Part 2: An economic Policy for dealing with terrorism( spl cross border terrorism)

we will be explaining much of the remaining parts of this article series by taking certain concepts from economics and modifying it for our purpose. economics based argument for terrorism is important and may be even central because costs, resources and benefits are involved for all parties and like most agents in economy, changing costs and benefits ought to alter their behaviours /response.

While mathematical formulation is not necessary to present some of the arguments, it may be helpful. To understand various aspects of terrorism and counter terrorism and implication for policy we will be introducing certain hypothesis ( apart from the central one mentioned in previous article- that is terrorism is just a low cost war for Pakistan's de facto rulers).

Following concepts will be used as guide to understanding some policy options
1.Production function ( and isoquants or our variation the "iso damage" curves)
2.objective function of terrorism/terrorist org.
3. implication of fixed and variable costs
4. Probability function

to be continued

Introduction : A (economic) policy for countering terrorism

Ever since the intention to write the above article was posted shortly after Mumbai attack a number of articles have uncannily come up in media including certin websites reflecting some of our thoughts. However quick scan of IDSA website or even the articles that have appeared since Mumbai attack shows that none of these have never posited the hypothesis- very convincing one and one which will be central to our thinking on economic policy with respect to cross border terrorism must be based on the theory that Pakistan de facto rulers (in the military domain atleast) are trying to wage a very low cost battle against India. Had this fact been accepted long time back a number of options would have opened up before Indian government

to be continued

Re: Bear market in 2008 and more trouble in store in 2009?

Please read our prediction for Bear market in 2008 made in dec 2007 .Click on the link.Bear market in 2008?( read specially the last section prediction for second half of the year 2008). ( a prediction that we also forgot!!!!)

 

Based on the reading, it is possible that 2009 may be volatile movements of the sort seen in 2008 and further corrections to lower levels than seen in 2008.

 

 

PLEASE NOTE OTHER DAY/WEEKLY PREDICTIONS WILL REMAIN  SUSPENDED UNTIL FURTHR NOTICE

 

Re:Predictions and articles

NO NEW PREDICTIONS WILL APPEAR TILL FURTHER NOTICE.

 

 

 

Predictions and articles

The follwing articles and predictions will appear/start appearing on mentioned sites/blogs

1. Predictions based trading fund trading only nifty/sensex equities ( buying/shorting) will start. It will be both prediction based and information based on www.kal.in and www.ckal.in

2. Can Terrrorist acts be predicted astrologically - an analysis with special reference to Indian situation( on www.ckal.in )

3.Economic Policy for preventing/countering terrorist acts ( on www.IndiaConsulting.in )

Because of data collection requirements articles (2 and 3) may be take time to appear and may be in short series format

Alternative to layoffs in recessionary situations?

Alternatives to Layoffs:

When faced with a recessionary like situation or prospect of one, most firms seem to find it easiest to start with layoffs.In the west this is acceptable but in India layoffs is not taken kindly even by government as seen in recent times.

There are options that can be explored with underlying principle for tackling recession as mentioned in our last piece- try to make as many expenditure items countercyclical as possible so that effects of recession are moderated.

Challenge is to provide firms with alternative to layoffs so that they can save costs but at the same time minimize cuts in spending that may add to recessionary pressures. Here are a few ideas

1. Add cyclicity to PF contribution rule with some flexibility. So if 12% is contribution to PF with equal contribution by employee. Slashing this to 6% or more for a limited time (making it acyclical) will save firm 6% straight away. Secondly employee's wealth effect due to lower incremental addition in PF will be minimal. Thirdly salary in hand of employee will go down ( EDIT: SALARY IN HAND WILL GO UP NOT DOWN)by 6% and in after tax sense perhaps even less (MORE). Hence his/her salary available for spending will actually increase in recessionary times. However this may require legal changes. Employees will have the option to plough back "increased salary in hand" to savings such as PF
2. Salary cuts of higher level staff is less painful than salary cuts of rest of labour force. And very likely when a given saving in cost is effected through salary cuts of highest paid staff negative effect on overall spending may be minimal.
3. Explore trade off between salary cuts and job security where jobs are contractual of(OR) effectively so. Let employees be assured of longer job security in return for forgoing of benefits for a fixed time
4. Where applicable load the compensation structure towards a higher commission/compensation based on sales/business increase without creating unhealthy competition ( through team based performance assessment as opposed to Individual performance).

Firms may think layoffs may save them resources but aggregate result may be opposite. Firstly layoffs will accelerate decline in spending for all firms defeating the very purpose of initiating trimming of workforce. Secondly fear of job losses could change saving/consumption behaviour adding to recessionary pressures. Thirdly layoff as last resort may add to company loyalty, productivity and brand image attracting better talent over time ( as opposed to ruthless employers)

Added and Edited:( nov 30)

• With reference to point 4 above, one of the options that could be explored is not just trade off between longer secure contracts and lower pay( for limited time) but also those willing to exit workforce through VRS.( except that better and experienced workers should not take VRS entirely)
• Lean economic season may be best time for encouraging skill upgradation.Under this conditions part of cost savings may be used for such purpose but such costs can easily be reduced further by sponsoring only part of employee's training cost remaining cost to be met by latter from his/her own pocket. This may( not necessarily will) differentiate more motivated/ambititious workers from the rest

Added ( dec 2)

• One other alternative that can be considered is reducing work hours for a limited time- an option that Tata Steel is considering overseas

Part 9: Summary of Measures to avoid deep recession?

Summary: What India/World can do to avoid deep recession?

 

This piece is just meant to be summary but a few points have been added.

 

 

• Measures suggested here are mostly meant for ongoing recession or possibility of it but others are more applicable for future recessions.
• Current crises is result of mix of supply and demand side factors hence while both need to be taken care of ;demand side measures ( especially govt led) must lead the way and influence supply side adjustments because expectations of future of economy have dramatically changed for the worse
• Measures must be proactive as macro economic models and simple economic theory can suggest direction of economy even before data starts coming in
• Demand boosting measures include: speeding up current projects; higher spending in agriculture ( boost productivity) & rural sector because of higher expansionary effect; promoting during recession non for profit activities by corporate and charitable organizations which may include HH maintenance/repair/expansionary  activities; rate cuts supported by Central Bank/sovereign guarantee which is more applicable in countries hit by sub prime related crises; concerted fiscal stimulus by all countries; special funding by dollar surplus sources to invest in US and Europe. In India Railways with huge surplus and likely to be having a portfolio of approved but idle projects must accelerate spending; launching highly beneficial long term projects such as self contained model cities to boost real sector, stock markets and spending; capital infusion of Banks in US and elsewhere must be conditional; media management to change expectations on future of the economy and looking at alternatives to layoffs
• Supply side: usual liquidity enhancing policy measures; easing terms of payment on large infrastructure projects; as in US Indian real estate Cos must offer variety of payment choices to increase upfront cash availability, increase demand for housing (demand side measure)

 

 

Predictions

As the market is generally bearish, we will be making predictions ( intra day, weekly etc) mostly when bullishness is expected till further notice.However absence of predictions is not to be taken as prediction of bearishnes by default nor all long calls can/will be predicted.

 

 

Imp: we have noticed albeit belatedly a posting on Direct selling ( not deleted so far) on www.ckal.in made on nov 4. This post was not put up by us nor authorized by us. please bring to our notice any unusual post on these blogs

 

 

Predictions for coming week- nov 17-21

Posting of Predictions for the coming week ( on www.kal.in and www.ckal.in ) are uncertain due to long powercuts expected this week and in future.In addition predictions if any may be posted on mobile site ckal.mobi also

Meanwhile enjoy this sand sculpture of Mr Obama. If you have more of such sculptures etc of eminent persons you may post them to me

Coming next on www.Indiaconsulting.in : Part 9: What India/world can do to avoid deep recession? summary

Can we isolate impact of religion and spiritual practices on economic and material outcomes? to participate in this survey please send your interest at wwwkalin@yahoo.co.in

Part 8: What India/World can do to avoid deep recession?

We mentioned about putting in to practice the counter cyclical measures to combat recession as is the normal practice. However timing is crucial. Infrastructure projects take time to get designed and approved but existing projects can be speeded up. (If govts are really trying to accelerate economic growth during recession, why not require govt departments to run higher inventory levels during such times as prelude to speeding up projects- a good way to quickly create demand in other sectors which obvioulsy comes at a cost)

However in this part we will mention another class of spending that could be useful as a counter-cyclical measure. Though no data is available as of now, there is a good possibility in India ( with corporate sector doing well) and perhaps some Western countries that "not for profit spending" or even "Green Spending" could be significant. If we club the activities taken by religious organizations this could be significant. So while normal investments are taken for profit motive and will increase in "good times", these philanthropic activities or activities bordering on this category which are not taken for " usual profit motive" can be increased during times of recession by govts taking a number of measures and providing incentives for the same. Obviously not all such activity can be postponed for such times but governments can declare 4-5 year incentive period on onset of recessions thereby clustering more of such activity during these bad times. Such activities could include construction of educational institutions, temples, ashrams, hospitals etc much of which could boost activity in other sectors

Part 7: What India/World can do to avoid deep recession?

Continued from previous unfinished article


As mentioned economy could be experiencing low interest regime and high liquidity, even so economy could fail to pick up steam- when economy is seen as looking down the barrel of slowing growth locally & globally. These are conditions that we seem to be approaching globally.

It seems that in these times changing expectations could go a long way in complementing "real measures" such as interest rate cuts, fiscal measures etc. Expectations, often used in economic theory, could play a real role in these times. Hence all "soft " signalling devices such as confidence index-( used and read perhaps more in western countries) need to be ethically "manipulated" ( mostly indirectly and almost unconsciously) to inject " a feel good factor" in the economy since personal and perhaps more likely corporate spending decisions is likely to be affected by changing value of these indices

Some of these measures - non exhaustive in nature ( already mentioned in previous articles) could help if they are properly rolled out in business media

1. Major countries acting and seen acting in tandem of which fiscal stimulus is an important component ( such as through G 20 forum)

2. As much as possible ,messages given to & through media about economy by government and corporates must be more positive ( without being misleading) , regular and clearly setting out measures and their likely impact. This will help to change people's and business perceptions about future of economy which has been hammered down by bank failures and all round losses.

3. Corporates must not depend on government to do everything but must invest in measures that are supportive. Laying off workers has a very negative signalling impact about economy . why not consider temporary' salary and benefits cut all around( or rescheduling of certain benefits to a future date). This may have less demoralizing effect than laying off workers. Companies must have teams that brainstorms through these issues and workers becomes party to all decisions

4. Public sectors companies with surplus funds must be encouraged to take up long term investments rather than wait for worsening conditions to get a better price.

5. As a long term measure ( could be implemented) , additional taxes on share trading that could be used in conjunction with governments equity to bolster stock markets in extreme situations ( this is tricky) since stock markets can send strong signals about people's thinking but is prone to exploitation by large funds and traders to aggravate volatility and depressed conditions. long run Profits could be used for social welfare causes

....may be continued

part 7: what india/ worldcan do to avoid deep recession

Part 7: What India/World can do to avoid deep recession?

It seems that there is some confusion regarding the economic fallout that is due to “normal” business cycles and what is being aggravated by aftermath of sub prime crises.

Conditions can exist and we seem to be approaching such conditions in certain parts of the world where even low interest rates and surplus liquidity cannot bolster investment activity and the reverse can happen too . This brings in to focus the importance of two factors - role of business and consumer confidence indices in the improving health of economy


…………..to be continued

Part 6: What India/world could do to avoid deep recession

1. It is being suggested that current crisis is because of combination of overlending to sub prime group, development of financial products without attention to their consequences. And that the problem can now simply be solved by recapitalizing FIs who have lost significant capital.

In my view the unfolding crises is not only due to the above cause or else why would many corporates around the world would be reporting lower profits for last few quarters whereas the full scale of financial crises has come out in open with its consequences only this year and its impact will unfold from here on. Secondly infusion of capital will not fully solve the problem as is being suggested- for the simple reason that FIs are likely to become more circumspect- overlending will be repalced by underlending with even credit worthy borrowers becoming casualties for some time. Hence the case for public works in one form or other.

The unfolding crises is result of two trains quietly hurtling downhill untill they both collided with a bang. First was subprime crises. Second was the overcapacity brought about by era of low interest rates and possible default here too with rising interest rates. Second explains the falling profts in many cases and overcapacity. It seems that FIs evaluate & lend for large -long gestation/long maturity projects factoring in only present interest rates.

2. It may be added and clarified that rural spending would have higher income multiplier effect because lower or exempt tax structure in rural areas/agriculture income and that would put a higher disposable income for spending in the hands of the rural income group. Ofcourse the risk is that unless primary articles are in good supply, inflation could be a worry again

Part 5: what India/World could do to avoid deep recession?

1. It is clear to everyone that US does need to carry out reforms at every level to put its economy on track. However the less it relied on government funding the better. So the question is how US economy could be revived without government spending- without government increasing its debt level? One option could be, if world financial institutions and dollar surplus countries created a SPV with largely equity stakes by all stakeholders which could then take equity stakes in mostly strategic projects and/or on-lend under certain conditions & regulatory oversight to financial institutions and industry in US and other countries most severely effected by current situation. Part of this equity could be guartanteed by US to be converted in to debt after ten years or so- time enough for US to turn around economically. Reduction in Iraq war spending would not only allow US government to improve quality of its spending but all take stake in this SPV. Participating countries would not only benefit from projects that are undertaken but also earn a decent sum from largely idle dollars in their kitty. Inflation risks are negligible from this liquidity injection as much liquidity has dried up in US in wake of financial crises.

2. In the previous article it was mentioned government must encourage and accelerate development of small largely self contained model cities. It may be added that SEZ like incentives may be provided though they are unlikely to suffer from land related controversy in most cases. Such cities are likely to attract, relocate from overpopulated cities and house a large number of sectors like pharma, BPO, IT, educational products industry, part of renewable industry and so on with huge cost savings and better work and life standards

Part 4: what India/World could do to avoid deep recession?

Continuing on the above theme,

1. Measures by and large cannot be ad hoc but must fit in with each country's overall medium and long term priorities. Government in India would be well aware of the difference between urban and rural sector. One key difference is in different propensity to consume- being generally higher in rural/poorer sections or in more labour intensive sectors. Hence govt must speed up spending in rural sector- rural infrastucture and within rural infrastructure on rural roads. Th e reason is higher conumption propensity in rural areas would have higher income multipler effect while accelerating rural road connectivity would have high productivity impact ( as shown by World bank study comparing productivity impact of different forms of infrastructure like road, education, water ,heath etc) .

2. Much of urban infrastructure is in form of neutralizing rather than positive infrastructure- comes up to correct unmet demand, congestions etc and addition of these in urban areas has negative externality as such infrastructure may be accelerating rural -urban migration accentuating such problems. Taking a medium and long term perspective, it is high time that a more proactive effort to develop many more villages and small towns in to complete model involving partnership with private sector. The complete package involving provision of new forms of energy supply, housing and other solutions that is possible in relatively uncongested scenario with public private partnership will have a salutory effect on real estate sector if action is taken fairly quickly, on stock markets, environment, quality of life etc while providing a substantial boost through income multipler effect that is likely to be stronger in rural and semi urban areas.

3. US problems are compunded by its high rising fiscal deficit. However if President elect Obama withdraws troops from Iraq, US economy could see further recession unless compensating measures are taken. Three measures could provide boost to US economy with more positive effects in longer run- signing up Climate change treaty could boost demand for its renwable energy sector and improve falling industry competitiveness; boosting construction industry through participation by dollar surplus foreigners; and a wild thought perhaps if US could win hosting of one of the future Olympics to give a boost to its industry !!!!!!. Finally rather than rest of world looking to US economy to boost their incomes , some of the countries like China, Japan etc could provide fiscal stimulus in their own country to boost US economy to some extent

part 3: what could India/world do to avoid a deep recession?

• Continuing on the above theme,The article by Shri N K Singh referred to earlier makes a interesting suggestion of increasing pace of lagging public investment programme .So after all there is some merit in the inefficiency of public investment programme- govt could improve efficiency of public investment programme and hence check recession without increasing fiscal imbalance. Such budgeted but unutilized resources could be significant
• With several economies gearing up for a rate cut, what could bolster these measures is a limited time “sovereign” guarantee that Central Banks/Govt could provide to banks lending to companies that meet certain financial criteria. This will considerably take out fear prevailing in the lending community and add more power to interest rate cuts etc. Govt in effect could be working like a part time insurance company and even make a neat profit by sharing part of interest income in return for taking over part of lending risk.
  
• To lend stability to stock markets, governments could encourage hybrid of closed and open ended mutual funds by requiring higher dividend share to those opting for closed ended mutual funds in effect taxing open ended MF investors to compensate holders of closed ended MFs who would be imparting more stability to markets in case of crash and cutting down on panic selling.
  
• Bailout by US has serious dissenters particularly those who have to pay for fault for errors of others. Is it not possible to devise penal taxes that bailout beneficiaries will be required to pay once they regain financial health that will somewhat imperfectly compensate those taking over bailout burden?
  

What did and world should do to avoid deep recession?

An article by Shri N K Singh in ToI explores today ( oct 27) explores other options to deal with current economic crises.

One wonders why Govts must wait for economic data to take action. Simple theory and availability of good performing macro econometeric models would confirm the direction of indian economy under "no action or limited action' scenario" and hence need for pro active action

fiscal imbalance is a real concern but it is not going to get any better with economy on a slower growth path. It makes good sense to follow counter cyclical budgetary policy that one often reads about and this situation is ideal for practicing that.

Has RBI erred in not cutting rates? Many think so and delaying such a decision may worsen matters.

It is not clear if some kind of market stabilisation fund as suggested in article above would have desired effect. FIIs may be selling due to presure back home and trying to stabilize the market may not be of much help . Market has tanked so much that significant wealth effect must have kicked in and a further fall of 1000-2000 points would not make much difference to market sentiments or wealth effect. Stabilizing markets could mean just that- buoyancy and wealth effect could take a long time to return. However market experts should to table to discuss further measures to strenghten markets such that indian and foreign pension funds which are long term investors have a greater stake in Indian markets rather some high flying hedge funds out to make quick money.

It is time to revisit incentive structures in financial instutions that may contribute to asset bubbles. After all there must be micro economic measures that could help to turn the money tap off when asset prices begin to become "uncomfortable"( please wait for a incentive game structure problem that if successfully constructed might be put up on this blog).

As stated in an article on this blog about the beginning of this year (click here: subprime crises and dollar deluge) that surplus dollar available with countries like China and India ( may i add - possibly petro countries ) could be incentivized to buy in to beaten down real estate prices in US. That would require more knowledge of US economy and its regulatory measures. Restoring confidence in US economy and its financial system is something that is both urgent and for the greater good of all.

First thoughts: what India/world should do to avoid deep recession?

 

What should India and world do to save a deep recession?

 

I believe what is worse aspect of the current crises is loss of confidence, fear and insecurity especially among the finance community. This will inhibit lending for even safe projects for quite some time. Thus a otherwise mild recession may take deeper roots. Increasing liquidity though important will not be enough.

 

Solution is Keynesian  with government to be main driver not as provider of liquidity to boost demand but other way round. In India with huge funds being pulled out, perhaps GoI should not shy from running a even more balanced budget to boost demand ( without it drop in collections from a  downwardly spirlaling economy may anyway cause budgetary imbalance).

 

With sharp drop in commodity prices and negative sentiments this may be a good time to give and bargain  long term contracts for range of investment projects especially in rural areas( this will additionally boost agricultural productivity). Govt can thus not only lower cost of investment projects but also boost demand and increase liquidity in economy ( give easy start up installments to companies). Inflation fear would probably be misplaced in the current scenario of drying out liquidity.

 

What applies to India is likely to be true for many economies especially USA. Bottomline. Time to be more  Keynesian running an even more unbalanced budget rather than simply try to put more money in economy

 

 

Important

NO PREDICTIONS MAY BE POSTED FOR A FEW DAYS DUE TO IMPORTANT ENGAGEMENT INITIATED RECENTLY

Some further thoughts on " Do People Underinvest in their spiritual growth"

Some further thoughts on Do People Under-invest in their spiritual growth Part 2

1. In the second part of the above topic, it was mentioned that there are two types of positive externality in operation firstly because action of spiritual seekers benefits others for which the former group is not compensated. The second part of externality effect ( which was not fully explained earlier) arises because if beneficiaries are aware of the positive effects received due to spiritual efforts of others, they may well create some compensation mechanism to increase such benefits ( including their own self effort).

It may be added that it is not just unkown nature of final product but also underestimating the effecst and value of ongoing process that will bias efforts towards underinvestment ( taking example of long gestation projects- not knowing well enough income streams in early years)

2. we talked about parallel between conventional education and spiritual education with reference to positive externality. However impact of spiritual education may need more corroborative evidence and associated research work programme. Having said that, its effects nonetheless are being increasingly and implicitly accepted even in corporate circles as employees are increasingly encouraged to take up such programmes and/or facilities/resources allocated for such purposes. This can be interpreted with good reasons as sound "corporate investment" as benefits are reaped through higher productivity and/or lower absenteeism/sick leaves ( we can safely assume that average pay per day /sick leave is lower than average worker productivity in most cases)

3.Given the parallel between spiirtual quest and investment in long gestation projects, it is not just faith and hope but also perseverance & loyalty ( to "technology adopted") that are key ingredients for success

Further thoughts on "Do People underinvest in their spiritual growth"

Some further thoughts on Do People Under-invest in their spiritual growth Part 2


1. In the second part of the above topic, it was mentioned that there are two types of positive externality in operation firstly because action of spiritual seekers benefits others for which the former group is not compensated. The second part of externality effect ( which was not fully explained earlier) arises because if beneficiaries are aware of the positive effects received due to spiritual efforts of others, they may well create some compensation mechanism to increase such benefits ( including their own self effort).
2. we talked about parallel between conventional education and spiritual education with reference to positive externality. However impact of spiritual education may need more corroborative evidence and associated research work programme. Having said that, its effects nonetheless are being increasingly and implicitly accepted even in corporate circles as employees are increasingly encouraged to take up such programmes and/or facilities/resources allocated for such purposes. This can be interpreted with good reasons as sound “corporate investment” as benefits are reaped through higher productivity and/or lower absenteeism/sick leaves ( we can safely assume that average pay per day /sick leave is lower than average worker productivity in most cases)

predictions update etc

No stock market prediction may be available for a few days. Some  special predictions could however be posted

 

 

Also further thoughts and corrections to article posted on www.indiaconsulting.in  will be posted in a few days

 

Tel 09911698256,09312039121

Why People underinvest in their spirtiual growth Part 2

 

 

Do people under-invest in their spiritual growth- part 2?

 

In the first series on this topic posted and published in 2007 ( search the article by key word on this blog) we argued that people are likely to under invest in their spiritual growth on the basis of two interrelated arguments

 

(1)   Some similarity in “spiritual final product’ and “market for lemons” made famous in George Akerlof’s article nearly 3 decades earlier. New and even advanced seekers of “spiritual product” suffer from asymmetric information somewhat similar to observed in case of second hand market. Buyers do not know the real utility of what they are going to purchase until after they have purchased and started using it. This fact, in absence of other interventions leads to breakdown of second hand markets with even new second hand good selling well below the price of identical but new products. Similarly spiritual seekers do not know the quality of product( teachings and techniques)  that is being offered  with spurious stuff entering the “spiritual marketplace” leading to restricted existence of spirituality. Here instead of price adjustment, limited and lower participation may be the result. We also need to confirm whether people end up under- donating to spiritual cause – which may well be the case.

(2)    Second and related reason was the parallel with people’s investment functions. When the final product and timing of its appearance is unknown, it is akin to people ( from their limited knowledge as reflected in reason 1) investing in a riskier long gestation product as opposed to easily available and well known intellectual, artistic or sensory pursuits and hence inviting lower investment in former. Using this investment perspective we are also able to show why “Faith and HOPE” are very important ingredients in persisting with spiritual pursuits- a point that is often repeated across all faiths.

 

Now we turn to another set of closely related reasons which may cause people and societies to under-invest in spiritual growth

 

1. We know from theory of externalities that a polluting industry is overproducing if it does not pay a pollution tax to offset the loss it causes to people from its pollution. If such an industry were required to pay a suitable pollution tax, it may well restrict its production and hence pollution levels. Conversely those industries/sectors such as education may be under-producing because they cause a positive and beneficial change to society for which they are not compensated. (hence the argument for subsidizing education). The example of education as an example of positive externality allows us to compare spiritual education where positive externality is likely to be present as spiritually evolved and evolving persons are able to help others and society for which they are not paid. Of course governments do give blanket concessions in law through provision of cheap land and income tax laws as if internalizing such externality. However such benefits  do not percolate to individual level. So if monetary consideration is one of the important factors of how majority of spiritual seekers divide time between spiritual and material pursuits, then positive externality resulting from spiritual pursuits and hence underinvestment is likely. The use of monetary compensation is somewhat repugnant in this situation – however some form of offsetting arrangement may well lead people to increase their spiritual efforts once they realize it benefits not only themselves but others
2. A second and more subtle form of positive externality is to be noted. If people are positively effected from other people’s spiritual growth directly or indirectly for which they do not pay either because they do or cannot  consciously perceive the positive benefits they are receiving  from others
3. Donations and voluntary service seems two forms of offsetting compensation but they generally operate in presence of spiritual institutions and further due to fact mentioned in summary points 1 and 2 above , such donations may well be short of  reflecting true contribution of spiritual growth to society.

 

The combined message of points (a) and ( b) is that neither spiritual seekers nor recipients of benefits accruing from spiritually evolved & evolving are fully aware of benefits delivered in first case and benefits received in second case leading to underinvestment in spiritual growth ( of course there is large overlapping group which both receives and produces benefits at the same time as in case of highly  evolved  spiritual seekers).

 

 

 

 

 

 

article and Predictions

Intra day prediction will be posted on July 23 for Indian or US market

 

 

 

The article on “ why people under-invest in their spiritual growth- part 2” will be posted shortly on

 

www.IndiaConsulting.in

 

 

 

Performance report of Prediction based Trading Fund(virtual) since April 1

We started this virtual Trading fund to demonstrate the effective of our Prediction based Trading system starting with Rs 10 lacs and trading in US and Indian markets. A gain of 21.8% has been achieved so far with over 69% success rate after 64 executed trades.

 

( On last trade no 82- profit assumed booked at Rs 146 premium even though higher premiums were attained)

 

Index &  Fund growth since April 1, 2008

% growth ( with March 31,2008 closing values as base)

Sensex

-14.5*

Nifty

-15.6*

Dow 30

-7.59

Nasdaq

-0.71

Our Trading Fund

21.8

 

 

*Indian market still open and trading in positive territory at 1.25 pm. US market closed today

 

1. Please note bulk of our trading has been  in Nifty and Dow 30

2. Success rate of about  69% on 64 executed trades ( 44 right, 20 wrong)  and another  18 trades not being executed due to price limits not being  met or duplicate trade (1)

3.All four  indices have seen net loss sine April 1,,2008

 

Details of Trade wise Profit and Loss

Trade no	Profit/ loss (Rs)	Remarks
Trade 1-82	217924	Net gain of 21.8% since april 1,2008 with only 1 prediction posted this week
Trade 82	3400	Indian market- July 4
Trade 1-81	214524	Gain of 21.5 percent till last week since April 1,2008 with net weekly gain of 3.1 %

 

                                                                                                                                                           

Details of previous trades can be read from previous performance reports posted every week since April 1,2008.

 

These live predictions appear on www.kal.in and www.ckal.in

 

Note: Please note from now on we shall occasionally trade based on market information and not just on prediction based “information” to take advantage of widely known short term future trends

 

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