Tuesday, April 07, 2009

GLOBAL MELTDOWN is good for me



Global meltdown,Pink slips,Stocks stumbling,Real estate prices crashing,Offshore tax evasion, Fae west, Fanny Mae ,AIG ,G20 summit, bailout etc etc , I can go on and on about various other financial terms which has affected the Rich and powerful especially the USA.I have read somewhere that a good economist is the one who foresees the good and bad of visible economy.This comes through experience and foresight.
It is said Napoleon believed in "PUBLIC WORKS" and employing labour. So he made them dig ditches and then asked them to fill them and paid them.We see this happening in most of our Indian cities where modern infrastructure is created in a continuous manner by making and breaking and making again!!!
Being a a low middle class Indian with Monthly pension of Rupees 21,800/-($500/- per month) to be exact after the recent pay commission hike all this high finance is mambo jumbo. I have my own flat, a car and some additional income from some fixed income securities in Government banks.So when this meltdown has brought down the cost of a flat panel full HDTV to rupees 38000/- with dynamic contrast ratio of 50,000:1 which used to cost almost 1 lakh i was thrilled.Even Sony Bravia full HD is available for Rs.50,000/-A camcorder which used to cost Rs.25,000 or more is now available for even Rs.14,000/-After reading David Progues column in NY times i know the quality of pictures is related to sensor and i know now CCD sensor is junk in Japan and CMOS is the in thing.Laptops which used to cost nearly 1 lakh are now costing only Rs.40,000/- Some are available for even Rs.20,000/- .Camera Mega pixels have grown to 14 with corresponding decrease in prices while 8.1 mega pixels are available in mobiles!!!Imported Malaysian sofa sets are now available for even 18,000/- which used to cost 40,000 and more. Full colour scan,copy,fax all in one printers cost only rupees 3000/-.Even shirts(branded) are now costing only Rs.250/- and good pants are available for Rs.500/-
Cooking oil costs only Rs.40/- per litre which used to cost Rs.80/- so are the other items of daily consumption.Plastic items are
making women rush to every sale announced by the malls.We were thinking of disposing off our old fridge and get a new one and
we were getting exchange offer of Rs.2000/- for our old fridge.But my wife has become so generous with the prices of new fridge dropping to 19,000/- from nearly 30,000/- she decided to gift the old one to the maid!!Even giant side opening fridges are available for Rs.50,000/-
Prices of airfares to Delhi from Bangalore has dropped to nearly Rs.2500/- from 8000/-Even European holidays which used to cost all inclusive nearly Rs.2,000,00/- is now available for Rs.90,000/-! for those who can afford that. People who were thinking of buying houses are now getting into the act especially those like me who wanted to settle in Bangalore.
So on the whole this global meltdown has been great for me and others who are middle class and lower. Then who is it affecting? May be Ambanies and Mallayas and those of FICCI and CII. So who bothers?
As USA is printing nearly 2 Trillion dollars and giving it to its banks and Big cats of Industry as bail out, the Chinese are jittery as finally they will be getting this paper for exporting their goods and labor.Their foreign exchange holding may rise but the underlying problem of inability of US to export anything worthwhile to China, except their planes is going to exasperate this problem.Unfortunately China does not buy US arms. So US has to create conditions for export of its arms.Pakistani Army trained Taliban are doing just that for India while North Koreans are doing it for Japan and south Korea. SDR like new currency was raised at
G20 but died down.
I know Manmohan/Chidambaram could not have asked for more during the coming election with inflation almost dropping to zero without much of their efforts. Even opposition BJP is forced to go to Hindutva instead of price rise which used to be a common whipping boy all these years. Personally i would love this Global meltdown to continue as far as possible. Even Bangladesh's cotton and exports are booming as also our car exports.I think NANO is coming at the right time. REVA also should make its mark with aggressive research and cost cutting.It is the future.Our poor know how to survive and i hope our rich also learn from this to innovate, go to new nations,capture new markets and make India a leaner tougher nation.
My only regret is that i blew off Rs.60,000/- on my desktop(only 2 years back) which looks like a ugly junk now when i see that sleek Appledesktop they show off at Forum mall in Bangalore.Now i know Quad processor is the in thing while dual core,core duo are all junk.
By the way i purposely dropped that old yera glass set and accepted scolding from my wife.I really liked that luminarc glass set of six for only Rs.100/- which they were selling at the mall.Men have a natural inclination to go for bargains whether made by foreigners or by better machines.Already Chinese touch screen mobiles are being prohibited in the guise that they do not conform to 16digit IMEI Number.How much long this good times is going to last i do not know but i am going to enjoy as long it lasts even though my wife scolds me for bringing the trash.

"""There are two consequences in history: one immediate and instantaneously recognized; the other distant and unperceived at first. These consequences often contradict each other; the former come from our short-run wisdom, the latter from long-run wisdom. The providential event appears after the human event. Behind men rises God. Deny as much as you wish the Supreme Wisdom, do not believe in its action, dispute over words, call what the common man calls Providence "the force of circumstances" or "reason"; but look at the end of an accomplished fact, and you will see that it has always produced the opposite of what was expected when it has not been founded from the first on morality and justice."""
(Chateaubriand, Memoirs from beyond the Tomb
Treasury Secretary Timothy Geithner told Congress that the U.S. would "launch a new, initiative to address prudential supervision, tax havens, and money laundering issues in weakly regulated jurisdictions." He said, "President Obama will underscore in London on Apr. 2 at the Leaders’ Summit the imperative of raising standards across the globe and encouraging a race to the top rather than a race to the bottom"
But top bankers of America met President Obama and gave him the red line.Former chairman of SEC Arthur Levitt and now with Carlyle group said" It is terribly important that an environment of consensus replace polarization of recent times". They went out of their way to emphasize their hostility to any regulation that even smells of GLASS-STEAGALL like separating investment banking from commercial banking.
We know the bailout is "not founded on morality and justice" and bound to fail.
Meanwhile we middle class Indians should learn to enjoy the bargains.

3 comments:

arayans said...

nice :D

Rainbow Scientist said...

Nice post. I agree. Its the same here in USA. With economic meltdown, services are getting better and cheaper. Prices are falling and you can get good bargain on everything. As long as you have your job, this is good for customer :)

captainjohann said...

Dear Rainbow scientist,
thanks for visiting and comments. It tickles a monitor of dials that scientis can find my post interesting.!!!thanks once again.