Are we predicting economy?

It Feels nice to be active after 2 weeks of hectic activity. Well i still had time to approve message and reply to some. Today i was seeing Economictimes and found to my surprise that Rupee had touched 44 for $1. It is nice news for folks in US.

Seeing the rupee crossing 44 mark just reminded me of few of my friends turned economists :).Well i said ‘turned econmomist’ because there is always some among you who would be actively predicting future. I often heard few of my friends saying Rupee is going up and $$$$ is going down and it is likely to touch 35 mark.

Infact there was panic among NRI to transfer as much of fund from savings and convert it in INR. well that was last year. I remember the lowest rupee touched was 38.What happened now. It has bounced back to 44 Mark. What happened to our good old economist who were saying it would touch 35.

Well that did not happen atleast for last one year and may be not in the near future. I am tempted to co-relate the happenings to Real estate and stocks.Many would have seens stocks have tested their low and is slowly bouncing back. Real estate currently is still low because of the fear factor of a economy slump and other reasons.

My question is ARE WE PREDICTING ECONOMY by saying things like Real estate would fall, US will go down, $$$$ will fall, prices would go down heavly.

Some might be successful in speculating but no body could get it 100% right. Same story with the interest rates. Even this Jan i wrote saying that interest rates would come down below 11%. Its is reverse trend. Rates have risen and its near 13% for floating rate.

Same with Inflation. No body would have expected it to touch 12-13% from 3-4%. Does it not give a indication that speculating can only result loss of valuable time. For some reason i am under a firm notion that the current RE prices are here to stay if not rise.

I am only seeing this, Prices are slowly increased by Rs 100 per sq ft by builders on an average every 3-4 months. The max incentive i saw recently was the free LCD by ARTHAMONEY. May be few builders are offerin pre-emi waiver etc through tie-ups with banks.

The more you wait, the more you lose. The more expensive it becomes to own your dream home. Rent have hit the sky roof. Residential apartments are now more rented for commercial purpose which fetches high rental returns.

I again repeat, Never try to time the market and if you have the money this is one of the best times to go for your dream home.Never predict the future, Have money invest for a 5 years time period. You are sure to gain

2 Comments

  1. Naveen

    What if $ goes back to 40. Is there a fair value for exchange rate? Nope. It keeps balancing based on a simple outflow/inflow ratio and some ‘speculation’ to top it up.

    Nobody can predict the inflows/outflows precisely so I would say that >=44 is not necessarily a sustainable ratio!

  2. Kushal

    uday,
    Do you know anything about this area ..They have an independent house for sale. Please advise..

    Independent House/Villa in Sithalapakam
    Cithalapakam, Skylab Avenue, Sithalapakam, Chennai Others , Tamil Nadu – 600100

    Thanks
    Kush

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