#BullMarket Corrections of 2005-2008. there were 4 corrections of more than 10% and one 30% !! #Volatility seems very low nowadays !! pic.twitter.com/i7dEEDTynk
— Nooresh Merani (@nooreshtech) September 28, 2017
Author: Raoji
And that is excise taxes on petroleum … which is huge.
If you look at retail price of diesel, it is equivalent to oil prices at $75-80 a barrel. The actual oil price is $50-55 a barrel, so there is a $20-25 per barrel gap between international prices and pump rates.
That is the amount of tax that the government is collecting.
If you bring that down to $55 a barrel, that is almost 40% decline in pump prices, and then you kill many birds with that one stone.
It can be populist, but the important point is it instantaneously frees up disposable income.
It also brings inflation from 4% to probably 2-3% for the next 6-9 months, which opens up space for rate cuts.
So, you get that impact multiplied by rate cuts.
This is the only stimulus that has immediate impact, affects GDP right now, frees up disposable income, allows people to spend, reduces inflation and gets multiplied through rate cuts.
Any other kind of stimulus package will either be saved or have an impact a year from now.
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Linkfest: September 28, 2017
Some stuff I am reading today morning:
How Zee’s Subhash Chandra manipulated the markets (News World)
The economy is tanking (Yashwant Sinha)
What is the opposite of Acche Din? (Sucheta Dalal)
India likely to be a $6 Trillion economy in 10 years (Morgan Stanley)
Shareholders oppose IDFC-Shriram merger (Money Control)
Greedy pricing hits insurance listings (ET)
Mukesh Ambani’s speech at India Mobile Congress (BS)
Stock Talk: Tata Global Beverages (Value Investor)
The need for advice never goes away (TRB)
Saving money & running backwards (Morgan Housel)
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Hey Goldman Sachs, talk to your Mom !!
As per a Goldman Sachs report, local kirana stores are not the best format for India !
Smoking some awesome stuff…
