May 17, 2012
The USD-INR ratio hit a massive 54.3875 (RBI Ref Rate) and 54.56 in the spot market today.
Ooh. This is bad. The crude price falling about 10% from the 124 levels down to 112 is getting offset by the appreciation in the dollar.
RBI has been buying heavily and is conducting OMOs to offset the loss of rupee liquidity. (When the RBI sells dollars, it gets rupees that then go out of circulation. So the RBI uses the rupees to buy GOI bonds through OMO auctions to bring the rupees back in)
The rupee looks like it's going down further and the USD INR Rate is hitting new highs. There are structural problems - the huge trade deficit (nearly $160 billion) is a major factor, and the fact that we simply aren't doing enough to encourage foreign investment. We have traditionally funded our heavy trade deficit through foreign investment inflows and transfers (read: NRI remittances) - today, while NRIs continue to do their thing, FDI and FII inflows have slowed to a trickle. We need to import a lot lesser and export a lot more. We don't need a trade surplus but we could make the deficit a lot less wide.
Original Source: http://capitalmind.in
Posted in ChartOfTheDay, Credit Repair 
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May 16, 2012
Legendary fund manager John Arnold told investors that he was closing the Centaurus Energy fund, to pursue other interests. Arnold was one of the "good" guys in Enron, making around $750 million in profits for Enron the year that it died from upper management fraud, and got a (tiny) $8 million as a bonus.
Arnold went on to start Centaurus, and made more than 100% for a significant part of its existence, and more than 50% in each of the first seven years. In 2006, when it made 300%, it took on the giant Amaranth on a bet on natural gas markets (Arnold was short) and made $1 billion.
The last three years have been tough, though. The fund saw its first loss in 2010. (According to one source, just 4%) 2011 saw a sub-10% return, and supposedly in 2012, the fund is up just 3-4% (hearsay) till May.
Zerohedge says it's probably the new commodity player limits (which restrict the size of each player in a market) and the fact that people are getting into energy futures as a way to protect wealth that promotes the natural player's exit. It's that time when demand and supply matter less than the fact that some central bank is doing a quantitative easing and so people rush to buy energy and gold to save their money from the debasement of currency. So you could wager that it's going to be a warm winter and people need less gas, but one Fed statement will take prices up. Much of the game in energy or commodity futures is based on small moves that give outsized return through the use of insane leverage (some positions can be levered 30-40x). So a sudden rush of money in or out of a commodity can make sudden, large jumps unconnected with fundamentals, and thus destroy the old-trader-with-lots-of-leverage. But there's no pitying anyone - Arnold played his game and left it when he could no longer be king.
Also to those saying trading is a bad thing and trying to use Arnold's exit as an example: his net return to investors over 10 years is probably over 40% CAGR. The last three years have been bad but nothing spectacularly low - they would have gained. And of course, a good thing about the trading business is that you can't be wedded to a trade, so you can quit whenever you like and keep the money.
But it goes to say: today, the micro-strategies don't matter. Fundamentals don't matter. The Macro picture trumps the micro. You have to keep one eye on Greece, another on the Fed, and find other eyes for all those big things that might just happen, and react accordingly. The risk is leveraged trading has gone through the roof.
Original Source: http://capitalmind.in
Posted in Commentary, Credit Repair Comments Off
May 16, 2012
A friend was very distraught when she found the bills weren't being paid. Her son had discovered stacks of unpaid bills hidden in a closet, her husband had drained their son's college fund, and she found massive bills from credit cards she didn't even know existed. Even though she had always felt secure financially, she now knew that the bottom had fallen out of that security.
Original Source: http://EzineArticles.com/?cat=Finance:Personal-Finance
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May 16, 2012
Globalization: the development of an increasingly integrated global economy marked especially by free trade, free flow of capital, and the tapping of cheaper foreign labor markets, this definition supplied by Webster's dictionary. To put this in a more condensed frame, this is when trade extends beyond goods into jobs and careers that will shape the economic growth of tomorrow. With such a comprehensive subject, one can only imagine the impact that this trend, which has been developed meticulously over the past twenty years, will have on future generations.
Original Source: http://EzineArticles.com/?cat=Finance:Personal-Finance
Posted in Credit Repair Comments Off
May 16, 2012
Are you looking for a fast way to make money? If you are in need of quick cash, consider selling your stuff on Craigslist. It is easy, fast and FREE!
Original Source: http://EzineArticles.com/?cat=Finance:Personal-Finance
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May 16, 2012
For most people, credit scores remain a mystery. Sure, a lot of us know 800 is a great score, 700 is good, and anything below 600 is bad. But what actually determines this number? What are the factors influencing this number which has the power to grant you the house or car of your dreams or shatter them into oblivion?
Original Source: http://EzineArticles.com/?cat=Finance:Credit
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May 16, 2012
Investing in annuities is the best way of preparing for a steady flow of money after retirement. It is an investment that ensures a steady flow of money in the old age. There are mainly two kinds of annuity. One must know and collect annuity quotes if they want to invest in it.
Original Source: http://EzineArticles.com/?cat=Finance:Personal-Finance
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May 16, 2012
The relationship between you and your money is a long-term one. For that reason alone, it's imperative that you become successful at managing your finances. In this article, you will discover many helpful hints and ideas to assist you in getting the best outcomes from your financial circumstances.
Original Source: http://EzineArticles.com/?cat=Finance:Personal-Finance
Posted in Credit Repair Comments Off
May 16, 2012
"The interests of the client continue to be sidelined in the way the firm operates and thinks about money." This is a direct quotation from Greg Smith's recent op-ed that he penned after stepping down as a senior executive of Goldman Sachs. Holding himself up as a man of integrity, Mr. Smith couldn't stand working there any longer because "the environment now is as toxic and destructive as I have ever seen it," and he no longer had personal beliefs that aligned with the firm he had once so passionately supported.
Original Source: http://EzineArticles.com/?cat=Finance:Personal-Finance
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May 16, 2012
If you know your options and choices, you can easily make a huge difference to your retirement plans. In fact, you can easily avoid mistakes that are common among people nearing their retirement. For example, people accept annuity deals offered by their regular insurer.
Original Source: http://EzineArticles.com/?cat=Finance:Personal-Finance
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