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On Slack: Benami Act, China’s Property Frenzy, Drain Excess Liquidity, Emerging Markets Sell Off, GST Ambit, Islamic Window, Modi-Fied, Recounts Looming, Unaccounted Deposits, White Paper India VIX and more….

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The Slack Discussions

Slack Logo2The Slack group at Capital Mind Premium has been extremely active and if you haven’t been there (Premium subscribers only), pop us a note or login here using your premium credentials.

A brief summary of some of the interesting things discussed there in the last few days:

#general: Sebi relaxes Angel Funds investment rules for start-ups

To further develop the alternative investment industry and the start-up ecosystem in India, securities market regulator Sebi on Wednesday enhanced the number of ‘Angel Funds’ in one scheme from 49 to 200. Money Life

#general: Unaccounted Deposits In Old Notes To Attract 50 Per Cent Tax, 4-Year Lock-In Period

A minimum of 50 per cent tax may be levied on unexplained bank deposits made using the banned currency notes up to December 30 along with a 4-year lock in period for half of the remaining amount under the amendments to tax law the government plans to bring in parliament shortly. NDTV

#macronomics: With recounts looming, Donald Trump adds new administration picks

President-elect Donald Trump pressed forward Friday with two more administration picks, as failed Green Party candidate Jill Stein took new steps to force recounts across key Midwestern battlegrounds that could complicate Trump’s push for national unity. Indian Express
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#general: RBI announces measures to drain excess liquidity

With a move to managing the excess liquidity in the system banking regulator Reserve Bank of India announced today that it woujld absorb a part of this extra cash by applying an incremental cash reserve ratio (CRR) as a purely temporary measure. Money Control

#general: Securities excluded from GST ambit in revised Bill

In a significant relief for stock markets, brokers, banks, and mutual funds, the government has excluded securities from the definition of ‘goods’ in the revised draft Model Goods and Services Tax Law.
Section 2(49) of the revised draft model law states that “goods’’ means every kind of movable property other than money and securities. The previous draft of the Model GST bill had included ‘securities’ in the definition of goods, raising concerns on whether transactions in securities would attract GST. Business Standard

#general: Explained: Everything You Need To Know About Benami Act And How It Can Affect You

A week into the demonetisation of high value notes exercise, quarter page advertisements in newspapers warned people not to let their accounts be used to launder black money. It warned of action under the Benami Transactions (Prohibition) Amendment Act which came into force on November 1, a week before Prime Minister Narendra Modi announced the demonetisation. A quick look at the whole issue of regulating benami deals. Swarajyamag

#macronomics: China’s property frenzy and surging debt raises red flag for economy

Outstanding loans have risen sharply to 40% of GDP but analysts fear the end of the credit binge could trigger a crisis for the wider world. The Guardian
 
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#general: Fearing tighter US visa regime, Indian IT firms rush to hire, acquire

Anticipating a more protectionist US technology visa program under a Donald Trump administration, India’s $150 billion IT services sector will speed up acquisitions in the United States and recruit more heavily from college campuses there.
Indian companies including Tata Consultancy Services (TCS), Infosys and Wipro have long used H1-B skilled worker visas to fly computer engineers to the US, their largest overseas market, temporarily to service clients. Times of India

#general: Battle with Amazon costs Flipkart Internet Rs 2,306 crore last fiscal

Flipkart Internet Private Limited, the locally registered marketplace unit of the online retail giant, has seen its losses more than double to Rs 2,306 crore in the financial year ended March 31, 2016. Economic Times

#macronomics: RBI’s CRR Shock Sinks Banking Stocks, Halts Bond Market Rally

Brokerages expect banks to take a hit as the Reserve Bank of India moved to suck out excess liquidity triggered by the flood of deposits post the demonetisation of Rs 500 and Rs 1,000 notes.
RBI has asked banks to set aside 100 percent of the deposits (NDTL) accrued between September 16, 2016 and November 11, 2016, as incremental cash reserve ratio (CRR). This requirement will be reviewed on or before December 09, 2016. Bloomberg Quint
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#general: Standard Chartered To Cut 10% Of Corporate, Institutional Banking Staff: Report

Standard Chartered is set to cut about a tenth of its global corporate and institutional banking headcount, sources with direct knowledge of the matter told Reuters, as the bank keeps up an aggressive drive to cut costs. NDTV

#macronomics: Indian economy grew 7.1% in first half of fiscal: Minister Nirmala Sitharaman

Despite subdued growth in the world economy, India has maintained a GDP growth rate of 7.2 per cent in 2014-15, 7.6 per cent in 2015-16, and 7.1 per cent during April to September of 2016-17,” Commerce Minister Nirmala Sitharaman told the Lok Sabha in a written reply. The News Minute

#general: ‘Islamic window’ in banks would attract huge Gulf money: ICIF

The RBI’s proposal to open up “Islamic window” in conventional banks will lead to trillions of dollars from Gulf nations getting invested in India, said an organisation pushing for Islamic financial banking. Zee News

#macronomics: Goldman Backs Emerging Market Equities, Blames Sell-off on Carry Trade

Emerging Market equities are finally getting some love after a big sell-off since Donald Trump won the presidential race.
Goldman Sachs says the spillover of reflation – set in motion on expectations of higher inflation and growth under a Trump presidency, besides a stronger dollar – has been harsh on emerging markets, with the carry trade partially to blame. Value Walk

#macronomics: These Charts Show How India Has Become Modi-fied

These charts show how Prime Minister Narendra Modi, halfway through his term, has sought to revamp the daily fortunes of the average Indian. Bloomberg

#bonds: Government considering issuing more market stabilisation bonds

The government is considering increasing the amount of bonds issued under the so-called market stabilisation scheme (MSS) to drain out excess cash from the banking system, economic affairs secretary Shaktikanta Das said on Monday. Reuters

#general: Budget 2017: Post demonetisation, Modi government mulls new housing scheme with just 6-7% home loan interest rate

Looking to boost the housing sector, the Modi government is mulling a new scheme that may use money from the demonetisation drive. According to an ET Now report, the government is keen to boost the housing sector via a new scheme and is already in discussion with the RBI. Financial Express

#stocks: Cash crunch forces 60% Morbi ceramic units to close

Demonetization of Rs 1000 and Rs 500 notes and the resulting cash crunch seem to have virtually crippled India’s largest ceramic cluster in Morbi. Faced with a liquidity crisis, the majority of ceramic tile manufacturers have closed down their units and many more are likely to follow suit. Times of India

#general: Demonetisation Is A “Huge Positive” & “Best Case Scenario” For Buying Stocks: Kenneth Andrade

Kenneth Andrade, the whiz-kid stock picker, has confidently asserted that NAMO’s surgical strike of demonetization is a “huge positive” and that it is giving us the rare chance to scoop us top-quality stocks at bargain-basement prices. He has also given a hint of the sort of stocks that we should focus on. Rakesh Jhunjhunwala

#general: Flipkart valuation slashed to $5.54 bln by investor Morgan Stanley

A mutual fund managed by Morgan Stanley has slashed value of its Flipkart shares by another 38.2%, pegging the valuation of India’s most valuable Internet Company at $5.54 billion in the most significant markdown till now.  Economic Times

#backtobasics:

Books Recommended by Capitalmind Premium Members – Link
Could You Come Up With $400 If Disaster Struck? –  NPR
Money Management Using The Kelly Criterion – Investopedia
White Paper India VIX – NSE India
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