait and see what will actually materialise.  But in the meantime, the commencement of building a 100 new cities seems a great vision, and Modiji has my congratulations.  I hope his BJP policymakers and bureaucrats will ensure implementation and fulfilment of such measures.

The caution that I mentioned....while times are good, save a little for the future, and build some reserves for the second half of 2016, when it will all come in handy.


May the Lord's blessings be upon all.


Kind regards,

Durudarshan H. Dadlani


(c) Copyright. 



 





Magnificent, the ECB Stimulus

Posted on January 25, 2015 at 5:08 PM Comments comments (10)
The Trillion Euro stimulus announced this afternoon by ECB President Mario Draghi is nothing less than magnificent in my view, and will help create jobs and industry for millions, and turn into wealth.  This stimulus augurs well for the European stockmarkets and for the Euro itself, which it now underpins with a very positive aspect.  It seems to have been announced at the right time, and although the immediate market reaction may not have been wildly enthusiastic, it is a complex stimulus, needing people to understand and digest its implications.

In plain terms, it is 60 billion Euros per month over 18 months, starting from March to September 2016, meaning a total of 1,080,000,000,000* Euros.  This was announced by Mr Draghi at the press conference in Frankfurt this afternoon.

It will serve the 19 nations that make up the Euro Area, or Eurozone, which now includes as from 1st January 2015 Lithuania.   However, it will not be available at the moment to Greece, which benefits from arrangements already in place from the IMF, which gave them two bailouts and numerous haircuts.  Perhaps there could be cross border mergers of some organisations which would benefit all?

There seems enough appetite for additional funds, especially by companies who have not been able to find funding from the banks so far.  This is a ready segment that will be glad to be served by this Stimulus.  As in England and Britain, where Mr Cameron has been visiting various companies, who have received funding now, something similar needs to be implemented in the Eurozone.  Money invested in companies which need capital for upgrades of machinery, or cash flow to keep the factories operating while their customers arrange to pay them, will maintain employment and sustain livelihoods and, hopefully, even create wealth in the long term.  That 'old school' way of trading had died recently in the credit crunch, and could well do with revival.  It may be the clue to bring Recovery back on stream.


This Trillion Euro Stimulus was long awaited, and probably is just in time, now joining the money flow in the U.S., Japan and China, to maintain the worldwide economic Recovery, which shall flourish to Prosperity for all nations.  The next stage surely must be for the BRICS nations to reduce their benchmark interest rates and for the Emerging Markets to do something similar, in due course to be followed by Africa perhaps?  Or even simultaneously, and soon?  Why not?  The national books can become squared internationally, as each nation develops its resources, trades with the other nations, and brings development and growth at home.  Would that not be the most marvellous thing to happen?


I wish you peace and prosperity, to every nation, man, woman and child.


Kind regards,

Duru-darshan


(c)  Copyright.

P.S. Earlier I left out three 0's.  Aw aw aw!


What would happen if there were no Debt Ceiling raise?

Posted on October 8, 2013 at 3:41 PM Comments comments (6)
Each one can imagine some kind of bleak scenario, in the event that the Debt Ceiling was breached and there was no agreement in Washington between the Republicans and Democrats. 
 
At the moment, the world watches in exasperation as the two sides debate and give a very mixed impression.  As they gleefully remain entrenched as to what they will concede or not, the time is ticking away to 17th October. 
 
Japan and China have wondered at the shutdown, and why it is not being lifted swiftly.  In those nations, such a situation, were it ever to arise, would be reversed as a matter of honour and in the interests of not impeding the economic engine.  It would be done swiftly with a command from the leadership. 
 
In the U.S., by contrast, as is the nature of democracy, every fine detail has to be debated.  That is fair enough, but time is running out nevertheless.
 
In the event that there is no Debt Ceiling raise by 17th October, one can envisage a bleak picture where government will not be able to pay its employees, which of course also includes the Representatives and Senators who have defended very narrow corners and brought about the current shutdown and the furloughs, disrupting peoples' daily routines and reducing their paypackets.  Of course this would have an impact on the economy overall were it to continue for any length of time.  Just over a week has gone, and the mood on the stockmarket has been subdued.  If it were to continue for consecutive 21 days, probably it would cause a disheartening mood, which would dampen the feelings and start a down-turn.
 
Secretary of State for the Treasury Mr Jacob Lew has said there would be about $30 billion for cash-flow, in a 'four trillion dollar enterprise'.  That may be sufficient for 12 days, which would take everyone to 29th October.  If there was no agreement by then, can you imagine anything but the stock markets falling, a fear factor and a lack of confidence, people being laid off by private enterprises as well.  I would bet the Oil price would plummet, demand would be so drastically reduced.  The domino effect would be worldwide, nothing short of alarming.  It would be like looking at Greece in its recent dark days, only the U.S. is a much bigger economy, with over 16 times the population of Greece.  Not only that, what is the sovereign currency of a well-functioning economy and the Reserve Currency of the world would have its standing compromised. 
 
I trust they have some arrangement in place, whether by bi-partisan co-operation, putting aside for the moment the other issues which are dividing them at the moment, and agreeing to a Debit Ceiling raise by 17th October; or, arrangements in place to allow the President to exercise his prerogative under the 14th Amendment and sign in an amount that would be prudent and necessary. 
 
Mr Obama has mentioned that the debt burden has been reduced by Two and a Half Trillion in the last few years, so his Administration's policies have been productive and praiseworthy, pulling the whole economy out of a severe recession and creating a nation with huge heatmaps of happiness, which have  provided growing confidence worldwide.  The sooner the uncertainity regarding the Debt Ceiling raise is removed, the better will it be for the whole world.  America's well-wishers and creditors alike would feel good, a positive mood of certainity and predictability for future growth would continue worldwide.
 
The last Debt Ceiling raise in August 2011 has proved efficacious, and so there would be universal approval and applause for such a measure this once also.  Those who believe in doing right by their fellow humanbeings, let them also do right by the currency that says 'In God We Trust'. 
 
Kind regards,
Duru-darshan.
 

Stimulus? Taper? Where we headed?

Posted on September 27, 2013 at 2:36 PM Comments comments (3)
In his penultimate testimony recently, Federal Chief Ben Bernanke suggested that the QE measures had greatly helped the economy. 
 
The infusion of money did indeed stabilise the economy and create jobs on an on-going monthly basis, helping people buy autos and houses, and adding to consumer confidence in the U.S., which has become one of the fastest recovering nations post the 2008-crash. The QE measures introduced in August 2011 helped to propel the economy from a negative loss of confidence to a positive full of hope and promise and enterprise culture.  The QE measures helped to finance the government departments as well as the social net, and has got some of the pick-and-shovel jobs under way, although not as many as may have been envisaged. 
 
Secretary for the Treasury Jack Lew is characterised as pleading for action on the issue of the debt ceiling, but of course this issue cannot have escaped anyone's attention.  A logical time for resolution of this issue in somewhere mid to end October, when Mr Bernanke may be stepping down, having served his nation in a most admirable way.
 
The $40 billion a month stimulus under the first QE measure must have clocked up a trillion just after two years and one month.  The additional stimulus of $45 billion a month in buying of mortgage-backed securities has been in place for nearly a year, and that tots up another half trillion or so.  All told, the authorised stimulus which was the debt ceiling was around $1.45 trillion, plus a further $700 billion from banks and private or public concerns.  The money has swirled in the system and created much happiness for so many people, and sustained livelihoods and restored confidence, not only in the USA, but around the world.  The dark days were when diamond merchants in India were standing idle, because American men had stopped buying diamond rings for their fiancées.  The whole supply chain from South Africa to Antwerp to Tel Aviv felt the effect.  Thankfully, those days are gone, and we all have to thank the return to confidence that has enabled consumers believe in a good life and live with hope.  When people have received loans and mortgages, their purpose has been filled with joy.  May that continue for the foreseeable future, as hard work and enterprise turn into wealth, going round and serving more.  A growing circle of enterprise and industry in each nation has given added confidence to increased trade as well as growth at home.  When the global locomotive of growth drives along, it is music to the ears of people everywhere, be it China, India, the Middle East, Africa, or South America, not to forget Japan and Australia.  Growth and enterprise is good for the world, as each nation trades their unique resources, creating work and purpose, confidence and enterprise.   
 
The cash-flow that the stimulus measures provided have been a great blessing, creating many jobs, creating many livelihoods, helping many families survive and recover from the savage recession that beset the world, and with the creation of activity, opening of factories and workshops, improving purchase of goods both utilitarian and luxury, improved number of travellers and visitors globally, it seems the economies are set for further growth to Prosperity. 
 
Secretary of Treasury Jack Lew and colleagues will know what measures are necessary.  President Obama and House Speaker Boehner will ascertain what is necessary and prudent for continuation of the economic Recovery.  Positive developments on this with bi-partisan co-operation will herald the path to Prosperity.  Trusting in good judgement, no one should have concern. 
 
Kind regards,
Duru-darshan.
 

Oil price is far too high, despite accomodative policies

Posted on August 8, 2013 at 3:29 AM Comments comments (6)
For a continuation of the worldwide economic Recovery, in my opinion the price of Oil is far too high  - both WTI and Brent, which hit parity recently and have been both in backwardation on the far futures contracts.
 
The holding of or reduction of benchmark rates in accommodative policies is brilliant, and the only way forward.  The Australian Reserve Bank, U.S. Federal Reserve and Bank of England are setting the tone for continuation of Recovery.
 
Mr Raghuram Rajan has been appointed Governor at the Reserve Bank of India, and assumed his post there on 5th September.  In his name are coded the most fond Hindu wishes in Godhead, just as they chant Raghupati Ragav Rajaram.  Hope he will set policies to utilise the various fiscal tools he has at his disposal, and help renew expansionary growth in the Indian economy.  It is noted that he is a gregarious, media-friendly personality, so presumably the world will hear more about what he has in mind. 
 
Oil price at anything above $85 per barrel is too high, and will continue to slow down the world economies.  When people are unable to feed themselves and their children in Yemen and other places, most of the developing world I would surmise, it is time for the OPEC nations to pause and consider what would be best for everybody.  Growing unemployment in South Africa (over 25 percent) and other countries, where social security is not a state policy, does not indicate a robust world picture.  It is imperative that the Oil price be reduced, for continuation of worldwide economic Recovery, which in turn will be able to sustain infrastructure growth in the OPEC and other nations. 
 
Israel with an unemployment rate of over 25 percent could do with international goodwill for their technologically advanced products, and a peace in that region can only help bring the oil price down and help the economies in that region.  In a cooling off of tensions lies the way forward to peace and prosperity.
 
Enlightened souls who help govern the policies, the duty is yours to do the needful.
 
Kind regards,
Duru-darshan.
 
 

What's happening with the economic news?

Posted on August 6, 2013 at 10:08 AM Comments comments (12)
Recently I wrote about the Mormon church, about their production of a spiritual musical called Truth shall prevail, being staged at the Chorley, Preston temple in Lancashire.  My blog had over 1600 reads, mainly from Hongzhou in China.  Thank you, dear readers.
 
At the moment the most alarming news is from Zimbabwe, where President Mugabe has been re-elected, amidst complaints that the election has been rigged.  His comeback has been with the announcements of implementing policies of nationalisation of mining and natural resources companies.  Mr Mugabe obviously does not believe in free-market economics, nor does the devout Catholic believe in forgiveness, which he and inter-alia his nation received after he took over the white peoples' farms and handed them out to his cronies and their clans.  A nation that was once the bread basket of Africa has reduced itself to a state of constant shortages of food in the supermarkets, due to neglect of a farming sector that has lost its efficiency;  and loss of credibility overseas which have hampered imports.  Just like Zimbabwe produced the Billion Dollar notes and failed to appreciate that their currency cannot have the status of a world reserve currency, so now President Mugabe... but wait, this devout Catholic and clever student and man of the world will surely not fail to realize that nationalising assets belonging to international companies will lose international goodwill towards his nation.  And while it may be very profitable in the short term, in the long term it would be like taking a slow poison.
I pray President Mugabe's  good sense will prevail and he will not decide on such a brutal policy. I hope this man who likes to be portrayed on his country's postage stamps in the manner of a sovereign, follows policies which will leave his country a legacy where they can trade and interact with the rest of the world as a free market economy, for years to come.   Let there not be a time when the nation once again degenerates into a period of stupor and complacency, like recently when so many years were lost due to loss of goodwill abroad and lack of scientific know-how in the country. 
 
The kind gift of globalisation has been the awareness of the spirit that only with co-operation and fairness in dealings can all the nations prosper, by developing their natural resources and exchanging them with others on a fair basis.  To punish the intermediaries of such development, the international companies who operate within the boundaries and jurisdiction of every nation, would not be a welcome gesture.
 
Mr Mugabe's pronouncements have caused market jitters in the short term.  Hopefully he will heed the wise counsel of his Ministers and allow the development of his nation's enterprises continue with international know-how, expertise and capital. 
 
I have many friends from Zimbabwe at the church, and I wish them and their President well.  I hope Mr Mugabe reads my words, and heeds the advise I offer.
 
Kind regards,
Duru-darshan.
 

Mixed signals about the economic picture

Posted on July 30, 2013 at 8:08 AM Comments comments (2)
There seem to be mixed signals about the economy. 
 
The OPEC countries exported oil worth $1.27 Trillion last year, so that much wealth has been created for their economies and the nations who trade with them.  What is baffling is the high Oil price, which in my calculation is far too high to sustain Recovery.  Couple that with an observation made by Prince Al-waleed bin Talaal that in view of increasing shale gas production, especially in the U.S., the world is less reliant on oil from OPEC, meaning declining demand in years to come.  Most OPEC nations' infrastructure development projects would stay on line were the price per barrel no less than $85, that was according to Sheikh Al-Naimi and Sheikh Al-Badari as well as the Algerian oil minister about a year ago. 
 
The housing numbers from the U.S. on the Case-Schiller map have not been as robust as was expected; indeed, housing starts have been the slowest for 18 years.  While reduced inventory is holding up prices, there needs to be much more construction activity.
 
In the meantime, Lakshman Achuthan of the Economic Cycles Research Institute, who looks at the leading indicators, suggests he has seen figures to indicate a slow-down, which would probably show up in the real economy in another four-five months time.  Corrective measures by government and big corporations in creating jobs and a resurgence of confidence could help to avert that scenario. 
 
All humans like to eat and drink well, dress well, live in comfortable housing, have good transport, have good entertainment, read books, listen to music, watch movies, play in the park, go on holidays, and so on, and people always have aspirations that the economy - in the combined efforts of all to innovate, develop, utilize and monetize all that God has put on earth - will help them with improving standards of living.  That is what everyone wants. 
 
Good news from the U.S. is that they are creating about 150,000 or more jobs each month, and today sees the announcement by Amazon of the creation of 5,000 jobs at their HQ.
 
I suggest a lower Oil price would help Recovery regain its sure steps, for a worldwide economic Recovery.  I pray for that.
 
Kind regards,
Duru-darshan.
 
 
 

Hello Hounslow and Visakapatnam....

Posted on April 25, 2013 at 12:16 PM Comments comments (28)
Hello readers in Hounslow and Visakapatnam!  Glad to see your visits to my website.
 
Swami Ramdev's herbal products and consultations for health are available from
855 High Road, Goodmayes, not far from Tesco.  The phone number is 0208-590 7900.
The shop is open only on Saturdays, otherwise by appointment.
 
Mr Wilson there is a very good masseur, especially for frozen shoulder.
 
Patanjali Yogpeeth products are also available from Sira's Cash and Carry, Hounslow.
 
Online from www.natureandherbs.com  who can send you products from Glasgow.
 
 
The Bank of England has extended its Lending for Funding programme for another year.
Hopefully capital will become available in the way of simple to apply for and readily obtainable loans for enterpreneurs and small businesses through the High Street banks. If printed money is going to turn into wealth, that would be one way of doing it.  People have the courage to borrow and invest and thrive, and once the bankers start their lending with gusto, it will become a jamboree in England.
 
The figures from the ONS this morning show the UK economy growing at 0.3 percent for the first quarter of this year.  Considering the weather was severely cold with snow during January, the weather being fine now should indicate even more improvement in this current quarter. 
 
Cheers!
Duru-darshan.
 
 

How stimulating!

Posted on March 7, 2013 at 4:30 AM Comments comments (5)
Cup of herbal tea, a little square of chocolate....?  Perhaps a cup of decaf, smooth as milk?
 
Today is Thursday, when the Bank of England and the ECB will issue some statements regarding
the interest rates (which are already at an all-time low) or other measures to stimulate the economies
in Europe.
 
After the recent aggregate £375 Billion pumped into the U.K. economy, Sir Mervyn King has to ponder the question of whether another £50 Billion stimulus would be prudent and necessary.  Are the MPC allowed to open their minds to him? 
 
If I had the privilege of sitting on the MPC (which I would welcome at some point in the future, even gratis), I would suggest looking at it this way:  the recent stimulus of £375 Billion quantifies at around for a population of 66 million, at £5681 per head.  By contrat, the U.S. economy, with a population of 330 million, has had a recent stimulus post-2008 of 3T, quantifying at $9090 per head.  At current exchange rate for cable, that is £6060 per head in U.S., so the U.K. would be justified in doing another £379.60 per head, or....well, simple multiplicaion by 66 million....another £25 Billion or so to bring it to par with the U.S. (who will be probably stimulating further).
 
The British landscape shows a picture of shops which are not too busy, but you can't blame people for not spending what they haven't got.  The average social security payment is between £42 and £92 per week, just about enough to eat some simple food and drinks, so money for buying clothing or beds or curtains and such things is a bit scarce, compared to the bankers bonuses (being awarded from money which the banks are hoarding from the stimulus).  More of the stimulus needs to go to retail customers, either through increase in social net, or through direct lending at sensible rates, so the poor don't become victims of the sharks.
 
An additional stimulus of £25 to £50 Billion would be in order, I believe.  Not only that, to feed in an additional £5 per head may require stimulus of upto £275 Billion in due course, leaving scope for another £225 over the next year or 18 months.  That really would be sufficient to stimulate the economy in England, and make it the green and pleasant land it is, with a landscape of thriving businesses and factories, and restaurants (Chinese, Indian, Italian, Greek, Thai, Lebanese, et al), and proud house-owners and expensive cars being driven at a sedate pace. 
 
Such is how it should be, Sir Mervyn.
 
Kind regards,
Duru-darshan.
 
 
 

India's 14th 5year Budget

Posted on February 28, 2013 at 4:57 AM Comments comments (3)
Both the Sensex and Nifty have drifted downwards, at the Budget announced by Finance Minister Chidambaram, which allocates increased expenditure by 19 percent to 2014, with a good measure for defense spending as well as additional provisions for Food Secuirty as well as additional provisions for Mid day meals. 
 
It is a Budget that has at least averted the sovereign debt downgrade, although such a downgrade would have been questionable in view of the fact that the debt to GDP is a golden 5.3 percent, making India worthy of a Golden AAA rating, in my view.
 
The good news for the middle class is that for first time buyers, there is a tax rebate of upto 1 lakh on house purchases upto 25 lakhs.  This will put more people on the ladder to house ownership, and provided the economy remains robust, should give a boost to the housing sector.  Demand for housing is of course at a high.  In this regard, a favourable proposal to create a Women's Bank is an Indian first, which will empower women entrepreneurs, and will certainly be the segment to invest in, as women's prudence, thrift and enterprise is a legend.  So, well done to the authorities for creating this dedicated segment for women's empowerment.
 
Cigerettes, liquor, imported cars, bikes and mobile (cell) phones above 2,000 Rupees are going to incur additional taxation, and those who eat in the more UMC air-conditioned restaurants are also likely to pay additional taxes.  There will be a surchage of 10 percent on incomes over 1 Crore, and those lucky people will have to fork that out for only one year.  Imported cars will become kudos, attracting additional taxation, but those who can afford will not be put off from purchasing such luxuries.
 
It seems a good sensible Budget, although the opposition have called it dull, boring and unimaginative.  Indeed the Chief Minister of Uttrakhand says it is a budget that is anti-poor. and makes no or scant provision for the Scheduled Castes and Scheduled Tribes.  It is apparent that the government will have to focus on this segment, and ensure that in a spirit of equality and inclusion, some extraordinary provisions are to be made for these segments, to propel improvements for all, starting from the lowest upwards.
 
A nineteen percent increase in expenditure over the next year leading to the 2014 election will ensure a renewed growth, and if fairly implemented, this Budget will definitely lift the doom and gloom that has so far weighed on the Indian markets.  This is a great positive Budget for growth, and the Finance Minister deserves congratulations.
 
Kind regards,
Duru-darshan.