Are you really making money?

raosrinivas · #11 12th March 2008, 11:18 PM

Quote:

Originally Posted by deepsa52

Agreed, but that is not a sign of an emerging super power . Software and goods/services can be consumed domestically instead of providing cheap labor and selling good quality cashews and shrimps to Americans

. In any case some industries have to suffer.

First , we have to become competitive .
Second, you have some mis-conceptions about America. US is a great country. 90% of inventions and discoveries made in the last 300 years are from US. Americans are very innovative, hard working and professional. there is a lot we can learn from the US.

deepsa52 · #12 12th March 2008, 11:26 PM

Quote:

Originally Posted by raosrinivas

First , we have to become competitive .
Second, you have some mis-conceptions about America. US is a great country. 90% of inventions and discoveries made in the last 300 years are from US. Americans are very innovative, hard working and professional. there is a lot we can learn from the US.

No denying it, US has been ( or had been ) a great country - but don't really agree with what has been happening for past 8 years. No misconceptions either, since I live in US. It is just a matter of how one sees it

beginner_av · #13 12th March 2008, 11:38 PM

Quote:

Originally Posted by raosrinivas

Americans are very innovative, hard working and professional. there is a lot we can learn from the US.

What the hell? You are wrong, wrong and wrong again. Most of them are foolish, emotional and lazy. There are only a few bright ones who made conditions so conducive that all the best talent from the world landed over there.

Offtopic
God bless RBI. My books, data and so many things are so much cheaper now. When will the $ give me Rs 10?

deepsa52 · #14 12th March 2008, 11:52 PM

Quote:

Originally Posted by beginner_av

s who made conditions so conducive that all the best talent from the world landed over there.

That is changing fast - people are immmigrating more to Canada and Europe - who wants the dollar? Not me I am short.

raosrinivas · #15 13th March 2008, 12:03 AM

India has a trade deficit with the US, China has a trade surplus so don't you think Indian currency is fairly priced more than chinese yuan ?

deepsa52 · #16 13th March 2008, 12:15 AM

Quote:

Originally Posted by raosrinivas

India has a trade deficit with the US, China has a trade surplus so don't you think Indian currency is fairly priced more than chinese yuan ?

India's trade deficit with US is small change compared to US's deficit with rest of the world. Fairly priced is something vague, in 80s Indian Rs was less than 20 a dollar.
You may think its fairly priced if you are an exporter or a wealthy individual.
Lets wait for an year and see how it plays out. I am just a trend follower, either way does not matter much to me personally ; but the current situation looks very bad to me from the Indian middle class point of view.

raosrinivas · #17 13th March 2008, 12:39 AM

you seem to know a lot about India than me, i did not know india exports cashews / shrimps to the US.

good night. time to sleep for me now.

thanks
Srinivas

deepsa52 · #18 13th March 2008, 01:24 AM

Well, $200billion did not hold up dow for a day...more action.

kkseal · #19 13th March 2008, 01:43 AM

Quote:

Originally Posted by deepsa52

My opinion is what is being done by RBI is *nowhere* near enough..that is just my opinion. Please take a look at USDINR=X at finance ***** for three months. I understand the point on exports, but debasing the currency for exporting to a bankrupt economy like US may back fire.

All I am saying is this not good for the poor people or middle class.
It might work for traders like you.

The RBI has raised rates by 200 basis points - this means you pay more interest for every Re you borrow. It has also hiked the CRR - which means banks have to deposit more with the RBI & have less to lend. Both these measures make the INR more precious, not 'debase' it.

Does raising int rates benefit the common man? A basic aspiration for an 'aam admi' is to own a home Today he has to pay a lot more towards home loan installments than he had to 2 yrs back (on the same principle). Imports have benefited, but then i wonder what % of the common people benefit from imported goods & services (& if it's at the expense of domestic goods & services then more people are likely to be affected than the handful that benefit).

Forget IT, some of our most labour intensive sectors like textiles, gems & jeweleries, leather goods, auto ancillaries even farm products are dependent on exports for a large chunk of their revenues. Can you imagine the job loss in these sectors if exports were to go down the drain?

The $ has come down against all currencies, not just the INR. China has been artificially propping the Yuan (& this has been a bone of contention at the WTO) or else the Yuan-$ exchange rate would have been much higher than the INR-$.
Ideally all currencies should be allowed to appreciate/depreciate freely, without fiscal/monetary intervention (I don't know if this part of the WTO agenda but should be). This would mean that no country would be able to garner any unfair advantage in the global trading arena & the quantum of exports would be solely the function of availability, competency & efficiency. But this is hardly the case in the real world.

Regards,
Kalyan.

deepsa52 · #20 13th March 2008, 01:58 AM

Quote:

Originally Posted by kkseal

The RBI has raised rates by 200 basis points - this means you pay more interest for every Re you borrow. It has also hiked the CRR - which means banks have to deposit more with the RBI & have less to lend. Both these measures make the INR more precious, not 'debase' it.

. China has been artificially propping the Yuan (& this has been a bone of contention at the WTO) or else the Yuan-$ exchange rate would have been much higher than the INR-$.
Regards,
Kalyan.

Again, this is nowhere near enough if you look at the charts in the first post. Why is Indian Rupee down against the dollar last month? Why is EUR and Yuan up last month? The real Indian success story comes from more self reliance at the expense of short term pain for some industries. It is not pleasant anyways. But for sure, everybody will be affected by US slowdown.

I agree with you that dollar needs to come down against INR.

Also,China had been articially keeping the yuan low, not propping it up. That is the reason for the several years of struggle between US and China. However is it appreciating fast more recently. Are we saying the same thing? This is the reason for Chinese dumping cheap stuff on Americans. If you are living in US, you know it is very very hard to find American consumer goods ( from toys to pencils ).

We need to see how it all plays out. At least for now, unlike in US, Indian economists running the show are much smarter. Certainly I am not hoping for hyperinflation in India.

Bye for now.