Slums.. Are we missing the larger Picture?

Slumdog Millionaire might not have done anything great for the slum dwellers but it has surely made few people very rich and famous, one is them is producer and director Mr Danny Boyle other includes actress of the movie ‘ Latika Fame‘ and last but not the least the slum cast of the movie who are finally having a good time after many ups and downs during and after the release of the movie .

What came as surprise to me is the lack of interest shown by people in attacking the real problem of poverty in slums. Actors like Salman etc are posing happily with the children from the slum who worked in the Oskar winning movie but they are simply ignoring the real issue of the condition of millions of kids who are still deprived of the basic necessities of the life.

Sending the Slumdog kids to school is really a great gesture shown by Danny Boyle but it could have really helped if they can simply build a school for slums in the locality or appeal to the general people to show some empathy to the major cause of slum development.

I think people are missing the larger picture of putting efforts in improving the conditions of slums as a whole and assuming that improving the life of few kids in slum will solve all the problems.

There is also a lack of initiative from the government machinery. We have ministries for urban development and rural development but we don’t have any focus on the slum Development or rather rehabilitation where 60% of the urban population lives. If India has to improve its condition and reputation outside , slum development has to be taken as a first priority .All the issues of poverty , malnourishment , crime and illiteracy are actually originating from the slums and as the population density in slums is very high , it will take significantly lessor effort and funds to improve the condition.

Preventing two wheeler road accidents ..

Freedom without concrete laws and regulations can lead to increased risk in every walk of life; people call it ‘Flexibility Premium’. A prime example of it may be the way Lehman Brothers saw its downfall due to freedom given to its managers to invest anywhere in any kind of security . The freedom and flexibility situation may looks very good initially to all of us but it mostly ends in self destructive mode.

A similar kind of risk can be associated with the driving of two wheelers in India, hardly any adequate regulations to safeguard the common man from falling in the trap of taking excessive risk while driving. When people are dying every day due to road accidents in thousands there is an urgent need of a new driving policy to reduce the rising number of road accident young casualties.

If we compare the US regulation regarding two wheelers, they are very strict. There is a requirement of wearing safety accessories like Helmets, elbow guard, gloves etc while driving a bike in the US and the people are charged heavy fines for violating these rules and even crossing speed levels .In India we have dismal conditions of the roads but even than few people never seems discouraged about showing their talent of crazy stunts and over speeding bike which endanger both theirs and life of others on the road.

Lot of effort is required to improve the conditions of road too in improving the condition of roads tom reduce the level of accidents .With abundance of two wheelers in the country which is one the most popular means of family transport, government may even think of having a special lanes for the two wheelers . It will even make roads easily accessible for non two wheeler drivers.

Are Bulls Back?

Outcome of general elections have changed the face of Indian Equity Markets. People who are staying away from the market are suddenly all excited about the easy money from stock markets.

 Is it really the revival of great Indian bull market which is ignoring all bad news and simply concentrating on the development agenda of the newly form UPA government without the fear of LEFT parties  or its just yet another short lived  trend. I personally feel that there are less chances of it being a sustainable upside trend for long, reason being: -

 

1.      1.  The earnings figure of the companies are still on the declining trend, nearly 33% of the top 1000 listed Indian companies by market capitalization have shown losses in the last Quarter. Majority of the companies are seeing a decline in the EPS growth.

 

2.       2. GDP increase of 5.8% might look very comforting but if look at the breakup of the GDP growth rates only the infrastructure sector has shown good growth with rest of the sectors still far from the last year’s level.

 

 

3.       3. Global recession seems far from over with heavy weights like General Motors filling for Bankruptcies and US markets still struggling for confidence.

 

4.       4. We are facing the challenge of large fiscal deficit and there is a high expectation for the populist budget this year which might stretch it even further. High Fiscal deficit combined with soaring current account deficit can even make a case of downgrade of India’s sovereign ratings which will increase the cost of funding for both the government and the companies of India.

 

5.       5. Low credit off take from banking sector clearly reflects the declining trend in the capital expenditures of the companies.  It can reduce the extent of growth rates and job opportunities both in manufacturing and services sector.

 

6.       6. Delayed Monsoon can negatively affect the agriculture and the rural economy making it tough for recession neutral industries like Food and FMCG.

 

7.       7. Declining exports and increasing crude prices can even the increase the current account deficit of India and with less capital account inflows due to grim external conditions the balance of payment condition of India can denigrate although we are sitting in huge Forex reserves.

 

I can clearly see a classic case of retail investor’s excitement about entering the market when it’s too hot to handle. It’s very tough to predict the direction of the markets but the macro economic factors doesn’t really reflect any signs of sustainability of this rally for long time and I think it will be in interest of the small time investors to go a bit slow on their buying frenzy in a quest to become a millionaire in a month.