The RBI's mess.

The RBI's mess.
03-Apr-09
As the RBI is pumping in more credit into the economy to prevent deflation we can easily see India's economy resembles the zombie from George A Romero's The Night of the Living Dead. Only THIS is the real thing. India's economy which has contracted by -3.6% last quarter as per OECD GDP methodologies is being fed with succulent RBI created credit which is zipping at 18% M3 (broad money supply) to keep the zombie among the walking dead. The resultant inflationary bill is arriving at your nearest grocery store soon. :) And don't forget the surcharges coming in the next budget. You'll love the Government for this. Lastest news: RBI's bond issuances have devolved. Nobody wants to buy 10 year GoI treasuries at 7%. Yields will touch 9% (what about my home loan rates!? - sure they are going up). Right now the RBI will go ahead and monetise them, and send the inflation bill to you for immediate payment.
Short the index if you have the stomach to trade, or else stay away from equities. Wockhardt is the next company to go under due to huge forex derivative losses and excessive debt in it balance sheet. Expect a buyout for Wockhardt by Aventis in the next 6 months. Wockhardt is a another walking zombie.