Hereby I will prove how the realty boomers arguments are false.

What are the boomers arguments?

1.) Buy today, houses always increase in value in the long run.
WRONG. House prices cannot increase more than incomes in the long run. This is obvious if you think about it. If house prices go up more than people can afford to pay, buying stops, like it has stopped now.
Even Warren Buffett have pointed out that houses don't increase in intrinsic value. Unless there's a bubble or a crash, house prices simply reflect current salaries and interest rates. If a house is 100 years old, it's value in sheltering you is exactly the same as it was 100 years ago. Then came the maintenance as the house didn't renovate itself. It also has taxes, and insurance - costs that always increase and never go away. The price of the house went up about as much as salaries went up.
To put this is simple perspective, vegetable were costing Rs.5-6/kg when 5 digit salary was a rarity.
Today, the prices have gone up by about 4 times but so have the salaries. So, sounds very much like the reasoning people use now when they talk about how much their father's house appreciated "in the long run" without considering that salaries rose a proportional amount.

2.) Renting is just wastage of money.
WRONG. As said before renting is now much cheaper per month than owning. If you don't rent, you either:

* Have a mortgage, in which case you are throwing away money on interest, tax, insurance, maintenance, costs that increase forever.
* Own outright, in which case you are throwing away the extra income you could get by converting your house to cash, investing in bonds, and renting a similar place to live for much less money. This extra income is sufficient for emergency expenses,retirement etc.

Either way, owners lose much more money every month than renters and that's assuming prices don't correct to very high level & everything is smooth in the economy.

3.) As a renter, you won't have any money left as you will spend them on vacations,cars & hence won't have equity/savings etc.
WRONG. Equity is just money. Renters are actually in a better position to build equity/savings through investing in anything but housing. Renters can get rich much faster than owners, just by investing in conservative stocks & bonds.

* Owners are losing every month by paying much more for interest than they would pay for rent. The tax deduction does not come close to making owing competitive with renting.
* Owners must pay taxes simply to own a house. That is not true of stocks, bonds, or any other asset that can build equity/savings. Only houses are such a guaranteed drain on cash.
* Owners must insure a house, but not most other investments.
* Owners must pay to repair a house, but not a stock or a bond.
* Owners lose their money as house prices reduce. The EMI's remain constant in spite of reduction in rates. At the end of loan tenure, they would have paid almost twice than that of current renters who will buy at logical rates. Keep interest rates in mind. Most of the EMI is not principal amount but interest.

4.) There are great tax advantages to owning a house.
WRONG. Many people believe you can just reduce your income tax by the amount you pay in interest, but they are wrong. Buyers may not deduct interest from income tax; they deduct interest from taxable income. And even then, the tax advantage is not significant compared to the large monthly loss from owning.

If you don't own a house but want to live in one, your choice is to rent a house or rent money to buy a house. To rent money is to take out a loan. A mortgage is a money-rental agreement. House renters take no risk at all, but money-renting owners take on the huge risk of falling house prices, as well as all the costs of repairs, insurance, property taxes, etc.

5.) RE is based on local factors, it's not a national phenomenon. RE of Delhi-NCR,Bangalore & rest of the cities has nothing to do with Pune RE.
WRONG. Lending rates remain the same throughout the country. ALL loans are harder to get. This will drive prices down everywhere.

6.) A rental house provides good income. So, you can rent if you have purchased as investment.
WRONG. Rental houses provide very poor income in hyped areas and certainly cannot cover mortgage payments. Remember there is almost 300% difference between EMIs & rent for the same house.

It's pointless to do the work of being a landlord if you can make more money with no risk, no work, and no state income tax by investing in assured good returns bond.

7.) If owning is a loss in monthly cash flow, but appreciation will make up for it.
WRONG. Appreciation is negative. Prices are going down. It only adds to the injury of already high EMI's.

8.) As soon as prices drop a little, the number of buyers on the sidelines willing to jump back in increases.
WRONG. There are very few buyers left, and those who do want to buy will be limited by increasing difficulty of borrowing now that many house owners are near bankrupt as they don't save anything at the end of the month due to high EMI's.
No one has to buy, but there will be more and more people who have no choice but to sell as their payments rise. That will keep driving prices downward for a long time.

9.) House prices never fall atleast in Pune.
WRONG. If you see the RE scenario of 1996, prices crashed by 50% & took a whole 7+ years to recover.
Exact 1996 scenario may not be there today but strong correction is inevitable across the city.

10.) House prices don't fall to zero like stock prices, so it's safer to invest in real estate.
WRONG. House prices won't be zero, but the equity or the principal amount you paid can be zero or even negative. What you will pay as EMIs later in actual terms is not for the principal amount but only the interest as house prices dip. So, you will be only serving the bank.

11.) Prices will soften gradually, won't crash immediately.
WRONG. Prices are falling off a cliff. No one knows exactly what will happen, but it looks like prices will continue to fall for long time. These are just more manipulation of buyer emotions, to get them to buy even while prices are falling.

12.) The bubble prices were driven by supply and demand alone.
WRONG. Prices were driven by low interest rates and risky loans & good returns for investors in initial phases of boom in 2004-05.
Prices went up, interest rates went up & buyers savings went down. So prices are violating the most basic assumptions about supply and demand.

13.) There is lack of land.
WRONG. Ample of land is available & continue to be even in future in Pune. Sales volume are down. Even in Japan (small country with less land), prices went down. Current prices here are the same as that of 23 years ago. If we really had a housing shortage, there would not be so many vacant rentals.

14.) If you don't own, you'll live in a cheap neighborhood later.
WRONG. For the any given monthly payment, you can rent a much better house than you can buy. Renters live better, not worse. There are downsides to renting, such as being told to move at the end of your lease, or having your rent raised, but since there are thousands of vacant rentals, you can take your pick and be quite happy renting during the crash. There are similar but worse problems for owners anyway, such as being fired and losing your house, or having your interest rate and property taxes adjust upward. Remember, property taxes are forever.

15.) There's always someone predicting a real estate crash.
TRUE, yet irrelevant. There are very real crashes every decade or so. Even a broken clock is right twice a day.

16.) Local incomes justify the high prices.
WRONG. The mortgage should be more than your 3 years earning. It is much higher today. Most are already in danger/red zone.

17.) You have to live somewhere.
CORRECT. But that doesn't mean you should waste your life savings on a bad investment. You can live in a better house for much less money by renting during the down slide in RE.

18.) It's not a house, it's a home.
WRONG. Wherever one lives in it is home, be it apartment, condo, bungalow , mansion or house. Calling a house a "home" is a manipulation of your emotions for profit.

19.) If you don't buy now, you'll never get another chance.
WRONG. History proves otherwise.
Here's a beautiful quote from a analyst:-
"The real issue isn't whether you will be stuck being a renter all your life, she says. Its whether you'll get so scared about being shut out that you'll buy at the market's peak and be stuck in a property you can't afford or sell."

20.) It would take major economic recession or a major earthquake that wipes out this area in order for the price to fall by over 50%.
WRONG. Even today, if the prices fall by 50%, there will still be very few people who can buy at this levels due to uncertainty in jobs & most importantly high EMIs. Also, look at the rental rates for equivalent houses. Which loss per month is larger? EMI or rent?

contd....
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  • A big advantage which IT enjoys is they don't have worker unions like manufacturing sector. Due to this, many a times, the real info doesn't come out in the way it should have been other-wise. Had there been union, I am sure, no company would have had parking charges.

    However, once I heard that this is being priamrily being done to encourage car pooling & use of public transport by the employees. However, I doubt this arguement.

    * The bonus is fixed or that too is variable? (do have have Diwali bonus & stuff like that?)
    CommentQuote
  • These Indian IT companies are exploitative.

    You have free parking in most US MNCs and also free or subsidized transport(company's)
    CommentQuote
  • Originally Posted by realacres
    A big advantage which IT enjoys is they don't have worker unions like manufacturing sector. Due to this, many a times, the real info doesn't come out in the way it should have been other-wise. Had there been union, I am sure, no company would have had parking charges.

    However, once I heard that this is being priamrily being done to encourage car pooling & use of public transport by the employees. However, I doubt this arguement.

    * The bonus is fixed or that too is variable? (do have have Diwali bonus & stuff like that?)


    Bonus??? Vo kya hota hai bhai...

    Variable pay hi puri mil jaye wahi bahut hai:):):)

    Actually Media has made a Big picture about IT salaries & that is not TRUE in most of the case....In most of the Indian MNCs (yeah they call themselves MNC, nothing less than that, I mean Infy TCS etc )average salary is around 5 lacs upto 3-4 years works ex which might be shown right from 7-10 lacs (with variable pay)....So, I must say Rosy days of IT is already gone....

    Yesterday I was reading a ad of MSEB's transmission Arm (I forgot exact name) their basic salary of 1 year ex engineer was around 19k, Now you can calculate the CTC (in IT companies term this should be around 5-6 lacs)...which IT companies give 5-6 lacs for 1 year work ex engineers ( Please dont say Google,MS or Cisco, as more than 90 IT junta in india works for Infy,Wipro,TCS etc)... So, this argument that IT ppls are responsible for RE rise is 100% wrong....Easy Access of credit (due to ICICI,HDFC banks) is the ONLY reason of RE price rise, what I understood after following RE for around 2-3 years now:)
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  • Originally Posted by ash7979
    So, this argument that IT ppls are responsible for RE rise is 100% wrong....Easy Access of credit (due to ICICI,HDFC banks) is the ONLY reason of RE price rise, what I understood after following RE for around 2-3 years now:)

    Well, I differ on this. It was IT guys alone who went for such type of credit in most cases. Non IT were more conservative with their spendings. Other factor was the same classmate of non-IT would get pay packet less than that of IT during the boom times. This increased the gap & IT guys started spending the amount, in most case unwisely coz many IT guys earned 25-35k/ month who, if been in manufacturing sector would not have got jobs at first place. Hence, the spending increased.

    Man, look at the total no. of bookings during 2005-2008 & you will find the majority of the clientele was from IT except for some areas like Boat Club Rd., KP, Modibaug etc. You see any new projects on outskirts, it will be dominated by IT.

    * During IT boom, people used to say that their son/daughter is soft_ware engg despite being a mech/civil/elec engg (& working in some IT co.):o though today is a different story.
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  • Originally Posted by realacres
    Well, I differ on this. It was IT guys alone who went for such type of credit in most cases. Non IT were more conservative with their spendings. Other factor was the same classmate of non-IT would get pay packet less than that of IT during the boom times. This increased the gap & IT guys started spending the amount, in most case unwisely coz many IT guys earned 25-35k/ month who, if been in manufacturing sector would not have got jobs at first place. Hence, the spending increased.

    Man, look at the total no. of bookings during 2005-2008 & you will find the majority of the clientele was from IT except for some areas like Boat Club Rd., KP, Modibaug etc. You see any new projects on outskirts, it will be dominated by IT.

    * During IT boom, people used to say that their son/daughter is soft_ware engg despite being a mech/civil/elec engg (& working in some IT co.):o though today is a different story.


    If You dont agree with me, lets ask Jitu that what percentage in Flats in Samrajya are booked by IT guys...And I bet that figure would be less than 50%....I my society in Balewadi almost 50% of the flats are booked by investors & rest 50% by other ppls & these investors are not IT guys...I can defiantly say that out of total flat sell of Flat in Pune at ateast 25-30% booked by Mumai investors (most of those are not IT ppls)...So, these Mumbai Investor are the main reason for RE price rise at least in Pune.....thats why if you see NCR or even Bangalore, you wont see such rates, which you can see in Pune & in NCR has almost equal number of IT ppls working & Bangalore is the IT hub of india....
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  • Nice Discussion, buying a flat(first time buyer) Various google brought me to this site and interesting things being discussed forced me to drop some lines which inturn will help me in deciding about buying a flat. though I have jumped in between a niced discussion, but please bear with me and help me in my querries.

    my budget is not more then 28L for 2bhk, my daughter is in DAV Aundh(jr. Kg) I am looking for a flat nearby. could any one suggest where can i find a decent flat at the same time some light i would be seeking in order to whether I should buy here or in bangalore or NCR.

    Please help.


    Thanks
    Keshav
    CommentQuote
  • Originally Posted by ash7979
    If You dont agree with me, lets ask Jitu that what percentage in Flats in Samrajya are booked by IT guys...And I bet that figure would be less than 50%....I my society in Balewadi almost 50% of the flats are booked by investors & rest 50% by other ppls & these investors are not IT guys...I can defiantly say that out of total flat sell of Flat in Pune at ateast 25-30% booked by Mumai investors (most of those are not IT ppls)...So, these Mumbai Investor are the main reason for RE price rise at least in Pune.....thats why if you see NCR or even Bangalore, you wont see such rates, which you can see in Pune & in NCR has almost equal number of IT ppls working & Bangalore is the IT hub of india....

    Mumbai investors or lets say investors in general did play a big role in hiking prices, but you need to know whom these investors were selling to? It was mainly IT. Had there been investors throughout, rates at PCMC too would have gone up exhorbitantly.
    Kothrud is far off from Vimannagar side as well as Hinjewadi, hence you won't find high no. of IT guys here, though they will form considerable number & these would mostly be locals who want to stay near places of their childhood. For migrant, it hardly matters.

    Just one more point:- Having 50% or more people from the same field is unique. Never did this happen during pre-boom times. As IT constituted the largest no. of END USERS (investors used to sell to ITGs also) & IT guys never questioned the logic of pricing, it led to exploitation by the builders. As said before, ITGs got more than they expected & hence spent more than requried.
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  • IT has just been a catalytic in RE prices increasing and not the sole reason. Sensing that IT people will have better paying capacity, people with loads of money (investors and not IT ppl as they will have money but after slogging many years and that too is a potential depending upon the trade winds flowing in favorable direction), blocked majority of the RE hpoing they will get a IT person or another investor laster. Every next investor was ready to pay higher than the previous one.

    Also many overseas investory a rise of 500 psf does not mean much (they always compare with the overseas prices).

    As Aditi mentioned in some thread that PBAP found a interesting phenomenon. When rates were decreased, there were fewer buyers (all held to money thinking rate will fall further). However on rising prices, more apt were sold . This prolly made them decide on a business strategy of always increasing prices (in a good market) and to reduce only if sales really drop (as happened in mid 2009).
    A rising trend of prices simply reflects that more buyers are still coming to the market who think its worth to buy at current prices.
    CommentQuote
  • Originally Posted by compuwalah
    IT has just been a catalytic in RE prices increasing and not the sole reason. Sensing that IT people will have better paying capacity, people with loads of money (investors and not IT ppl as they will have money but after slogging many years and that too is a potential depending upon the trade winds flowing in favorable direction), blocked majority of the RE hpoing they will get a IT person or another investor laster. Every next investor was ready to pay higher than the previous one.

    Right, I said that above as well. A chain was getting built up, A>B>C....& everyone took their part of flesh & those who were the last, ended up paying more & this price later become the price for 1st buyer for another property & chain started from this line. So, end of one cycle was start of another one & this created a bubble in RE. As there is now no-one at end line, new chain is unable to start while existing chain is incomplete as well.
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  • Even budget flats are not in reach of "IT people".
    CommentQuote
  • US Job losses continue

    Even though rate has slowed down. The job lossing spree continues..

    http://money.cnn.com/2010/02/05/news/economy/jobs_january/index.htm

    "The U.S. economy lost 20,000 jobs in January, but the unemployment rate fell to 9.7%, according to a government report released Friday."

    "The Labor Department also released an annual revision of U.S. payrolls on Friday, using data that wasn't initially available. Losses for 2009 alone came to 4.8 million jobs, more than 600,000 more than previously estimated.The revision showed the economy has lost 8.4 million jobs since the start of the recession in December 2007 -- 1.4 million more job losses than initially reported."

    "The payroll number for December was revised to a net loss of 150,000 jobs. The government had previously indicated that 85,000 jobs were lost in December."

    "Jobs rose by 64,000 in November, up from an initial estimate of 4,000. It is the only month in the past two years in which jobs grew. ="http://money.cnn.com/2010/02/05/news/economy/jobs_january/index.htm#TOP"]""
    CommentQuote
  • Originally Posted by realacres
    Mumbai investors or lets say investors in general did play a big role in hiking prices, but you need to know whom these investors were selling to? It was mainly IT. Had there been investors throughout, rates at PCMC too would have gone up exhorbitantly.
    Kothrud is far off from Vimannagar side as well as Hinjewadi, hence you won't find high no. of IT guys here, though they will form considerable number & these would mostly be locals who want to stay near places of their childhood. For migrant, it hardly matters.

    Just one more point:- Having 50% or more people from the same field is unique. Never did this happen during pre-boom times. As IT constituted the largest no. of END USERS (investors used to sell to ITGs also) & IT guys never questioned the logic of pricing, it led to exploitation by the builders. As said before, ITGs got more than they expected & hence spent more than requried.


    "How you calculated that ITGs got more than what they expected" I have posted in many threads with real examples that salaries of various govt departments are better than the IT companies salary these days, like many college professors are getting salary around 1 lacs/month (posted the real pay scale to prove my point, when it was asked by one of poster) & in this tread too I have posted Basic salary of an engineer working with MSEB & having around 1 year of work experience (19K basic salary), which IT company offer such a salary (plus you better know how much these govt ppls make thru B money)...So its really absurd saying that ITGs are getting more than what they expect (or I think you mean here what they Deserve)....

    Do You know how much salary PSU employees are getting??? No IT company can match salary+benefit, what ONGC's employee get (except Google, MS or couple of more) or say NTPC's engineer get (I got selected in NTPC in 2000 & you know what was there CTC those days,around 7 lacs/annum and usual IT company were offering around 2-3 lacs/annum those days , I wanted to work in Telecom, thats why I didn't go for it, But I must say I must be getting better salary+ Benefits in NTPC now, to what I am getting in my current company & its when my current company is the one of BEST salary paymaster in Pune).....

    Or lets say, do you know how much siemens (electrical) pays to its engineers or maybe volkswagen(Auto) pays to their engineers in Pune...go check & then we can debate further on this topic....

    Now come to the point:Do You think that Investors are selling resale flat to IT ppls & do you know how many such deals happened in Pune in last 2-3 years...You urself many times posted in this forum,that Pune has max # of unsold flats (both Builders & Investor) & if IT guys are buying these flats then how come Pune tops the Unsold flats list in entire country, can you justify this????....Please have a balance view on any topic,when you dont know the facts :D:D:D:
    CommentQuote
  • I need Rapidex English course. Help me!
    CommentQuote
  • Originally Posted by ash7979
    "How you calculated that ITGs got more than what they expected" I have posted in many threads with real examples that salaries of various govt departments are better than the IT companies salary these days, like many college professors are getting salary around 1 lacs/month (posted the real pay scale to prove my point, when it was asked by one of poster) & in this tread too I have posted Basic salary of an engineer working with MSEB & having around 1 year of work experience (19K basic salary), which IT company offer such a salary (plus you better know how much these govt ppls make thru B money)...So its really absurd saying that ITGs are getting more than what they expect (or I think you mean here what they Deserve)....

    Do You know how much salary PSU employees are getting??? No IT company can match salary+benefit, what ONGC's employee get (except Google, MS or couple of more) or say NTPC's engineer get (I got selected in NTPC in 2000 & you know what was there CTC those days,around 7 lacs/annum and usual IT company were offering around 2-3 lacs/annum those days , I wanted to work in Telecom, thats why I didn't go for it, But I must say I must be getting better salary+ Benefits in NTPC now, to what I am getting in my current company & its when my current company is the one of BEST salary paymaster in Pune).....

    Or lets say, do you know how much siemens (electrical) pays to its engineers or maybe volkswagen(Auto) pays to their engineers in Pune...go check & then we can debate further on this topic....

    Now come to the point:Do You think that Investors are selling resale flat to IT ppls & do you know how many such deals happened in Pune in last 2-3 years...You urself many times posted in this forum,that Pune has max # of unsold flats (both Builders & Investor) & if IT guys are buying these flats then how come Pune tops the Unsold flats list in entire country, can you justify this????....Please have a balance view on any topic,when you dont know the facts :D:D:D:


    U forgot about onsite part..the real earnings come from there..:D
    CommentQuote
  • What has that got to do with Chennai (or India) RE?

    Originally Posted by aditi sharma
    Even though rate has slowed down. The job lossing spree continues..

    ]http://money.cnn.com/2010/02/05/news/economy/jobs_january/index.htm

    "The U.S. economy lost 20,000 jobs in January, but the unemployment rate fell to 9.7%, according to a government report released Friday."

    "The Labor Department also released an annual revision of U.S. payrolls on Friday, using data that wasn't initially available. Losses for 2009 alone came to 4.8 million jobs, more than 600,000 more than previously estimated.The revision showed the economy has lost 8.4 million jobs since the start of the recession in December 2007 -- 1.4 million more job losses than initially reported."

    "The payroll number for December was revised to a net loss of 150,000 jobs. The government had previously indicated that 85,000 jobs were lost in December."

    "Jobs rose by 64,000 in November, up from an initial estimate of 4,000. It is the only month in the past two years in which jobs grew. ="http://money.cnn.com/2010/02/05/news/economy/jobs_january/index.htm#TOP"]"


    Aditi,

    Whatever may happen in the rest of the world, none of those things have any bearing whatsoever to do with RE in India (and Chennai and Pune RE in particular).

    If Fiscal deficits in US and UK (at 12%) and deficit in Greece (15%) along with unsustainable debt (87% in US and around 105% in UK and much higher in Greece and Japan) are bringing these countries to the brink of financial collapse, how can you connect this to India's similar levels of fiscal deficit of nearly 12% and Debt to GDP of nearly 70% and say that we are also on the brink? This is blasphemy and you could be banned from setting foot in either of these 2 cities (or even India)!:D. Of course you can always setup your own party, become its General Secretary, hire enough goons and walk right in and nothing will happen to you! :D - examples of General Secys - Amar Singh and Rahul G.

    And, even though much of India's recent growth has come from basically Govt funded projects (of a public nature) and Govt handouts like duty cuts and waivers, don't you know that the Private Sector is growing phenomenally and will soon be hiring like in the boom-boom days of 2003-07 and giving hikes of 20% or more every years?

    Which is why, as India seems completely de-coupled from the rest of the world, while the rest of the world sinks into a prolonged multi-year depression, India will forever grow at 8% and even 10% (that too on a higher base GDP of 2009 and 2010 compared to 2006), though it took an enormous amount of bubbly (credit) even to make its 2007 9% growth happen.

    All of this happens when you set aside mathematics (though there are great mathematicians on this forum who keep it all simple) and simply-fly on sentiment and the power of black money (ignore the fact that black money can also get destroyed like white money when prices go down; and you can't even take tax credit for losses with Black!).

    Just like the rapidly increasing number of fuel-guzzling SUV buyers who will not be affected by sharp fuel price at all simply because they will now be driving their vehicles on petrol and diesel fumes alone, thus avoiding paying high prices for the actual petrol and diesel.

    This sentiment is a great thing in a bull market. And of course, you know its other side when markets turn down (we saw that facet of sentiment in 2008)!!!!

    cheers


    Aditi,

    Whatever may happen in the rest of the world, none of those things have any bearing whatsoever to do with RE in India (and Chennai and Pune RE in particular).

    If Fiscal deficits in US and UK (at 12%) and deficit in Greece (15%) along with unsustainable debt (87% in US and around 105% in UK and much higher in Greece and Japan) are bringing these countries to the brink of financial collapse, how can you connect this to India's similar levels of fiscal deficit of nearly 12% and Debt to GDP of nearly 70% and say that we are also on the brink? This is blasphemy and you could be banned from setting foot in either of these 2 cities (or even India)!:D. Of course you can always setup your own party, become its General Secretary, hire enough goons and walk right in and nothing will happen to you! :D - examples of General Secys - Amar Singh and Rahul G.

    And, even though much of India's recent growth has come from basically Govt funded projects (of a public nature) and Govt handouts like duty cuts and waivers, don't you know that the Private Sector is growing phenomenally and will soon be hiring like in the boom-boom days of 2003-07 and giving hikes of 20% or more every years?

    Which is why, as India seems completely de-coupled from the rest of the world, while the rest of the world sinks into a prolonged multi-year depression, India will forever grow at 8% and even 10% (that too on a higher base GDP of 2009 and 2010 compared to 2006), though it took an enormous amount of bubbly (credit) even to make its 2007 9% growth happen.

    All of this happens when you set aside mathematics (though there are great mathematicians on this forum who keep it all simple) and simply-fly on sentiment and the power of black money (ignore the fact that black money can also get destroyed like white money when prices go down; and you can't even take tax credit for losses with Black!).

    Just like the rapidly increasing number of fuel-guzzling SUV buyers who will not be affected by sharp fuel price at all simply because they will now be driving their vehicles on petrol and diesel fumes alone, thus avoiding paying high prices for the actual petrol and diesel.

    This sentiment is a great thing in a bull market. And of course, you know its other side when markets turn down (we saw that facet of sentiment in 2008)!!!!

    cheers


    Aditi,

    Whatever may happen in the rest of the world, none of those things have any bearing whatsoever to do with RE in India (and Chennai and Pune RE in particular).

    If Fiscal deficits in US and UK (at 12%) and deficit in Greece (15%) along with unsustainable debt (87% in US and around 105% in UK and much higher in Greece and Japan) are bringing these countries to the brink of financial collapse, how can you connect this to India's similar levels of fiscal deficit of nearly 12% and Debt to GDP of nearly 70% and say that we are also on the brink? This is blasphemy and you could be banned from setting foot in either of these 2 cities (or even India)!:D. Of course you can always setup your own party, become its General Secretary, hire enough goons and walk right in and nothing will happen to you! :D - examples of General Secys - Amar Singh and Rahul G.

    And, even though much of India's recent growth has come from basically Govt funded projects (of a public nature) and Govt handouts like duty cuts and waivers, don't you know that the Private Sector is growing phenomenally and will soon be hiring like in the boom-boom days of 2003-07 and giving hikes of 20% or more every years?

    Which is why, as India seems completely de-coupled from the rest of the world, while the rest of the world sinks into a prolonged multi-year depression, India will forever grow at 8% and even 10% (that too on a higher base GDP of 2009 and 2010 compared to 2006), though it took an enormous amount of bubbly (credit) even to make its 2007 9% growth happen.

    All of this happens when you set aside mathematics (though there are great mathematicians on this forum who keep it all simple) and simply-fly on sentiment and the power of black money (ignore the fact that black money can also get destroyed like white money when prices go down; and you can't even take tax credit for losses with Black!).

    Just like the rapidly increasing number of fuel-guzzling SUV buyers who will not be affected by sharp fuel price at all simply because they will now be driving their vehicles on petrol and diesel fumes alone, thus avoiding paying high prices for the actual petrol and diesel.

    This sentiment is a great thing in a bull market. And of course, you know its other side when markets turn down (we saw that facet of sentiment in 2008)!!!!

    cheers


    Aditi,

    Whatever may happen in the rest of the world, none of those things have any bearing whatsoever to do with RE in India (and Chennai and Pune RE in particular).

    If Fiscal deficits in US and UK (at 12%) and deficit in Greece (15%) along with unsustainable debt (87% in US and around 105% in UK and much higher in Greece and Japan) are bringing these countries to the brink of financial collapse, how can you connect this to India's similar levels of fiscal deficit of nearly 12% and Debt to GDP of nearly 70% and say that we are also on the brink? This is blasphemy and you could be banned from setting foot in either of these 2 cities (or even India)!:D. Of course you can always setup your own party, become its General Secretary, hire enough goons and walk right in and nothing will happen to you! :D - examples of General Secys - Amar Singh and Rahul G.

    And, even though much of India's recent growth has come from basically Govt funded projects (of a public nature) and Govt handouts like duty cuts and waivers, don't you know that the Private Sector is growing phenomenally and will soon be hiring like in the boom-boom days of 2003-07 and giving hikes of 20% or more every years?

    Which is why, as India seems completely de-coupled from the rest of the world, while the rest of the world sinks into a prolonged multi-year depression, India will forever grow at 8% and even 10% (that too on a higher base GDP of 2009 and 2010 compared to 2006), though it took an enormous amount of bubbly (credit) even to make its 2007 9% growth happen.

    All of this happens when you set aside mathematics (though there are great mathematicians on this forum who keep it all simple) and simply-fly on sentiment and the power of black money (ignore the fact that black money can also get destroyed like white money when prices go down; and you can't even take tax credit for losses with Black!).

    Just like the rapidly increasing number of fuel-guzzling SUV buyers who will not be affected by sharp fuel price at all simply because they will now be driving their vehicles on petrol and diesel fumes alone, thus avoiding paying high prices for the actual petrol and diesel.

    This sentiment is a great thing in a bull market. And of course, you know its other side when markets turn down (we saw that facet of sentiment in 2008)!!!!

    cheers


    Aditi,

    Whatever may happen in the rest of the world, none of those things have any bearing whatsoever to do with RE in India (and Chennai and Pune RE in particular).

    If Fiscal deficits in US and UK (at 12%) and deficit in Greece (15%) along with unsustainable debt (87% in US and around 105% in UK and much higher in Greece and Japan) are bringing these countries to the brink of financial collapse, how can you connect this to India's similar levels of fiscal deficit of nearly 12% and Debt to GDP of nearly 70% and say that we are also on the brink? This is blasphemy and you could be banned from setting foot in either of these 2 cities (or even India)!:D. Of course you can always setup your own party, become its General Secretary, hire enough goons and walk right in and nothing will happen to you! :D - examples of General Secys - Amar Singh and Rahul G.

    And, even though much of India's recent growth has come from basically Govt funded projects (of a public nature) and Govt handouts like duty cuts and waivers, don't you know that the Private Sector is growing phenomenally and will soon be hiring like in the boom-boom days of 2003-07 and giving hikes of 20% or more every years?

    Which is why, as India seems completely de-coupled from the rest of the world, while the rest of the world sinks into a prolonged multi-year depression, India will forever grow at 8% and even 10% (that too on a higher base GDP of 2009 and 2010 compared to 2006), though it took an enormous amount of bubbly (credit) even to make its 2007 9% growth happen.

    All of this happens when you set aside mathematics (though there are great mathematicians on this forum who keep it all simple) and simply-fly on sentiment and the power of black money (ignore the fact that black money can also get destroyed like white money when prices go down; and you can't even take tax credit for losses with Black!).

    Just like the rapidly increasing number of fuel-guzzling SUV buyers who will not be affected by sharp fuel price at all simply because they will now be driving their vehicles on petrol and diesel fumes alone, thus avoiding paying high prices for the actual petrol and diesel.

    This sentiment is a great thing in a bull market. And of course, you know its other side when markets turn down (we saw that facet of sentiment in 2008)!!!!

    cheers
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