India to Borrow and Spend More in 2010-2011

[thebrownguy]

I have serious doubts about your ability to read and understand the basic stuff about investing...I have given you plenty of links to reliable data and credible sources but you continue to flunk badly. It's too high a level for you.

Maybe you can learn something by starting with the ABC of investing in stocks...I bet your local community college in Canada offers such a course.

Start with the basics of valuation criteria, like discounted cash flows and NPVs, PE ratios, PEG ratios, Market cap to GDP ratios, etc. It'll do you a lot of good.

Consider doing that.

But as far as you are concerned, you do not need to sharpen your skills. Your ability to blatantly lie, fabricate figures and come up with stupid conclusions, based on some articles with no credibility makes you perfect for your choice of career. Rupee news is very impressed and they are considering to pay 4 Rs (The devaluated Pakistani Rupee) for each of your musings, instead 1 Rupee they were paying you.
Come on buddy , keep the articles coming, make your bucks!!

 

[desiman]

hehe..he will probably start a new topic saying X amount indian vehicles dont have a spare tyre!!

im sure thats coming soon, another amusing musing lol

 

[desiman]

But as far as you are concerned, you do not need to sharpen your skills. Your ability to blatantly lie, fabricate figures and come up with stupid conclusions, based on some articles with no credibility makes you perfect for your choice of career. Rupee new is very impressed and they are considering to pay 4 Rs (The devaluated Pakistani Rupee) for each of your musings, instead 1 Rupee they were paying you.
Come on buddy , keep the articles coming, make your bucks!!

hey hey hey he lives in the US, they probably pay him in dollars there

 

[riju78]

But as far as you are concerned, you do not need to sharpen your skills. Your ability to blatantly lie, fabricate figures and come up with stupid conclusions, based on some articles with no credibility makes you perfect for your choice of career. Rupee new is very impressed and they are considering to pay 4 Rs (The devaluated Pakistani Rupee) for each of your musings, instead 1 Rupee they were paying you.
Come on buddy , keep the articles coming, make your bucks!!

yeah he left the super prosperous pakistan a long time ago and is in silicon valley!! so he gets paid in dollars!!!!!!!!!!!!!!!!

http://pakistan.wikia.com/wiki/Riaz_Haq

Mr. Riaz Haq (ریاض ح&#1602 is a high-tech executive, investor, business consultant and entrepreneur in Silicon Valley, CA. His credits include Intel 80386 CPU design that earned him a Person of the Year Award and two Silicon Valley startups he founded. Mr. Haq is an NED Engineering University alumnus from EE class of 1974 and he earned an MSEE from New Jersey Institute of Technology in 1982. Mr.Haq is the founder and President of PakAlumni Worldwide. For over 20 years Mr Haq has been engaged in complex high-tech product marketing, online consumer marketing, Web 2.0 technologies, development and engineering/operations with strong knowledge in software, semiconductors,microprocessors, networking and personal computer technologies at large and small companies including startups. Mr. Haq is a charter member of TIE Silicon Valley and served as Chairman of NEDians Convention 2007 in Silicon Valley.
As President of NED Alumni Association of Silicon Valley, Mr. Haq along with several prominent NED Alumni in Silicon Valley, organized, financed, marketed to NEDians and put on a major annual convention in 2007 in Silicon Valley with record attendance and extremely positive attendee survey results. As Product Line Manager of Intel’s mobile software, Mr. Haq focused on key parameters such as improvements in connectivity, battery life extension, security, offline/online computing, synchronization with PC notebooks including Centrino campaign, context-aware computing, personal entertainment, location-based services etc. Mr. Haq was recognized as Person of the Year by PC Magazine during his first stint at Intel. Mr. Haq founded and managed Cautella through seed funding, tech development and product planning to address Fixed-Mobile Convergence market for data and voice. Mr. Haq has managed skilled teams and delivered complex and time-critical projects for Intel Corp, Cautella, DynArray and Silicon Image. Mr. Haq successfully drove products and product lines from concept and business strategy and roadmaps through development, launch, deployments, customer engagements and upgrade cycles garnering significant revenue and profitability. He founded and managed DynArray, an enterprise software company focused on linking legacy to the Web and grew it from zero to $10m within 18 months delivering to major customers including IBM, Allianz, Sandvik, SCIF and others. He led Intel’s mobile software product line with significant new developments including location-based application support, Web Services APIs, mobile Web 2.0 mash-ups (with Web services APIs from Amazon, Google and Yahoo), context-aware computing etc. winning major customers including SAP, IBM, IBM, Accela and others. Mr. Haq blogs at Haq's musings and South Asia Investor Review.

 

[desiman]

yeah he left the super prosperous pakistan a long time ago and is in silicon valley!! so he gets paid in dollars!!!!!!!!!!!!!!!!

Riaz Haq - Pakistan

Mr. Riaz Haq (ریاض ح&#1602 is a high-tech executive, investor, business consultant and entrepreneur in Silicon Valley, CA. His credits include Intel 80386 CPU design that earned him a Person of the Year Award and two Silicon Valley startups he founded. Mr. Haq is an NED Engineering University alumnus from EE class of 1974 and he earned an MSEE from New Jersey Institute of Technology in 1982. Mr.Haq is the founder and President of PakAlumni Worldwide. For over 20 years Mr Haq has been engaged in complex high-tech product marketing, online consumer marketing, Web 2.0 technologies, development and engineering/operations with strong knowledge in software, semiconductors,microprocessors, networking and personal computer technologies at large and small companies including startups. Mr. Haq is a charter member of TIE Silicon Valley and served as Chairman of NEDians Convention 2007 in Silicon Valley.
As President of NED Alumni Association of Silicon Valley, Mr. Haq along with several prominent NED Alumni in Silicon Valley, organized, financed, marketed to NEDians and put on a major annual convention in 2007 in Silicon Valley with record attendance and extremely positive attendee survey results. As Product Line Manager of Intel’s mobile software, Mr. Haq focused on key parameters such as improvements in connectivity, battery life extension, security, offline/online computing, synchronization with PC notebooks including Centrino campaign, context-aware computing, personal entertainment, location-based services etc. Mr. Haq was recognized as Person of the Year by PC Magazine during his first stint at Intel. Mr. Haq founded and managed Cautella through seed funding, tech development and product planning to address Fixed-Mobile Convergence market for data and voice. Mr. Haq has managed skilled teams and delivered complex and time-critical projects for Intel Corp, Cautella, DynArray and Silicon Image. Mr. Haq successfully drove products and product lines from concept and business strategy and roadmaps through development, launch, deployments, customer engagements and upgrade cycles garnering significant revenue and profitability. He founded and managed DynArray, an enterprise software company focused on linking legacy to the Web and grew it from zero to $10m within 18 months delivering to major customers including IBM, Allianz, Sandvik, SCIF and others. He led Intel’s mobile software product line with significant new developments including location-based application support, Web Services APIs, mobile Web 2.0 mash-ups (with Web services APIs from Amazon, Google and Yahoo), context-aware computing etc. winning major customers including SAP, IBM, IBM, Accela and others. Mr. Haq blogs at Haq's musings and South Asia Investor Review.

Again as it is editable content, i dont really believe it fully, i was going to edit it myself and add some things But one must wonder if the man has so much experience why does he have to indulge in petite article posting to keep himself busy. A man with this kind of experience can just contribute so much more if he starts talking constructively. Its truly sad.

 

[desiman]

This is for Mr. Riaz Haq from every Indian –

I know isn’t India just amazing. Jai Hind.

 

[Jade]

Mr. Riaz Haq, you haven’t answered logically to Karan’s post.

Legendary investor Warren Buffett calls total market cap to gdp ratio as the "best single measure" for investors to make decisions on its future prospects.

First of all Warren Buffett was referring to US economy. The ratio could not be true/be applied to Indian economy, which is the growth phase.

I think it's ridiculous to compare India's economy with the kind of individual high-tech western companies that command premium with all their intellectual property advantages.

Second, Karan was only using a company as a model to explain a situation. Nothing wrong I feel. After all, economics is all about modeling.

India's economy is not a high-tech economy, and the small part of it that is high-tech is essentially code coolie work which is the result of cost arbitrage. Most of what is called IT in India is still low-level code work or call centers. .

Third, there is nothing to ashamed of low-level code work or call centers. Trade happens when there is comparative advantage between countries. Trade is important for growth

If the stock market does represent the economy as a whole, then it can not be much bigger than, nor grow much faster than the overall economy, unless it is heavily undervalued to begin with. .

Stock market does not even represent all stocks exchanged; forget it representing the whole economy. Stock markets usually grow much faster than the overall economy because they represent only a small part of economy and sector such as agriculture are not properly represented in stock markets. This has nothing to do with undervaluation

 

[karan.1970]

Legendary investor Warren Buffett calls total market cap to gdp ratio as the "best single measure" for investors to make decisions on its future prospects.

I think it's ridiculous to compare India's economy with the kind of individual high-tech western companies that command premium with all their intellectual property advantages. India's economy is not a high-tech economy, and the small part of it that is high-tech is essentially code coolie work which is the result of cost arbitrage. Most of what is called IT in India is still low-level code work or call centers.

If the stock market does represent the economy as a whole, then it can not be much bigger than, nor grow much faster than the overall economy, unless it is heavily undervalued to begin with.

These are some of the basics of stock market investing anywhere in the world. Those who ignore these rules do so at their own peril.


Where Are We with Market Valuations?

Good try old man.. But you are exactly proving my point. The example/illustration/buffetology is saying what I was.. GDP/Revenue and Market cap are surely linked But its not only GDP/Revenue but also growth in GDP/Revenue that drives the MCAP. Understand that MCAP depends on the value that the market puts on your stocks. If the market has confidence on your growth story, thats the time you will find MCAP in multiples of GDP/Revenue.

Say a company/country is growing at 9-10%. It means its revenue/GDP will double in 7-8 years. So if you buy into that even at 2x, you will be at 1x in 7-8 years time. And if the growth expectations are long term as in case of India, in 15 years, you will be at 0.5 x averaging out to 1x. Hence the world is willing to pay a premium in terms of revenue/gdp multiples for growth economies. Why this does not hold well in a US is because of benign low growth rate of 2-2.5% which changes the time frame of 7-15 years to 35-70 years. Hence the MCap/GDP ratio there gravitates towards a little less than 1.

Now if you see Pakistan's economy, the growth rates are of the same order i.e. 2-2.5% at this time due to the last couple of years' mess. And the future is also uncertain till the time this terrorist menance is sorted out. Also, the maturity of the capital markets in PAkistan is low. This is well reflected in the dismal Mcap to GDP ratio of Pakistan..

So while you talk about basics, try and include the complete set and not exclude items like growth etc to suite your own convinience...

BTW not a very good try with the code coolie example. The contribution of services exports is a small percentage in the over all GDP and MCap of India.

 

[desiman]

Hum logon ko samajh sako to samjho dilbar jaani
Jitna bhi tum samjhoge utni hogi hairaani

Apni chhatri tumko dedein kabhi jo barse paani
Kabhi naye packet mein bechein tumko cheez puraani

Phir bhi dil hai hindusatni
Phir bhi dil hai hindustani

Thode anari hain thode khiladi
Ruk rukke chalti hai apni gaadi
Humein pyaar chahiye
Aur paise bhi
Hum aise bhi hain
Hum hain vaise bhi

Hum logon ko samajh sako to samjho dilbar jaani
Ulti seedhi jaisi bhi hai apni yehi kahaani

Thodi hummein khushiyaan bhi hain
Thodi hai nadaani
Thodi hum mein sachchaai hai
Thodi beimaani
Phir bhi dil hai hindusatni
Phir bhi dil hai hindustani

Aankhon mein kuchh aansoo hain kuchh sapne hain
Aansoo aur sapne donon hi apne hain
Dil dukha hai lekin toota to nahin hai
Umeed ka daaman chooka to nahin hai
Hum logon ko samajh sako to samjho dilbar jaani
Thodi majboori hai lekin thodi hai manmaani
Thodi tu tu main main hai aur thodi kheecha taani
Hum mein kaafi baatein hain jo lagti hain deewani
Phir bhi dil hai hindusatni
Dil hai hindusatni


There might be many worlds in the universe but there will only be one India, JAI HIND

 

[riju78]

Again as it is editable content, i dont really believe it fully, i was going to edit it myself and add some things But one must wonder if the man has so much experience why does he have to indulge in petite article posting to keep himself busy. A man with this kind of experience can just contribute so much more if he starts talking constructively. Its truly sad.

thats EXACTLY what i thought!!!!!! a man of that experience being totally ignorant and post nonsense like an uneducated brainwashed kid...he must hate india so so much!!!!

 

[RiazHaq]

Good try old man.. But you are exactly proving my point. The example/illustration/buffetology is saying what I was.. GDP/Revenue and Market cap are surely linked But its not only GDP/Revenue but also growth in GDP/Revenue that drives the MCAP. Understand that MCAP depends on the value that the market puts on your stocks. If the market has confidence on your growth story, thats the time you will find MCAP in multiples of GDP/Revenue.

Say a company/country is growing at 9-10%. It means its revenue/GDP will double in 7-8 years. So if you buy into that even at 2x, you will be at 1x in 7-8 years time. And if the growth expectations are long term as in case of India, in 15 years, you will be at 0.5 x averaging out to 1x. Hence the world is willing to pay a premium in terms of revenue/gdp multiples for growth economies. Why this does not hold well in a US is because of benign low growth rate of 2-2.5% which changes the time frame of 7-15 years to 35-70 years. Hence the MCap/GDP ratio there gravitates towards a little less than 1.

Now if you see Pakistan's economy, the growth rates are of the same order i.e. 2-2.5% at this time due to the last couple of years' mess. And the future is also uncertain till the time this terrorist menance is sorted out. Also, the maturity of the capital markets in PAkistan is low. This is well reflected in the dismal Mcap to GDP ratio of Pakistan..

So while you talk about basics, try and include the complete set and not exclude items like growth etc to suite your own convinience...

BTW not a very good try with the code coolie example. The contribution of services exports is a small percentage in the over all GDP and MCap of India.

Let's try and focus on the topic without getting personal.

India's stocks are priced for perfection. On the other hand, Pakistan's share valuations reflect the current situation and forecasts, which are mostly pessimistic at the moment. But the smart money is still coming in to KSE. Why" Because the history tells that Pakistanis have repeatedly defied pessimistic outlooks in the last 60 years, and Pak markets have performed well over time. The last decade is an example of it.

Pakistan's key share index KSE-100 was just over 1000 points at the end of 1999, and it closed at over 9727.40 on Dec 31, 2009. Pakistan rupee remained quite stable at 60 rupees to a US dollar until 2008, slipping only recently to about 80 rupees to a dollar. In spite of the currency decline, Pakistan's KSE-100 stock index surged 55% in 2009 in US dollar terms and 65% in rupee terms. During the same period of 1999-2009, Mumbai Sensex index moved from just over 5000 points to close at 17,464.81. If you had invested $100 in KSE-100 stocks on Dec. 31, 1999, you'd have over $900 today, while $100 invested in the Mumbai's Sensex stocks would be worth $274. Investment of $100 in emerging-market stocks in general on Dec. 31, 1999, would get you about $262 today, while $100 invested in the S&P500 would be worth $91.

Even with the current share valuations means, there 's a lot more downside risk in India, and significant upside opportunity in Pakistan.

 

[DeathGod]

Let's try and focus on the topic without getting personal.

India's stocks are priced for perfection. On the other hand, Pakistan's share valuations reflect the current situation and forecasts, which are mostly pessimistic at the moment.
Even with the current share valuations means, there 's a lot more downside risk in India, and significant upside opportunity in Pakistan.

And the oracle has spoken.

Because only an oracle can tell if Indian stocks are priced for perfection while Pakistan stocks have been priced by pessimism.

Here is my rebuttal:

1. One cant determine the true level of markets, depends from person to person but most institutional investors follow the prudent investor rule and have tools ( like technical analysis using Monte Carlo etc) to judge where the markets are heading. You cant speak for the lot without data ( which obviously you dont have because you only mentioned returns while ignoring the volatility)

2. Even if the Indian market is priced to perfection , my question to you is that why is any market priced for perfection? It is so because the conditions exist in the country which can fulfill those forecasts. If KSE is priced for pessimism then those conditions exist in Pakistan.

3. There maybe more upside returns possible in KSE but also a lot more risks. As I previously posted, its the reward/risk ratio that matters. Why dont you understand this basic point.

P.S : If you want to indulge in serious discussion on economics then state which formulas and theories are you using to reach to your (bizzare) conclusions

 

[riju78]

Let's try and focus on the topic without getting personal.

India's stocks are priced for perfection. On the other hand, Pakistan's share valuations reflect the current situation and forecasts, which are mostly pessimistic at the moment. But the smart money is still coming in to KSE. Why" Because the history tells that Pakistanis have repeatedly defied pessimistic outlooks in the last 60 years, and Pak markets have performed well over time. The last decade is an example of it.

Pakistan's key share index KSE-100 was just over 1000 points at the end of 1999, and it closed at over 9727.40 on Dec 31, 2009. Pakistan rupee remained quite stable at 60 rupees to a US dollar until 2008, slipping only recently to about 80 rupees to a dollar. In spite of the currency decline, Pakistan's KSE-100 stock index surged 55% in 2009 in US dollar terms and 65% in rupee terms. During the same period of 1999-2009, Mumbai Sensex index moved from just over 5000 points to close at 17,464.81. If you had invested $100 in KSE-100 stocks on Dec. 31, 1999, you'd have over $900 today, while $100 invested in the Mumbai's Sensex stocks would be worth $274. Investment of $100 in emerging-market stocks in general on Dec. 31, 1999, would get you about $262 today, while $100 invested in the S&P500 would be worth $91.

Even with the current share valuations means, there 's a lot more downside risk in India, and significant upside opportunity in Pakistan.

r u seriously being serious????? jesus christ

 

[karan.1970]

Let's try and focus on the topic without getting personal.

Riaz.. Will respond to your note in a while.. However wanted to clarify that the word old man was not used to insult.. Its just that saw your profile in Riju's post and realized you are significantly older than most folks on this forum.. Hence the term.. No derogatory intent..

 

[Jade]

Let's try and focus on the topic without getting personal.

India's stocks are priced for perfection. On the other hand, Pakistan's share valuations reflect the current situation and forecasts, which are mostly pessimistic at the moment. But the smart money is still coming in to KSE. Why" Because the history tells that Pakistanis have repeatedly defied pessimistic outlooks in the last 60 years, and Pak markets have performed well over time. The last decade is an example of it.

Pakistan's key share index KSE-100 was just over 1000 points at the end of 1999, and it closed at over 9727.40 on Dec 31, 2009. Pakistan rupee remained quite stable at 60 rupees to a US dollar until 2008, slipping only recently to about 80 rupees to a dollar. In spite of the currency decline, Pakistan's KSE-100 stock index surged 55% in 2009 in US dollar terms and 65% in rupee terms. During the same period of 1999-2009, Mumbai Sensex index moved from just over 5000 points to close at 17,464.81. If you had invested $100 in KSE-100 stocks on Dec. 31, 1999, you'd have over $900 today, while $100 invested in the Mumbai's Sensex stocks would be worth $274. Investment of $100 in emerging-market stocks in general on Dec. 31, 1999, would get you about $262 today, while $100 invested in the S&P500 would be worth $91.

Even with the current share valuations means, there 's a lot more downside risk in India, and significant upside opportunity in Pakistan.

Would you please reveal you share valuations method? I am really interested in knowing that. Anyway, Performance of an economy is reflected in Stock Exchange performance and not the other way round. It boggles me that Pakistan Rupee has gone down, but the returns have increased by 900% in last 10 years!!!! By the way, by your own calculation nowhere it can be inferred that shares have downside risk in India