India to Borrow and Spend More in 2010-2011

[RiazHaq]

Just to inform you the NSE and the BSE combined have a market capitalization of over 3.25 trillion which is 27 times bigger than the whole GDP of Pakistan lol let alone the KSE whose market cap is at a baby $30 billion lol hmmm where am i going to invest now lol

You think India's market cap of three times India's GDP is good news? It's a big bubble, and sane investors will stay away from it.

Any market cap larger than the nation's gdp is big red flag, not an incentive to invest more.

 

[sensenreason]

You think India's market cap of three times India's GDP is good news? It's a big bubble, and sane investors will stay away from it.

Any market cap larger than the nation's gdp is big red flag, not an incentive to invest more.

India's market cap is a little more than its GDP...and not 3 times. The reason Indian companies were over valued and will continue to be valued over and above the Chinese etc because Indian private sector is more effcient user of capital.

But if the cap was 3 times of the GDP, it would be a bubble. But with the market range bound for the last 6 months and looks like it will be for another 6 mo's....there wont be any bubble.


India?s global m-cap share exceeds its share in GDP - Money Matters - livemint.com

 

[desiman]

You think India's market cap of three times India's GDP is good news? It's a big bubble, and sane investors will stay away from it.

Any market cap larger than the nation's gdp is big red flag, not an incentive to invest more.

Haha what a loser so your saying that if the market cap is higher than a country GDP then investors should not invest. Really that shows your knowledge, where do you live by the way ?

Ney york stock exchange market cap - 28.5 trillion dollars

United States Of America GDP - 14.5 Trillion dollars


So that means your saying that USA is not good enough to invest in lol what a joker you are man, you made my day i cant stop laughing. This shows what your knowledge is and what your stupid musings are based on. That is what i have been saying all along, your stats are wayyyyyyyy off, you post wrong articles, you play with words, you are nothing but a cheat and im sure thats what you are in real life also. Give up loser, your game is up.

 

[desiman]

You think India's market cap of three times India's GDP is good news? It's a big bubble, and sane investors will stay away from it.

Any market cap larger than the nation's gdp is big red flag, not an incentive to invest more.

and how the heck does BSE or NSE's market cap become India's market cap ?????????????????????? which world are you from ?

 

[RiazHaq]

India's market cap is a little more than its GDP...and not 3 times. The reason Indian companies were over valued and will continue to be valued over and above the Chinese etc because Indian private sector is more effcient user of capital.

But if the cap was 3 times of the GDP, it would be a bubble. But with the market range bound for the last 6 months and looks like it will be for another 6 mo's....there wont be any bubble.


India?s global m-cap share exceeds its share in GDP - Money Matters - livemint.com

The link you referred to makes my point as well:

In short, for the Indian market, the rally of 2003-07 was a one-off event that served to bring market cap more in alignment with the country’s economic strength. With India’s share of market cap already higher than its share of global GDP, future increases in market cap will have to depend on a breakthrough in economic growth.

In other words, further growth in Mumbai share valuations is based on expectation of "breakthrough in economic growth". The Indian market is priced for perfection. It can be tripped up by any bad news along the way.

Pakistan's KSE, on the other hands, reflects all the bad news already with its blue chips very low price-earnings multiples of about half of their Indian counterparts. . It means KSE has much more upside than BSE.

 

[desiman]

The link you referred to makes my point as well:

In short, for the Indian market, the rally of 2003-07 was a one-off event that served to bring market cap more in alignment with the country’s economic strength. With India’s share of market cap already higher than its share of global GDP, future increases in market cap will have to depend on a breakthrough in economic growth.

In other words, further growth in Mumbai share valuations is based on expectation of "breakthrough in economic growth". The Indian market is priced for perfection. It can be tripped up by any bad news along the way.

Pakistan's KSE, on the other hands, reflects all the bad news already with its blue chips very low price-earnings multiples of about half of their Indian counterparts. . It means KSE has much more upside than BSE.

again you make no sense and somehow try to justify why Pakistan is better. The 2008 riots at the KSE clearly show who is more stable. Read your own post once, it really makes no sense at all. Again you have changed the topic without answering even one question.

 

[RiazHaq]

Haha what a loser so your saying that if the market cap is higher than a country GDP then investors should not invest. Really that shows your knowledge, where do you live by the way ?

Ney york stock exchange market cap - 28.5 trillion dollars

United States Of America GDP - 14.5 Trillion dollars


So that means your saying that USA is not good enough to invest in lol what a joker you are man, you made my day i cant stop laughing. This shows what your knowledge is and what your stupid musings are based on. That is what i have been saying all along, your stats are wayyyyyyyy off, you post wrong articles, you play with words, you are nothing but a cheat and im sure thats what you are in real life also. Give up loser, your game is up.

First, let me offer a friendly advice: Please learn to behave yourself. Stop the name calling. Deal with the facts and arguments in a civilized manner.

Next, let me tell you that your data is wrong. The US market cap exceeded its GDP briefly during the bubble years around 2000 when the bubble popped. The market has not returned to those heights since.

As of today, the Total Market Index is at $ 12,058.7 billion, which is about 83.4% of the last reported GDP.

Where Are We with Market Valuations?

 

[Bombay]

It can be tripped up by any bad news along the way.

Do some research before writing. This is what happened in BSE after 26/11
Sensex snubs terror threat, ends up 66pts
India Business News: November 2008

Pakistan's KSE, on the other hands, reflects all the bad news already with its blue chips very low price-earnings multiples of about half of their Indian counterparts. . It means KSE has much more upside than BSE.

Ok Ok. You win we lose. All Indians are just fools to be living in Alice's wonderland thinking that their country is better which is consistently growing at 7-8-9%. No. It is Pakistan which performs better economically, though it gets aid from IMF, World Bank, US, UK, Saudi Arabia, Denmark, China, Japan, etc.

Now here is something you should concentrate upon...

Growth rates have been generally high during military regimes. In your opinion, is it due to better economic strategies during military regimes or because of external factors?

There is a major misconception that military rule has resulted in economic stability as compared to democratic governments. For example, the “economic miracle” of General Ayub Khan lasted only from 1961 to 1965 after which the economic situation sharply deteriorated. General Yahya Khan’s tenure resulted in the complete bankruptcy of Pakistan while General Musharraf’s regime witnessed economic growth only from 2003 to 2007. At the same time, one must understand the context of this economic “growth” witnessed during these military regimes. All of them involved a major liquidity injection from western powers that had a strategic interest in aiding these governments. General Ayub Khan received a generous amount of aid from the US as he was perceived as a crucial Cold War ally. General Zia-ul-Haq was even luckier as the Soviet Union invaded Afghanistan, which transformed Pakistan’s position as a strategic asset for the West in its fight against communism. The same is true for General Musharraf’s regime which received tons of foreign aid after it declared its support to the US-led “war on terror”.

Therefore we see that this economic growth was a result of external factors rather than any foresighted policies on the part of the military regimes. What we can say, however, is that the military regimes completely failed to implement any structural reforms in the system and almost always left the corridors of power with a high budget deficit and a low economic growth, as was witnessed recently with General Musharraf who left his office with the economy in a complete mess. In fact, I blame the military governments more than the democratic regimes as representative governments are unable to undertake unpopular decisions due to political constraints whereas military regimes do not have to take into account public perception in formulating their policies. The failure to institute structural reforms despite complete control over the state apparatus demonstrates how military governments did not have the will to implement change.

What is your economic forecast for the next fiscal year?

I do not see any economic turnaround in the near future. Inflation will not go down as considerable liquidity has been injected into the economy as a result of the provincial government’s decision to borrow from the banks in order to pay subsidies on wheat. The ever increasing budget deficit will keep on increasing as there seems to be no consensus on how to increase our tax revenue. As stated earlier, the constant clash between major political parties will also make it highly unlikely for the current government to push through unpopular but necessary fiscal measures.

Other avenues for revenue generation also seem limited. It is difficult to attract foreign investment considering the security situation in the country. Lack of foreign investment will remain a hindrance for economic growth which means that unemployment will only increase. I feel that the government would desperately search for a bailout package from governments in the West and may eventually end up borrowing another loan from the IMF.

Interview of a LUMS professor.


Keep musing.........

 

[Justin Joseph]

It is ridiculous to compare a poor, backward, third world country like India with the US where people have a much higher std of living and a basic safety net.

India is still very primitive with its largest population of poor, hungry and illiterate people. India is a place where two-thirds of the population still defecates in the open.

1. You are talking like a typical looser, i have proved u wrong and tear down your borrowing and spend theory perfectly, so u came down to cheap rant.

2. This shows ur frustration and u have not any answer.

And for ur kind information from India is a developing country not 3rd world but u have to remove ur cheap chinese sun glasses to see it.

All over the world from economists to president of US, France, Russia calls India a developing and well performing economy. And u thinks ur self superior to all. Go and get a life.

 

[chinapakistan]

And for ur kind information from India is a developing country not 3rd world but u have to remove ur cheap chinese sun glasses to see it.

Can indian industry even produce cheap sun glasses?

 

[chinapakistan]

All over the world from economists to president of US, France, Russia calls India a developing and well performing economy. And u thinks ur self superior to all. Go and get a life.

And all the countries you mentioned called china the next superpower. Will you believe it?Even chinese themself dont believe the crap saying from west.

 

[Bombay]

Can indian industry even produce cheap sun glasses?

No we cannot produce cheap sun glasses. Producing "cheap" things is a right of Chinese industry.

 

[chinapakistan]

No we cannot produce cheap sun glasses. Producing "cheap" things is a right of Chinese industry.

Yes, you are right, and produce "nothing" is a right of indian industry.

 

[desiman]

First, let me offer a friendly advice: Please learn to behave yourself. Stop the name calling. Deal with the facts and arguments in a civilized manner.

Next, let me tell you that your data is wrong. The US market cap exceeded its GDP briefly during the bubble years around 2000 when the bubble popped. The market has not returned to those heights since.

As of today, the Total Market Index is at $ 12,058.7 billion, which is about 83.4% of the last reported GDP.

Where Are We with Market Valuations?

Behave myself with a person like you. You’re the reason why I have to use words that I never like to use. Your obsession with India coupled with posting articles that hurt the emotions of every Indian here are reason enough for me to call you whatever I want. Your totally wrong statistics which are only posted to satisfy your small ego and somehow prove that Pakistan is better than India are disgusting and that is not something I will sit and let happen. Go and learn proper manners and how to respect someone’s country first before you teach me manners. My post on other thread’s are testament to the fact that I do not like doing all this but your crap posting has forced to drop down a level. You not only disgust me as a person but also worry me that I hope there arnt other people like you in this world. You argument will be dealt in a civilized manner when you learn how to respect someone else’s feelings also.

Back to the topic, no your stats are wrong as well again. The market cap of the New York exchange has been higher than the USA GDP for a long time. And I don’t know what you are trying to say but market cap of a stock exchange vs the GDP of a nation is not a economic or investment criteria by any standards. You are again quote older articles, an article that was written in 2000 and is not relevant by any standards anymore. The article does not even talk about what you are trying to say. I hope you know country’s do not have market caps. Buddy there are other people here also that know economics inside out. My minor was economics as Berkeley from where I did my masters so don’t go around trying to fool everyone here with your fancy language.

 

[desiman]

Yes, you are right, and produce "nothing" is a right of indian industry.

India might not be able to produce anything but China can surely produce some good trollers. Contribute properly or don’t say anything at all.