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IREF® - Indian Real Estate Forum > Real Estate in India > Real Estate Gurgaon > Real Estate Bubble set to burst again in India
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Old October 29 2012, 11:22 PM   #5011
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Default RBI indicates rate cut likely in its monetary policy review

RBI indicates that rate cut likely in monetary policy review - The Economic Times

Indicating that a cut in interest rate is likely, the Reserve Bank has said despite high inflation it would take steps to support growth in the half- yearly review of monetary policy tomorrow.

"Monetary policy needs to be cautious in the interim, focusing on inflation while using the available space to support growth to the degree it can," RBI said in its macroeconomic and monetary development review.

RBI said the Survey of Professional Forecasters has lowered the GDP growth projection to 5.7 per cent from 6.5 per cent for the current fiscal. Average wholesale price based inflation forecast is revised upwards to 7.7 per cent from 7.3 per cent.

It said the global growth prospects, both in advanced and emerging economies, have weakened and the euro zone troubles have affected business confidence and caused deceleration in global trade.

"Risks of spillovers from global financial markets remain. Unconventional monetary policies have transitorily moderated uncertainties, but the underlying stress has not diminished with incomplete deleveraging and unfinished financial sector reforms," RBI said.

It said sustaining the reform initiatives of the government would be the precursor for a turnaround in economic activity. The government has in the recent past undertaken a host of reform initiatives including hiking diesel prices by over Rs 5 a litre and foreign investment norms for retail, pension, insurance, information and broadcasting sector.

RBI said aggregate demand is weakening, led by the investment slowdown. However, persistent high core inflation remains a cause of concern.

In its last policy review, RBI held interest unchanged, though it had lowered CRR by 0.25 per cent to infuse Rs 17,000 crore liquidity into the system.The RBI said the recent spate of reform measures have helped in arresting the downfall in growth, but called for a greater coordination between different government agencies and removal of structural bottlenecks on infrastructure as the key factors for revival.

"It is necessary to remove the pending constraints in the power, coal and road sectors at the earliest ... Fiscal consolidation and removal of impediments to infrastructure investments hold the key to growth revival," RBI said.

It said there would be fiscal slippages during the year, beyond the budgeted 5.1 percent deficit, and that the final number may not be better than last fiscal's 5.8 per cent.

Earlier in the day Finance MinisterP Chidambaram had unveiled a five year roadmap for fiscal consolidation pegging the fiscal deficit for the current fiscal at 5.3 per cent by bringing in tax reforms and expenditure management.

The budgeted fiscal deficit for the current fiscal was 5.1 per cent. "As macro-risks from inflation and twin deficits recede further, that could yield space down the line for monetary policy to respond more effectively to growth concerns," it said.

The WPI inflation as of September stood at 7.81 per cent, much above the RBI comfort level of 5-6 per cent.

While a majority believes RBI may go in for a cut in the cash reserve ratio (CRR) or the amount of deposits parked with RBI, a few also say a cut in the policy rate (repo) would be a good way of address the issue of sagging growth.

Blaming the high inflation on a wage-price spiral, RBI said, "In the short-run, inflation may turn out to be slightly higher than anticipated ... It is likely to soften from Q4 (January-March period)".

On growth, RBI said, it will fall below its July estimate of 6.5 per cent, but a "modest recovery" can be expected later during the year. Economic growth fell to a nine-year low of 6.5 per cent in 2011-12

 
Old October 29 2012, 11:24 PM   #5012
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Default FinMin P Chidambaram expects RBI to take signals from fiscal road map

A day ahead of RBI's half yearly monetary policy review, Finance MinisterP Chidambaram has expressed the hope that the central bank would take note of steps announced by the government to contain fiscal deficit and act accordingly.

"Well, I am making the statement so that everybody in India acknowledges the steps which we are taking. And also acknowledges the government is determined to bring about fiscal consolidation. And I sincerely hope that everybody will read the statement and take note of that...," he said, when asked whether the RBI would cut rates after taking into account the steps announced by him to contain fiscal deficit.

RBI, which is scheduled to announce second quarter review of credit policy tomorrow, has at many occasions expressed concerns about the fiscal health of the government. It has been advising the government to narrow fiscal deficit so that it gets some headroom to ease monetary policy.

Government has been trying hard to spur economic growth by taking tough measures like opening of multi-brand retail to foreign investment and raising diesel prices by over Rs 5 per litre, to push economic reforms.

During the first quarter of the current fiscal, economic growth had fallen to nine-year low of 5.5 per cent. The growth in factory output in August was also not encouraging as the Index of Industrial Production (IIP) expanded by a nominal 2.7 per cent only.

RBI in its monetary policy have been maintaining that bringing down inflation is its priority. It last cut the repo rate in its annual policy by 0.5 per cent, a reduction after a gap of three years.

Meanwhile, costlier diesel fuelled inflation to 10-month high of 7.81 per cent in September.

Analysts say while RBI continuously fought inflation with 13 successive rate hikes till October 2011, the last rate hike was exactly a year ago.

Since then, the cash reserve ratio-- the mandatory amount of cash deposits banks need to keep with RBI-- and Statutory Liquidity ratio (SLR) have been cut by 1.50 and 1 per cent, respectively.

The repo or short-term lending rate at present is 8 per cent, while CRR is 4.50 per cent.

RBI has also injected liquidity through open market operations worth over Rs 2.1 lakh crore apart from cutting the policy rates by 0.5 per cent in March this year.

FinMin P Chidambaram expects RBI to take signals from fiscal road map - The Economic Times
 
Old October 30 2012, 12:05 AM   #5013
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Quote:
Originally Posted by yogenderg View Post
not sure about gurgaon about bubble burst, but i know a place in rajasthan where properties gave a return of almost 100 - 300% in last 2 years, bust have been correcting now for last 2-3 months...prices have stopped moving upward or have come down by 20-30%.recently got a few calls from brokers in project sare crescent phase 4 where sellers are ready to sell at there booking price without any premium or in era landmark where premium too less to be called a good ROI....does this mean bubble is bursting in gurgaon too?
sir .. it first increased by 100-300 % within 2 yrs right ? so in that sense 20-30% correction is really nothing .. just goes to show that in India in long run one can never lose out in RE investments
 
Old October 30 2012, 01:13 AM   #5014
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Originally Posted by jaijai View Post
Its wrong to say that both congress and BJP are equally corrupt. They are corrupt but the level of corruption differs hugely. Even the most corrupt of BJP is a child by congress standard.

Example - Yedurappa did what SMKrishna did before him. Notice that Lokayutka court has ordered investigation against both. But while Yedi is considered 'most corrupt' of BJP, SMKrisha is one of the most honest of congress lot.
I would say both the parties are equally corrupt. Its just that, BJP is waiting to be in power to reach new corruption limits set by Congress.
 
Old October 30 2012, 08:03 AM   #5015
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I would say both the parties are equally corrupt. Its just that, BJP is waiting to be in power to reach new corruption limits set by Congress.
The data so far shows otherwise. BJP has been in power in many states as well in Center for 6 years. The 'benchmark' of corruption differs between the two. What is called 'corruption' that makes the heads roll in BJP is considered normal behavior in Congress.

Even if I leave aside our political preferences, calling everyone EQUALLY corrupt is the best defense of corrupt.
It may be considered politically correct and put you on high pedestal but absolves the corrupt of any moral turpitude. Everyone is equally corrupt, why should I be singled out?

Beware of Moral Equivalence !!
 
Old October 30 2012, 08:58 AM   #5016
 
 
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Default Housing prices up 6.7% in Q1: RBI

Mumbai: There has been a 6.7 per cent growth in housing prices across the country in the first quarter of the current fiscal, Reserve Bank said today.

"The Reserve Bank's quarterly House Price Index, based on data for nine cities, indicates a Q-o-Q increase of 6.7 per cent at the national level," the RBI macroeconomic and monetary developments report released on the eve of monetary policy announcement said.

On a year-on-year basis, the price increase has been recorded at 24.1 per cent, the report revealed.

The index takes into account price situations in nine cities - Mumbai, Delhi, Chennai, Bangalore, Ahmedabad, Lucknow, Kolkata, Jaipur and Kanpur, it said.

Housing prices in the financial capital grew at a tepid 3.1 per cent for the quarter ended June, while growth in Kolkata was the fastest, at 28.9 per cent, it said, adding Bangalore and Kanpur witnessed a fall.

Going by transaction volumes, there was a 6.4 per cent rise on a sequential basis, the quarterly index showed, while on a Y-o-Y basis it stood at 9.3 per cent, it said.









Housing prices up 6.7% in Q1: RBI
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Old October 30 2012, 06:50 PM   #5017
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Old October 30 2012, 06:57 PM   #5018
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Originally Posted by jaijai View Post
The data so far shows otherwise. BJP has been in power in many states as well in Center for 6 years. The 'benchmark' of corruption differs between the two. What is called 'corruption' that makes the heads roll in BJP is considered normal behavior in Congress.

Even if I leave aside our political preferences, calling everyone EQUALLY corrupt is the best defense of corrupt.
It may be considered politically correct and put you on high pedestal but absolves the corrupt of any moral turpitude. Everyone is equally corrupt, why should I be singled out?

Beware of Moral Equivalence !!
wonderful argument
 
Old October 30 2012, 09:21 PM   #5019
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Originally Posted by jaijai View Post
The data so far shows otherwise. BJP has been in power in many states as well in Center for 6 years. The 'benchmark' of corruption differs between the two. What is called 'corruption' that makes the heads roll in BJP is considered normal behavior in Congress.

Even if I leave aside our political preferences, calling everyone EQUALLY corrupt is the best defense of corrupt.
It may be considered politically correct and put you on high pedestal but absolves the corrupt of any moral turpitude. Everyone is equally corrupt, why should I be singled out?

Beware of Moral Equivalence !!
I am in agreement with this view. In fact, we have to choose among the two and can't ignore them by saying that both are corrupt. This is precisely what Congress would like to hear. We have to take note of the fact that 64 Cr bofors scam was done in 1986 and 1 Lakh bribe case happened in around 2001. 1 Lakh guy has been prosecuted and in fact he was removed from the party post after the case was filed while what has happended to Bofors, CWG, Coal, DLF etc scamsters is for everyone to see.
If someone is waiting for a party which doesn't have a single one who takes bribe then I am sorry we will have to go back to 'satyug' era.

We have to make a choice...
 
Old October 31 2012, 12:14 AM   #5020
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Many of us see the things in black and white only. Either we consider a person squeaky clean elevating him/her to God. Otherwise we swing to other extreme and certify a person corrupt for slightest misdemeanor (or even error).

-2 = -2000 is a wrong argument.

Here is an excellent Article related to this.

Rajat Gupta has been sentenced to two years of imprisonment for what the US justice system considered to be insider trading. Mr Gupta has been a poster boy for India, rising to the highest echelons of business and society — both nationally and internationally. His rise has been meteoric and yet, from what I gather from some of those who knew him and me, he was a humble soul with both feet grounded in the land and culture he grew up in. This particular incident, therefore, has come as a shock to many. It has been like a betrayal to those who held that Mr Gupta could do no wrong.


I am afraid that now, as happens often, people will come out claiming that they knew that Mr Gupta had been doing shady things. They will generate anecdotes from unidentified or dubious sources. People who have held him in high esteem and cannot believe what has happened will find fault with the US judicial system; some will blame his good friend Raj Rajaratnam for luring him, nay entrapping him; some will blame the person who turned state witness to avoid a jail term, while others will refer to the Indian crab mentality (pulling down people who are more successful) when discussing the government prosecutor in the case, who is of Indian origin. And, in the process, we will forget to learn a lot that is to be learnt from this incident. Let us go through some of them.
First, no one is God and there is no reason to indulge in hero-worship. One should appreciate and acknowledge the actions of people and not start worshipping the successful and good people behind highly desirable acts. A good action is to be commended and a bad action is to be condemned. The person behind either of this is not be worshipped, or alternately, condemned. No one could put this better than the sentencing US judge. While mentioning the good soul that Mr Gupta was, he also talked about the fact that many bad things are done by very good people. And the laws in society are supposed to reduce such happenings. The only way to do so is to punish the act, regardless of how good or bad is the person committing it.
Second, a good legal system is blind to the exact standing of the person behind any act. Mr Gupta was powerful, politically and socially. Many petitions were sent to the sentencing judge by the high and mighty, including Bill Gates and Warren Buffett, asking for leniency during sentencing. These were publicly acknowledged by the persons sending them. In other words, the high and mighty were not worried about falling from grace in the eyes of the American public for coming out in open support of Mr Gupta, even after he was convicted of insider trading. Is it because the American public does not care for Mr Gupta’s infractions, or that the high and mighty could be least bothered by what the public thinks about them?
Actually, I think it is neither — and there is something we can learn there. Unlike us, they are willing to accept both the good and the bad in their people. A good person is someone who does more good than bad; a better person is one whose good actions far outweigh her bad actions. They also feel, I believe, that it is unlikely that a person will stay in society around everyone else and never do anything that can be ethically questioned. That person would, indeed, be a saint. And saints are few in number.
102712 21What this allows them to do is to critically evaluate the actions of any person regardless of who the person is or what other actions she has committed. Thus, the fact that you are related to a politician or the child of a powerful government official, or simply that you have tons of money has no bearing on whether or not you will be held accountable for any particular act. The flip side of this is that you will also not be pilloried simply because you have made an error in judgement. After all, God does not live around us.
To me, the Rajat Gupta incident is not a lesson on how the mighty can fall. It is more a lesson in how a mature society deals with its people and the actions they commit. No one is a god or a demon. In India, on the other hand, we go from one extreme to the other. For example, we are restricted from questioning our “stars”. Even simple things like a cartoon, or a tongue-in-cheek public statement about a powerful public figure, can land people in jail. Questioning our own past, especially the things we seem to be proud of as a nation or a community, can land us in serious trouble. And, when someone is powerful, she is God.
So, when the police catch up with someone who has committed an illegal act, the first thing that everyone checks is the social and political standing of the person. If the person is powerful, the police must have made a mistake; if the person has been caught for petty theft before, the person must be capable of murder. Either way, we forget the action and tend to judge the person. Though Mr Gupta said he has lost his reputation, there are many who feel that he is, basically, a good and ethical person. The same people also feel that the insider trading activity of which he has been convicted should not go unpunished. And, while he would have been a better person if he had not done it, he continues to be a person some of whose other actions are best emulated.
 
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