The hubris over Indian financial markets is getting a reality check…

Today early morning, RBI announced some measures to boost liquidity in the system.

I mean how the game of building castles begins to fall everywhere is quite amazing. For very long time, Indian stock markets have moved in ways which defy all economic (and even non-economic) logic. Those who questioned were told they are being unnecessarily pessimistic and wanting to create panic.

Who would have imagined that the thunder would be stolen from the woes of banking sector by the exuberance and downfall of the of non-banking sector. People might deny that this is not India’s Lehman moment but there are just too many similarities. Not too long ago, non-banking sector was the cynosure of the market and now the same folks are worried about its downfall and probable impact.

Anantha who is always weary over financial excesses calls it India’s ‘perfect’ financial storm.

It is high time we begin to look at measures of economic development other than this non-stop watching of vagaries of financial markets. The trouble is that we have invested so much in this one activity that we just have nothing else to do..

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