tag:blogger.com,1999:blog-19740856.post9163375828798622454..comments2024-03-28T23:30:16.420-07:00Comments on India's housing bubble: RBI hikes interest rates to tame inflationUnknownnoreply@blogger.comBlogger61125tag:blogger.com,1999:blog-19740856.post-29575585495964915792010-09-22T06:07:30.841-07:002010-09-22T06:07:30.841-07:00The Whole World is a Bubble!<a href="http://www.taipanpublishinggroup.com/tpg/taipan-daily/taipan-daily-092210.html" rel="nofollow"> The Whole World is a Bubble! </a>Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-70852842266235465242010-09-22T05:26:51.327-07:002010-09-22T05:26:51.327-07:00Article Link
The surge in equity prices over the ...<a href="http://www.livemint.com/2010/09/21202520/Is-India-overheating.html" rel="nofollow">Article Link</a><br /><br />The surge in equity prices over the past few weeks has taken the major Indian stock indices close to their historic highs. Real estate prices have also been soaring. Inflation seems to have peaked, but is still very high by international standards. Is India overheating?<br /><br />Judging whether stocks and real estate are in bubble territory is always a tough call, but a recent analysis published in this newspaper on Monday shows that the percentage of market capitalization to gross domestic product (GDP) is down from 160% in January 2008 to an estimated 104% right now, based on an assumption of 8.5% economic growth in this fiscal year. In other words, the underlying economy has grown faster than the market value of listed equities in these past 30 months or so. Similarly, real estate prices seem to be at historic highs, but the ratio of housing prices to average incomes is lower today than it was two or three years ago.<br /><br />The main macroeconomic risks right now are elsewhere—the twin internal and external deficits. India ended 2006-07 with a current account deficit of 1.1% of GDP. This year the external deficit could be anything between 2.5% and 3% of GDP, one of the highest levels since the crisis of 1991. Government profligacy has eaten into national savings and led to a wider current account deficit (or the gap between domestic investment and domestic savings), which makes India heavily dependent on capital inflows at a time when the world economy continues to be fragile.<br /><br />The major economic risks are not from an asset bubble, but from the growing fiscal and current account deficits.shaileshhttps://www.blogger.com/profile/14407031960831830463noreply@blogger.comtag:blogger.com,1999:blog-19740856.post-62462951802678599572010-09-22T02:19:08.132-07:002010-09-22T02:19:08.132-07:00we are back to our fight for greeds and needs (rea...<i> we are back to our fight for greeds and needs (real or perceived) .. and aspirations and ideas (dogmas, prejudices)… </i><br /><br />Above statement from my previous post answers your question in a subtle way.<br /><br />Coming to the translation... i feel engineers can do it better.. so i leave it to youLaaloo Prasad yadavnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-66452631264033195752010-09-22T01:31:01.846-07:002010-09-22T01:31:01.846-07:00And now the CWG village apts. are going to be sold...<i>And now the CWG village apts. are going to be sold at prices starting from 2.75 crores. Any takers?</i><br /><br />Dude, I wouldn't touch those CWG apartments with a flagpole if I were you, specially after the footbridge collapse yesterday. God knows who built these apartments and how much Kalmadi made after switching cement for sand.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-23907494426051704332010-09-22T01:27:27.221-07:002010-09-22T01:27:27.221-07:00Laloo, I'm not a consultant, I'm an engine...Laloo, I'm not a consultant, I'm an engineer.<br /><br />Everything I say or do has some practical application in focus.<br /><br />Had this not been the case, I'd have been an economist :-)<br /><br />Now, the question still stands. Why do you want real estate?<br /><br />I'm not looking for philosophy here. I'm simply looking for a reason.<br /><br />Like "I want to own a flat because I want to become rich."<br /><br />I'm not making a moral judgment here - like "Having a desire is wrong, and you are a jerk for having desires."<br /><br />If we analyze all the causes of owning real estate, and we find that there are better ways of objectively attaining those goals, then that is what I want to do.<br /><br />jnAtumicchAmyahantava karaNAni krItasadanArjanArthasya vivAdam na icchami vairAgyavishayasya<br /><br />Perhaps you can translate, Laloo? If not, I'll do it in a following post.DhImAnnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-32609812445379103382010-09-21T23:07:39.354-07:002010-09-21T23:07:39.354-07:00Hi Dhiman
U must be a consultant. If not, u bette...Hi Dhiman<br />U must be a consultant. If not, u better change ur career.. I assure you.. u will be one of top in that field..<br />Coming to your Baba Dhiman Questioner,<br />All is Well.. When we go to a Mahatma, he says all these things.. and at that moment it looks so logical.. we all start thinking like perfect YOGI. But what happens when we come back to home..??<br />There is saying.. “ smasana Vairagyam” or “Samshana Vairagyam” <br /> (Viragi, has two meanings.. <br />no raagam ( no emotion) one meaning<br />visesha raagam ( specific emotion only, in this case.. emotion to GOD alone)<br />You get this kind of feeling when we are at ‘dahana samskara’.. the moment we come back home and wash ur feet.. all the knowledge flies away… we are back to our fight for greeds and needs .. and aspirations and ideas…<br />If everyone can hold that IDEA even after coming back to our regular life, this world will be heaven. <br /><br />So dear, don’t tell me stories.. lets get to point.. <br />And discuss about Indian economy and Real estate values <br /><br />(One who is capable is busy with execution.. one who is not capable.. discusses the matter)<br />If you want.. I can also explain ..”prasuti Vairagyam”<br /><br /><br />Hope, you followed me...Laaloo Prasad yadavnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-68307340449346771382010-09-21T22:41:23.270-07:002010-09-21T22:41:23.270-07:00Hello folks, today I want to engage in a little se...Hello folks, today I want to engage in a little self examination, please play along for a bit to humor me.<br /><br />We all know that in theory, practice is supposed to agree with theory, but in practice, theory doesn't always agree with practice. Right? (That's a Yogi Berra-ism BTW).<br /><br />So all theories and all practice aside, please answer me -<br /><br />Why is it that you are clamoring for real estate thus?<br /><br />What happens if you don't own your own home?<br /><br />You can always rent or you can move to where you can afford a home. <br /><br />If you have money lying around, you could invest it in the BSE - it went from 9k to about 21k in less than a year. Or any number of investment vehicles.<br /><br />If you don't have money, the choice is simple - don't buy, just rent.<br /><br />Why is everybody so desperate to own a flat as if your life depended on it?<br /><br />What would go wrong if you never owned any real estate all your life?<br /><br />After all, you aren't going to take it with you when you finally go, and your wife and kids would appreciate cash more than real estate as inheritance.<br /><br />I mean, would it be easier for your wife to pay for the kids school/college/wedding with money you left her or by selling the house you left her, finding another place to live, moving and disrupting everything at the precise time that you aren't there to help?<br /><br />Ignore economics, ignore politics - just examine your own self for a second. Why do you thirst so badly for a flat?<br /><br />I ask these questions sincerely; i.e., not in sarcasm or rhetorically - so please answer honestly.DhImAnnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-40787079709415673292010-09-21T22:22:08.164-07:002010-09-21T22:22:08.164-07:00Look Desi Batman, I agree with you but all in theo...Look Desi Batman, I agree with you but all in theory. Recently again king of fool Pranob Mukhrajee said Indian has only 7.5 laks people who earn more than 5 laks p.a.. now can you pls tell me in that case even you combine just buy/sell transaction over the past one month in Delhi/Mumbai/Chennai/Pune etc max. two month, you will get minimum double of 7.5 lakh people, now all this transactions I am sure is above 50 lakhs now is to so easy to believe that new projects are sold over night costing crores in distinct suburbs of Mumbai even in dahisar, miraroad and we are talking about 7.5 lakhs tax payers in 120 crore population<br />Also now I know that I am poorer by 40 laksh in last three months as my money in bank account gave me useless interest which is of no use. If you are so sure about your analysis just tell me where is the silver line?Desi Bacheranoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-47932055782937806502010-09-21T11:13:39.097-07:002010-09-21T11:13:39.097-07:00@ Anonymous 10:18 AM
Looks like the downward pric...<i> @ Anonymous 10:18 AM<br /><br />Looks like the downward price mentioned in craigs list was just to attract prospective customers. Looks like this is a desperate act from realestate agents, will not work. The moment you call them they say sorry and jack back the price. </i><br /><br />This tactic is known as Bait and Switch. It's an old trick that still works. This is trick is highly used for car sales in USA.Desi Batmanhttps://www.blogger.com/profile/09682126344769532066noreply@blogger.comtag:blogger.com,1999:blog-19740856.post-2658491532320732442010-09-21T11:10:09.876-07:002010-09-21T11:10:09.876-07:00Anonymous 10:11 AM
And now the CWG village apts. ...<i> Anonymous 10:11 AM<br /><br />And now the CWG village apts. are going to be sold at prices starting from 2.75 crores. Any takers? </i><br /><br />India has huge population and has tons of rich people, Rs.2.75 crores is average price for RE for them. India has 1.2 billion people, even if we consider lowest figure of 1% that are rich people, the rich community is 12 million strong! Many have not even entered the market to buy the houses. But on other side poor people and young generation are screwed.Desi Batmanhttps://www.blogger.com/profile/09682126344769532066noreply@blogger.comtag:blogger.com,1999:blog-19740856.post-67880686008643162242010-09-21T10:59:07.025-07:002010-09-21T10:59:07.025-07:00Be ready to pay high price for your pao-bhaji and/...Be ready to pay high price for your pao-bhaji and/or with inferior quality pao-bhaji. <br /><br />Now for explanation: With this explanation you should realize that how RE price will drives up cost of other commodities and/or create more poverty.<br /><br />* Cost price = Labor price + material: Anything you purchase cost price consists of Labor price and material price. This is true in case of RE also. Let's say cost of RE is 75 lacs.<br />* Selling price = Cost + Profit: Now 75 lacs with 75 lacs profit. Selling price is 1.5 crores<br />* Buying price = Selling price: Selling price of RE is 1.5 crores, so somebody buys for 1.5 crores.<br />* Buying price = Labor price: To pay 1.5 crores someone has to earn by his labor (any means) accordingly and any increase in RE prices to afford his labor has to increase in sync. Now the buyer will not always be in RE business, this person can earn from any kind of labor let's say by making Pao-Bhaji. <br /><br />Therefore now going back to start: Cost price = Labor price + material, the cost price of Pao-Bhaji (or any other commodity HAS to increase). This will push increase in selling and buying price of Pao-Bhaji. <br /><br />Now to keep Pao-Bhaji buying price in control what needs to happen? Bring down cost price and/or profit. But you don't want profit to plummet, so reduce cost price. For cost price to decrease one has to find cheap labor and/or inferior quality/cheap material. To get Cheap labor, you start sqeezing labor class with every penny, pay less for increased work, basically make poorer more poor. Otherside: Your pao-bhaji will cost more or your quality of pao-bhaji is no more what you paid for. <br /><br />Where does this stop? As long as the bottom layer is ready to compromise, ready to be exploited, ready to live more and more poor quality, this RE hikes will continue. We all know by history how all this will end.Desi Batmanhttps://www.blogger.com/profile/09682126344769532066noreply@blogger.comtag:blogger.com,1999:blog-19740856.post-83059238646243680702010-09-21T10:18:51.789-07:002010-09-21T10:18:51.789-07:00Looks like the downward price mentioned in craigs ...Looks like the downward price mentioned in craigs list was just to attract prospective customers. Looks like this is a desperate act from realestate agents, will not work. The moment you call them they say sorry and jack back the price.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-88121947524468991362010-09-21T10:11:33.365-07:002010-09-21T10:11:33.365-07:00And now the CWG village apts. are going to be sold...And now the CWG village apts. are going to be sold at prices starting from 2.75 crores. Any takers?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-74789993239857959882010-09-21T10:08:53.746-07:002010-09-21T10:08:53.746-07:00Where the hell is Bindas Bhai. Vik can you please ...Where the hell is Bindas Bhai. Vik can you please request BB to post. A lot of people including Shailesh is loosing focus. We need the old gang to contribute. Vulture we are really missing you.Preetinoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-85876567735193900912010-09-21T06:42:25.834-07:002010-09-21T06:42:25.834-07:00@ Bachera Indian said...
Finally I have called a d...<i> @ Bachera Indian said...<br />Finally I have called a day and paid the token amount for the same flat in Malad/Goregaon junction for 1.40 crore, as I am observing this blog for three years and price have quadrupled after that, but not declined a pence.</i><br /><br />I am sorry to hear that you take this blog as future prediction, No it is not meant for that. This is for creating awareness and put some economic sense into non-sense.<br /><br />What is your analysis for price to quadrupled in past three years? What fundamentals have changed in India to support this RE price hikes?<br /><br /><br /><i>My sincere advice to all the reader go and jump the bandwagon ultimately all this analyses, theories and research in of zero help as we have a fool people in RBI, Govt and ministry</i><br /><br />Right and Wrong.<br />Right - we have a fool people in RBI, Govt and ministry. And as DhImAn said earlier - do you expect this to be forever?<br /><br />Wrong - People are not fool on this blog, they are trying to understand the fundamentals, they are here to understand what makes crores of Rs. available for RE. They are here to address issue what most idiots don't understand.<br /><br />You may be few of a stinking rich guy to afford RE of 1.4 crores, many unfortunately are not so rich and have no whatsoever means to make that money. So think where are your future buyers in 1.4+ crores range?Desi Batmanhttps://www.blogger.com/profile/09682126344769532066noreply@blogger.comtag:blogger.com,1999:blog-19740856.post-82524174988023067672010-09-21T05:48:51.282-07:002010-09-21T05:48:51.282-07:00There are many forums one of them is http://www.r2...There are many forums one of them is http://www.r2iclubforums.com/forums/showthread.php/20858-Mantri-pinnacle-Bannergatta-road<br /><br />Please search to get what info you need about Bangalore real estate.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-56753677772302403072010-09-21T04:14:50.711-07:002010-09-21T04:14:50.711-07:00http://money.cnn.com/2010/09/15/real_estate/califo...http://money.cnn.com/2010/09/15/real_estate/california_home_price_rebound/index.htmAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-32372604397412920162010-09-21T03:45:09.508-07:002010-09-21T03:45:09.508-07:00Finally I have called a day and paid the token amo...Finally I have called a day and paid the token amount for the same flat in Malad/Goregaon junction for 1.40 crore, as I am observing this blog for three years and price have quadrupled after that, but not declined a pence.<br /><br />My sincere advice to all the reader go and jump the bandwagon ultimately all this analyses, theories and research in of zero help as we have a fool people in RBI, Govt and ministry<br /><br />Bachera IndianBachera Indiannoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-52204739169528868112010-09-21T03:39:56.959-07:002010-09-21T03:39:56.959-07:00As someone living in Bangalore, I can vouch for th...As someone living in Bangalore, I can vouch for the earlier post. I have seen several properties drop their prices recently. Also, I have seen many apartments on the market for more than a year now and one established real estate agent that helped me find a rental has now gone out of business.<br /><br />Go figure!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-55215976139121084602010-09-20T23:30:10.854-07:002010-09-20T23:30:10.854-07:00http://economictimes.indiatimes.com/opinion/commen...http://economictimes.indiatimes.com/opinion/comments--analysis/Get-the-government-out-of-land-deals/articleshow/6596604.cms <br /><br />Who profits from big infrastructure projects? The infrastructure developers who are closest to the developers !<br /><br />That is the case every where in India.<br /><br />And this is affecting the infrastructure development in India.<br /><br />~ sAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-90938686064143033642010-09-20T23:07:09.944-07:002010-09-20T23:07:09.944-07:00can you point me to the prices in bangalore. Mant...can you point me to the prices in bangalore. Mantri has launched their new project in bannerghaata road for 4900. deep inside harlur road Purva is pricing 3300. where is the drop ?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-86918065549593202222010-09-20T15:11:05.817-07:002010-09-20T15:11:05.817-07:00Ignoring asset price inflation
The recent action ...<a href="http://www.thehindubusinessline.com/2010/09/21/stories/2010092150440900.htm" rel="nofollow"> Ignoring asset price inflation</a><br /><br />The recent action taken by the Reserve Bank of India to hike the repo and reverse repo rates has been interpreted as a shift in focus to inflation control resulting from a combination of comfortable growth figures and disconcerting increases in the prices of goods, especially food articles.<br /><br />What is surprising is that little concern is being expressed and action being taken with regard to the sharp increase in asset prices, especially equity prices. India's stock market recovery over the last year and a half is a bit too remarkable for comfort (Charts 1 and 2).<br /><br />From its March 9, 2009 level of 8,160, the Sensex at closing soared to touch 19,594 on September 17, 2010. This is not far short of the 20,870 peak the index closed at on September 1, 2008.<br /><br />This steep increase the index has registered in recent months occurs when the after-effects of the global crisis are still being felt in various parts of the world where the recovery has been halting and unemployment still rampant.<br /><br />This implies that the current bull-run can be explained only as being the result of a speculative surge that recreates the very conditions that led to the collapse of the Sensex from its close to 21,000 peak of around a year ago.shaileshhttps://www.blogger.com/profile/14407031960831830463noreply@blogger.comtag:blogger.com,1999:blog-19740856.post-32584651789351181782010-09-20T13:59:41.917-07:002010-09-20T13:59:41.917-07:00Wow, Bangalore real estate prices crashed by 30%. ...Wow, Bangalore real estate prices crashed by 30%. I checked couple of properties in craigslist and notice the price difference from last year. This is a very good sign.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-654538535017969202010-09-20T11:54:35.438-07:002010-09-20T11:54:35.438-07:00Dude, this is the most asinine statement I have ev...<i>Dude, this is the most asinine statement I have ever heard. You are indeed the master of extrapolation. Grow a beard, hold a doomsday sign and walk up and down on chowpati. That way, at least someone might buy you some pao-bhaji.</i><br /><br />No, what is asinine is for you or me to accept pieces of colorful paper as something that have value.<br /><br />Scratch that. What is asinine is for you or me to save up these colorful pieces of paper to buy things in the future.<br /><br />In other words, it is stupid to save in a money that loses value. Gresham's law and all.<br /><br />So what happens when people dump paper en masse for tangible property such as real estate or gold?<br /><br />You see a dramatic rise in "price" of these real things leading to loss of faith in the money.<br /><br />Nothing new or surprising about it. It has happened several times in history already.<br /><br />And as Samix says, hyperinflation is not equal to apocalypse.DhImAnnoreply@blogger.comtag:blogger.com,1999:blog-19740856.post-62261154780883040002010-09-20T11:41:27.033-07:002010-09-20T11:41:27.033-07:00This comment has been removed by the author.Anonymousnoreply@blogger.com