Bull Zone

#74
Latest Inflation figures 8.1 are a cause for concern. so it is looking more like India is moving towards hyper inflation of > 10% . RBI gov himself believes the inflation numbers may be under estimated. the difference between inflation and hyper inflation is simply that hyper inflation is not controllable. the actions by the FM and the inflation numbers indicate that things are not in control when it comes to inflation. the problem with inflation when it goes to levels like 10% is , people will start taking correcting actions by hoarding, which increases the problems even more. instead of buying for the next 1 month , if people start buying for the next 3 months , prices will go further up.

it remains to be seen if we are going to be below 10%, which is the worst case. Luckily we do not have the same problems are other countries experiencing hyper inflation like iceland, zimbabwe.

If you go downhill, you go slow , otherwise you fall. When they chase this so called 8 % growth rate, that is what happens. In any case, India is not the size of Zimbabwe or Iceland, it would take few years to get to a hyper inflationary environment ( published figure of > 25%) , if it ever happens.
There is no doubt that the people who run the central banks are smart ( and bankers in some countries are smarter than others) , but whole system is designed and manipulated as needed to benefit the bankers and institutional investors at the highest level.
 
Last edited: