morning thoughts...

The markets stays in a range with positive divergence and cozy individual stock movements , as we move closer to election results markets looks more stronger, but hey listen are you all ready for the biggest surprise of the season , do you all remember the upper circuit of last elections 2009 that we predicted well in advance , now are the markets heading for a bumper rise or a crackling fall.

From past few days we have been showing beautiful calls and markets have been dancing to our tunes like a pied piper , well a bunch of stocks is ready for mega gains along with nifty which will shock most of the masses.

So do you all want to wait again and miss the chance like 2009 or catch the train this time , no free stuff can help anyone everytime.
Today 2 -3 bombs are ready to rock the markets - we have already given icici bank 1300 ca of may series on fb and yahoo , another being J... , simplex infra

We have been hearing plenty of 'the worst is over' kind of predictions about the economy lately. As per the official announcements, India's GDP growth has already bottomed out. In addition to this, many believe that if we have a good monsoon, the inflation rate will fall and this will prompt the Reserve Bank of India (RBI) to bring down interest rates. Hopes that a new government will give a big push to reforms have sent the stock markets to new highs. Unfortunately most of the euphoria is backed by little proof of economic recovery. The only ray of hope is some relief on India's deficit problem. For, at least the expectation that the current account deficit (CAD) is set to go lower is backed by tangible data. 

Let us not be fooled by the recent and temporary sharp fall in the CAD. It has come about only because of a huge decline in investments (especially corporate investments). This is a disaster for the country. Without private investment, productive assets like factories will not be created. This will only lead to higher unemployment. The solution to this problem is thus clear. The economy needs policies that will encourage private investment as well as a big reduction in government subsidies. These two measures will ensure that the CAD remains low and the currency remains strong. An improvement in savings rate and corporate investments must be a prioritized goal for the new government we believe

Now to what extent can a lower CAD underscore economic recovery? The CAD tells us that the country's imports are more than its exports. The difference has to be bridged by capital inflows like Foreign Investments (either direct or indirect) and remittances. If the CAD remains low then it is not too much of a problem. However a persistently high CAD can make the economy vulnerable to an external shock and put the currency under pressure. This is exactly what had happened in 2013 when the CAD had touched a record 6.5% of GDP. The government and the RBI had to take extraordinary steps to bring it under control. One year on, there appears to be good news. The CAD has fallen dramatically to just 0.9% of GDP in the March 2014 quarter. So the inevitable question is whether this can be sustained. Unfortunately, it cannot, at least not by the measures adopted by the government. 
The sharp decline in the CAD has only been possible due to a massive fall in gold and capital goods imports. The curbs placed on gold imports have resulted in a sharp increase in smuggling and is clearly unsustainable. The fall in capital goods imports is not something to be proud of. It is merely a reflection of the poor state of the economy. These capital goods imports will pick up only as and when there is an improvement in economic growth and industrial activity. 

Now the key to sustainable improvement in the CAD lies in higher savings and investments. If the total savings pool of a country (both public and private) is not enough for its investment needs, then money will have to be brought in from abroad to fill the gap. This is reflected in a rising CAD as has been the case with India over the last few years. The government has been providing subsidies for various schemes, including unnecessary ones for diesel and LPG. This reckless spending has adversely impacted the public savings rate. Meanwhile, thanks to high inflation, the negative real interest rates have hardly incentivized private savers. And as a result even the private saving rate has fallen to nearly a decade low! Thus the growth in savings has not been able to keep pace with the investments that the economy needs. The end result has been falling GDP growth and a ballooning CAD. 

Now the question is where are the markets headed post budget and what will be the effect on equity and commodity markets , so people get ready as this time it will be the most deceptive and surprising thing , don’t miss the opportunity and know all the advance movements and make the wealth of your life or else miss the train for atleast 3-4 years.

No use tracking and seeing the markets on a daily basis in both equity and commodity markets and making petty profits , this markets wants you all to make hefty and mega profits.

 www.astroeyes.blogspot.in

Openly given calls yesterday – Liberty shoes zoomed 18% , Shasun chemicals rose 19 rs