wealthymatters

Underestimating Economic Growth

October 23, 2013 2 Comments

wealthymatters

The GDP growth estimate for India in 2009-10 was initially 7.7% but later revised to 8% and finally to 8.4%. The 2010-11 GDP growth was revised from an initial 8.4% to a final 9.3%. Why did this happen? The principal reason was the wide, continuing divergence between trends in the index of industrial production (IIP) and trends revealed by the Annual Survey of Industries (ASI).

The IIP is based mainly on data gathered from large companies, and provides a quick estimate of how things are going. This is the indicator the government relies on for early estimates of industrial and GDP growth. By contrast, the ASI takes time, covers all units employing more than 10 workers using power or 20 workers without electricity. This means it covers the bulk of — though by no means all — small and medium industries. It provides data on value addition, whereas the IIP refers only to production. ASI data comes with a lag of up to two years. This fuller picture is then used to finally revise estimates of GDP and industrial growth. Read more of this post

Filed under Tidbits Tagged with Annual Survey of Industries (ASI), GDP Growth, index of industrial production (IIP), postaday

The Interesting Thing About Money

October 23, 2013 2 Comments

wealthymatters

It can’t be wasted, only misallocated, which is a matter of opinion. If you spend your money, you create a ripple effect known as the Keynesian multiplier where the people you give your money to also spend it, about five times in a year ; good for creating commerce and employing people. If you save your money it becomes available to you and for other people to buy expensive things (homes, cars, etc) that they can’t afford to buy outright. This process also employs many bankers and financiers and creates employment in the factories and in the supply chain. If you invest your money, you enable the creation or expansion of businesses also leading to employment. Even if you burn or bury your money, or just stuff it in the mattress it’s not wasted as you slightly increase the value of all the other money in circulation.So you really can’t make a societal mistake with your money, only a personal one. And case you have enough put by, you can afford some mistakes.

Remember this whenever someone tells you you you ought to do this or that with your money.

Filed under Philanthropy, Theory Tagged with Keynesian multiplier, money philosphy, money wisdom, postaday, wealthy philosophy

Invest In Land In Suburban Villages

October 23, 2013 Leave a comment

Here are the reasons to invest in land in suburban villages:

Filed under Alternative Assets Tagged with investing in land, investing in suburban village land, investing in the suburbs, land investment, postaday

Branson’s Regret

October 23, 2013 5 Comments

Sir Richard Branson,founder of Virgin Atlantic,has one regret he feels hard to live down:his assumption that he could knock Coca Cola to World’s No.2 soft drink by launching Virgin Cola:

“It taught me that if you have to take on someone bigger,you have got to be much better.”