Saturday, May 27, 2006

So Far Rs 7702 Crore Exits!

Yesterday's figures (May 25th) were disheartening again. The FIIs pulled out another Rs 1,635 crore, bringing the May figures to Rs 7072 crore. This amounts to about $1.5 billion, which should end the selling spree. In fact, this day, (May 26th), the Nifty moved beyond the 3,256 mark but could not sustain above it. This means that 2,760 still holds and we can see this some time. When this would happen is difficult to predict but the 2-year low is still to be made.

Today's global indicators are showing that Dow and Nasdaq registered their first straight 3-day upmove. The FTSE and Nikkei were also up. The US economy appears to have cooled off if one went by the inflation figures which were lower than Fed estimates.

Monday (May 29th) would be interesting and many are awaiting it with great anticipation. The last hour closing was a doji and one learned friend says that this may be an indication of reversal.





Consider how the crisis has unfolded over the past eighteen months. The proximate cause is to be found in the housing bubble or more exactly in the excesses of the subprime mortgage market. The longer a double-digit rise in house prices lasted, the more lax the lending practices became. In the end, people could borrow 100 percent of inflated house prices with no money down. Insiders referred to subprime loans as ninja loans—no income, no job, no questions asked. - George Soros in latest book

everything’s going up, there’s a feelgood factor and people tell each other how much their houses are going up at dinner parties,” says Professor Mark Stephens of York University’s Centre for Housing Policy. “Then the music stops, as it always does.”

year, Japan was a more attractive market to put money in. If you look at the US, we can now get an internal rate of return of 25% there, so why would anyone want to come to India?” - a senior executive at an international financial services group, who did not wish to be named.

people told us house prices never go down on a national level, and that there had never been a default of an investment-grade-rated mortgage bond, "Mortgage experts were too caught up." - John Paulson, trader, who bet against subprime market and made $15 billion.

most puzzling are the real-estate projects of Parsvnath. Just have a look at the Pride Asia project near Chandigarh. They are asking almost US $300K-$350 K dollars for 2 bed room apartments. They have Villas in this project that costs more than US $1.5 million dollars. It is true that some people in India have that kind of money in India. However most of their wealth is black money and that can not be used to buy these properties. Obviously, these projects have been launched keeping NRIs in mind. - Sanjeev, comment from another site

Desai, aka Bani, the star of Balalji Telefilms's soap, Kasam Se, has been house hunting for over a year. She had almost closed a 2-BHK deal last year for Rs 1.5 crore in a Oberoi Constructions' building located at Andheri, Mumbai, but when she went back to confirm it, she was asked to cough up Rs 2.61 crore. Since then, she is still house hunting. - Mumbai Mirror


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