4G speeds

India has one of lowest 4G speed in the world. Reference.

Here are some speeds across the world

Country		4G speed
India	-	5Mbps
Pakistan	-	12Mbps
Brazil	-	19Mbps
Switzerland	-	26Mbps
Singapore	-	46Mbps

Why is India's 4G speed one of the lowest in the world?
Faster speed requires more investment in equipment and towers. India levies a GST of 18% on mobile charges. Countries like Singapore charge no GST i.e. 0% GST. Because taxes are lower in other countries, with same investment, better (faster) equipment can be purchased.

Public sector banks are being looted

Some facts:

• Mallya stole ₹4,300 crore
• Nirav Modi stole ₹11,400 crore
• Vikram Kothari of Rotomac, stole ₹3,695 crore

This is only the tip of iceberg. These scams are being reported on front pages. Imagine how many scams are yet to be discovered. Smaller scams found, are not even reported.

Public sector banks are bankrupt. If you are keeping huge amounts in a public sector banks, then your deposits are at risk. For safety, consider moving your savings to a large private bank that has a much healthier balance sheet.

Indian budget 2018-19

A good budget

• lowers and lessens the number of taxes
• Reduces deficit by reducing subsides
• Massive privatization
• Reduces rules, regulations and size of bureaucracy.

The budget released in Feb 2018 has following characteristics:
The good:

• Corporate tax rate reduced for small companies.
• Standard deduction for salaried simplifies tax laws.
• Senior citizens will pay less tax e.g. Rs 50,000 tax free interest.
• Railway fares not increased.

The bad

• Duties raised on imported goods.
• Minimum support price raised for farmers. This will mean higher prices for others.
• Rs 1,200 crores allocated for universal health care. More subsidies means more inflation/taxes.
• Tax increased for high income individuals

The ugly:

• Deficit rises.
• Long-term tax on stock gains introduced.

Overall this budget is bad. It will cause inflation to rise.

Why stock market is rising?

Stock market has constantly increased during the last few years. Why?
It is because governments all over the world are creating currency out of thin air. This currency is getting invested in stock market. A rising stock market creates the impression that government is taking the right economic decisions. When stock market collapses, governments usually lose elections. So most governments want stocks to rise when they are in power.

When will stocks stop rising?
When the interest rates are above real inflation rate, then it means that governments have stopped creating currency out of thin air. Then, the stock market will fall.

I have nearly doubled my stock market investments in last 5 years i.e. more than 100% profit in last 5 years. As of now, interest rates are below real inflation rate; so I am still invested in stock market.
When interest rates rise above real inflation rate; when USA 10 year bond yield rises above 4%; then I will start selling my stocks.

Why Indians invest in Gold/Silver?

The chart below shows the returns from gold and silver in Indian rupees during last few years.

Interest rates in India currently are about 7%. While the average returns from gold/silver is above 12%. This is why many Indian prefer to invest in precious metals instead of bank deposits.

During the last 17 years (1-Jan-2001 to 31-Dec-2017), average Indian stock market returns are 17.9% (based on Nifty index); but while investing in stock market taxes and commissions are deducted. So the actual return, in hand, to the investor is much lesser. Since most buy/sell of gold/silver happens in cash, usually no taxes are paid. Hence Indians prefer gold/silver investment as compared to stock markets.

Bail in / Depression coming.

World news keeps talking about the poor finances of PIIGS (Portugal, Italy, Ireland, Greece and Spain) nations. The chart below shows the NPA of Indian banks.

India's financial situation is as bad as PIIGS, but the news media creates the impression that India's economy is doing great.
How will this problem end? There are only 2 solutions

1. Hyperinflation.
2. Depression and bail-in.

In Hyperinflation, the government creates lot of currency. This wipes out the debt. But it also causes all savings to be lost. Currency notes become almost worthless. Indian politicians will likely not choose this option voluntarily because the chances of revolt are high. The government will likely fall, if inflation rises.

So India during the next few years will have a depression. The government will likely

• Make high denomination notes invalid.
• But limits of bank cash withdrawals.
• Seize some percentage of currency in bank accounts.

By looting from people, the banks will be saved. Prices of stocks and real-estate will fall by a huge percentage.

To prepare for this bail-in, the government is passing FRDI bill. Prepare accordingly.

Why BJP should suffer in Gujarat?

In 2012 Gujarat state elections, BJP had got 115 seats. In current elections, the results will be declared on 18-Dec-2017. I hope that BJP receives much fewer seats than 115 because BJP has made some big mistakes e.g.

• Demonetization hurt many people.
• GST is causing problems for small businesses.
• Religious fanaticism has increased under BJP rule.

If BJP is not punished, it will get more bold in continuing its existing path.