Markets are Bloody, might make you bleed more..

Markets are tumbling and struggling to maintain their position above 13,500. Today market have reached below 13,500 i.e reached 13,400. Short after Sensex reaching14,000 mark, market skidded down to 12,800 more than 1000 points below in the same week , but soon recovered back.

The contributors for this fall is from all angles, Auto, Bank, Metals ( Both Ferrous and Non-Ferrous ), Infrastructure etc. But the major strike came from the announcement of CRR and IIP weakness data which added up to the decline of the market.

Some Experts expects for a market fall below 12,500 level, but if that is going to be the case, then the nightmare of April will be back in this Christmas and New Year, which will make the investors to bleed more.

But chances are less for reaching below 12,500. Market will sure sustain the mark above 13,000.

One good news which soothes the market fall is, India’s GDP reached the expected level of 9.1%, but on the other side, the inflation is raising and reached 5.1% , but below the RBI’s mark i.e 5.0% to 5.5%.

But, raising GDP might overheat the market and might heatup the inflation too. RBI had ordered banks to increase the reserves in bank, which obviously means that distribution of loans will be reduced.

1 Ton of C02, a Hand full of Cash

Now it is new trend to make money out of the smoke others release. Sounds Wired? Kyoto Protocol, which is signed in in 2005 had lead to a new way of making money for the developing countries from the developed countries. Wonder how? Kyoto protocol, which had been signed to reduce the Carbon-di-oxide level in the atmosphere by 141 countries including E.U, Japan, Canada, with some exceptions like U.S.A, Australia, which are in he exception manifesto, due to high emission of CO2. In the Kyoto protocol, it is mentioned that Carbon can be traded for money like other commodities, but in a quite different way. The term “Carbon Credit” is used for the purpose of measurement in the trading. The country which controls CO2 emission more, will earn more Carbon Credits. One Carbon Credit is equivalent to One Tonne of CO2.

So, the Developed Countries can buy those carbon credits from the developing countries like India, where the emission of CO2 is quite below than the target level fixed by the Kyoto Protocol. Now, If India holds a quite good count of “Carbon Credit”, it can sell the credit to the Developed Countries like U.S for money and use that money to control the CO2 emission into atmosphere by various means of stopping the GHG ( Green House Gases ), like planting more trees etc.

Now, the stage is set for Credit Emission Reduction (CER) trade to flourish. India is considered as the largest beneficiary, claiming about 30%-31% of the total world carbon trade through the Clean Development Mechanism (CDM), which is expected to rake in at least $5-$10 bn over a period of time.

The value of a carbon credit is influenced by the amount of tax levied on the carbon or other greenhouse gas emissions, the penalties provided for exceeding an agreed upon emissions target, the cost to achieve the reduction, and traditional demand and supply of the reduction product.
Source: ICBE

More News at:

http://www.icbe.com/emissions/commodity.asp
http://economictimes.indiatimes.com/articleshow/1212812.cms
http://www.ibnlive.com/news/is-carbon-the-new-hard-currency/20606-7.html

Dabba Trading – The Real Casino

After a long break, I myself had a view to my blog space and felt empty without any new info, so thought of putting a new article which I came across recently and patently an important stuff. Trading Terminal

It is a well know fact that the technology is being extensively used in the darker side. The dark arts users of technology has not left the Money market too. To describe Dabba trading in lay man words , “You put money to get 100 shares, but the software will register only 10 shares officially in the market, and you will see 100 in your screen, which makes you believe that you really purchased 100 stocks, which is specious”. It is not the investor who makes money, the broker who involves in trading on behalf of an investor makes the money, with 10% of cash put in their pockets illegally and unknown to the investor. Also these brokers don’t deal with successful investors, mostly targets the average and pity ones. There are pile of article well explaining about Dabba Trading.

Stock Market Flickers

It was really an unprecedented siutation that a big crash would occur soon in the bullish market. This crash became a big woe for many of the new and existing investor. And more painful and shocking news is a quite a number of people dead on aftermath of crash. Gosh, I donno why these people take such foolish decission. It clearly shows that they are not good traders and don’t know how to trade in the money market.

These laymen are like insects being crushed by a mammoth crash in the market. I was discussing about this to my room mate Hari, who is an investor. I was saying him that one day or soon, the market would touch it’s own back results where it came from. First he didn’t get me, then in short I told him that the market might touch a four digit number soon, if this crash continues.

Market is really really struggling to climb up even a 100 points. Even then it climbs, investors are put in astray and tend to make money whenever the market raises because of the havoc. If this continues, what I am guessing would soon become a reality.

Also it seems that about half of the Foreign investement for India had been stopped in a week. And large COs are still booking profit in the market because of the dropping market. All this combined effort would lead to more havoc.

End of the Days? I-T’s new trick…

It is heard that Congress government is planning to scrap tax exemptions on various policies like LIC, NSC, HRA, Mutual Funds & Other section 80C benefits (Exemptions Upto 1 lakh).

What can Happen ( This scenario is for Salaried Employees ):

– You cannot get tax exemtions on your HRA, i.e. No business of showing House rent agreement & receipts. You will be taxed on the whole HRA.
– You cannot claim tax exemptions by showing LIC Polocies or by having NSC Bonds.
– You wouldnt’ be able to get tax exemtions on Housing loans.
– No Tax benefits on Mutual/Infrastructure bonds
What does government wants us to do:

This is in discussion and government wants people to provide their feedback on these future decisions and will thereby decide by the number of feedbacks received.

** Your feedback is important and will decide how much of our Hard earned money is going to government. ** Please write a short email any one of these guys stating whether you want goverment to continue or discard these exsisting policies by 5th July 2006.
Ms. Anita Kapur, Joint Secretary, TPL-I, Room No. 147-B/I, North Block, New Delhi.
e-mail: jstpl1@nic.in (mailto:jstpl1@nic.in) or
Ms. Monica Bhatia, Director, TPL-I, Room No. 147-D, North Block, New Delhi.
e-mail: dirtpl1@nic.in (mailto:dirtpl1@nic.in) or
Ms. Pragya S. Saxena, Director, TPL-II, Room No. 147-E, North Block, New Delhi.
e-mail: dirtpl2@nic.in (mailto:dirtpl2@nic.in)

IT is also displayed in the running messages in the Incometax department of india website http://incometaxindia.gov.in
http://www.incometaxindia.gov.in/archive/ListofexemptionsunderI.T.Act1961.doc

But they are not gonna scrap entire benefits. Some of the benefits could disappear for salaries if they revise and cancel out exemptions. But they make a major change then most of the money won’t get invested and because of that, lot other things would get affected. Sure that FM would have alternate for it.

Economic Times posted discussion on this matter. Participate in http://o3.indiatimes.com/et_blog/archive/2006/05/17/689726.aspx