From the past 1 year i was sick of hearing from all FII's sitting in US that  INDIA is expensive market compare to its Asian peers.

These FII's are taking their money out from our capital market and giving excuses like India is expensive, other market offers better oppurtunity.

But last week what we saw largest bankruptcy in US history. Iconic companies like Lehman Brothers, Merill lynch, AIG and i am sure there will be many more to come to eat the dust.

All these FII's have taken out to the tune of Rs.74,425 Crore in the domestic market between 7 sept'07 & 7 sept'08 and our Sensex has fallen from a peek of 21000 point in Jan'08 and os hovering around the 14000 Levels.

Why I am writting, to make clear that these FII's quoting Indian market expensive is just a Fake preception which they want to give to us so that they can hide their mistakes. India by far not directly related to these Issues now.

Mistakes: Sub Prime Loan lending

To create the liquidity to meet Bond Liabilities they are selling in International market. The asset including sub prime mortgages backed bond and no doubt many other things that aren't worth as much as Lehman hoped they might be worth. These FII's even not sure that their liquidation has Negative value.

Now all eyes are on other biggies Morgan Stanley & Goldman Sachs, both engage in same line of business.

It will be interesting to see how these financial consulting major perform in their own arena. Will these companies can quote same credibility in future?

Hard times will still be there.

It is a lesson for those countries who are in growth stage like India.

Thanks

Aditya Kachru

Financial Planner & Consultant

The Fund House

http://thefundhouse.tripod.com

Posted by Aditya Kachru at 12:05 PM

Updated: Sunday, 21 September 2008 2:07 PM

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