Like any other Govt, India, too, is trying to hide and delay the inevitable.
In 2017, SBI (India's largest bank) and it's 5 subsidiaries were "merged" to prevent a collapse.
In 2018, 3 more large banks were merged by the Govt., all were Govt owned. Those 3 banks were Bank of Baroda, Dena Bank and Vijaya Bank.
Over 100 overseas branches were also shut in several countries.
You may read our projections from Jan 4, 2019 here:
The rumors of mergers of the 3 new banks have been in the news since last year but now after the above mergers have been completed, it appears that the Indian Govt is becoming serious about the next batch of banks which could collapse if not merged.
For those who know India's banking history, PNB itself is a merger with New Bank of India whom PNB had acquired in 1993 due to massive losses in New Bank of India.
For those who know India's banking history, PNB itself is a merger with New Bank of India whom PNB had acquired in 1993 due to massive losses in New Bank of India.
Last year, this news had also come that one private sector bank had a market cap equal to 22 Govt owned banks.
It would be hilarious if it was not so alarming!
22 PSBs together now smaller than HDFC Bank in m-cap: Time for bottom fishing?
Indian Govt is almost bankrupt and is unable to make substantial capital injection in their own banks, raise sufficient tax revenues nor issue any kind of bonds else ratings will be downgraded and interest rates will shoot up, hence, they are trying to sell Public Sector companies but every year they miss the privatization targets by 70% to 90%.
There is no way to cover these deficits, due to high demand for spending by the massive population and the losses in majority of Govt owned companies, no matter who is running the Govt.
Now, Govt is pushing the Reserve Bank of India (India's Central Bank) to give cash that they hold as national reserve fund.
No previous Govt in the history of India has ever asked this from the RBI.
No previous Govt in the history of India has ever asked this from the RBI.
RBI has been objecting to releasing any funds over the last several months.
Therefore, another RBI Governor quit last month under pressure and Govt replaced him with one of their own.
It seems the new Governor is "pliant" and will allow USD 10b plus to be released.
Let us see what happens next because things don't look stable at all in the Indian banking system.
Our advice is to stay away from investing in stocks, bonds or keeping deposits with Indian banks, especially the terribly weak public sector banks, if one can avoid.
Some private sector banks are ok to keep deposits but most are volatile even for stocks and bonds.
However, Axis Bank, Kotak Mahindra Bank and HDFC Bank are amongst the safest as on date.
Our advice is to stay away from investing in stocks, bonds or keeping deposits with Indian banks, especially the terribly weak public sector banks, if one can avoid.
Some private sector banks are ok to keep deposits but most are volatile even for stocks and bonds.
However, Axis Bank, Kotak Mahindra Bank and HDFC Bank are amongst the safest as on date.
De-Dollarization Accelerates: Iran Unveils Gold-Backed Cryptocurrency
ReplyDeletehttps://www.zerohedge.com/news/2019-02-05/de-dollarization-accelerates-iran-unveils-gold-backed-cryptocurrency
Six UAE and Saudi Arabian Banks Join Digital Currency Cross-Border Transaction Project
https://cointelegraph.com/news/six-uae-and-saudi-arabian-banks-join-digital-currency-cross-border-transaction-project
the world is changing and moving away from $$$$
Hello AB,
DeleteYes, this is true.
However, because the outreach of USD is so big worldwide, it is a very slow process to dethrone the King Dollar.
I have been advocating to slowly diversify away from USD since the Yuan was allowed to be owned by foreigners in 2009. I have bought bonds, currency etc in CNH since then for myself as well as clients, just to diversify.
Here is my presentation from more than 5 years ago: https://www.slideshare.net/mnathani/understanding-the-coming-domination-of-chinese-yuan-27356659
My views have been very consistent and mostly have come true.
All these events including the 2 that you show above, are chipping away at the USD.
The final trigger is still in the hands of Saudi/UAE.
Once they accept Yuan for oil (which they have to) else they will destroy themselves in an even worse manner than what has already happened, the headline news will be too much to manage for USA.
This Saudi accepting yuan also I had predicted in 2014 or 2015 to occur in 2018. However, Trump did a deal with Saudi MBS in May 2017 during his Saudi visit whereby Saudi arrested about 5,000 royal family members and took away over a trillion or maybe 2 trillion dollars from them all, officially it's just USD 300-400b. But that's just one Saudi royal family member's net worth. lol.
If you notice Trump is the only person in the world who has gone soft and easy on Saudis after the Khashoggi murder in Oct 2018, until then he used to spew fire on Saudis.
The reason being that Saudis used their trump card to tell Trump that they will accept yuan, hence Trump and USA is planning how to avoid a catastrophe which is why they need to be "nice" to Saudis while preparing in the background, like Saudi/UAE are also doing and preparing themselves but without warning all the gullible expats and even their own citizens.
Since so much is at risk like funding (and banking) for ME countries and military sales and Saudi/UAE coming in all sorts of money laundering lists and travel alerts has begun in the last few years because whatever will happen in Middle East in this year or next will be HUGE.
But I don't believe in bitcoin etc, Its all a scam and is not legal in almost any decent nation nor is it accessible without a computer or electricity and one cannot buy bread in Africa or bus ticket in Vietnam or milk in Brazil with it, so it is legally untenable, not widely acceptable, not divisible hence useless exceot for a few thousand people who have money to lose.
Digital currency like credit cards, electronic money etc is a different thing and will continue to prosper and hence one could consider buying stocks of Paypal, Mastercard and Visa etc all of whom are involved in this space but not bitcoin.
What Iran has done is out of sheer crisis and pressure and same for Saudi/UAE. all fo them in chaos and chaos brings small new ides that may or may not work.
I wish USA would stop being an idiot and remove all sanctions from Iran. They have no right to unilaterally impose a piece of paper and tell hundreds of countries not to deal with Iran.
Their days of hegemony are over, USD, trade etc are all going to go down and no country in this world will listen to America and al will stand up united against American imperialism, which is why we see all these alternate currency ideas are coming to life in various countries one after another.
Thank you for commenting and regards,
The most interesting thing is that FED is going to print papers $$$$$. It goes to controlled hyperinflation of $$$$$
Deletehttps://www.zerohedge.com/news/2019-02-08/fed-bombshell-central-bankers-discussing-if-qe-should-be-used-more-regularly
Hello AB,
DeleteAnother major de dollarization even has occurred today.
For the first time in history, the largest oil producing / reserve nation has opened a bank account in Russia instead of London or US.
All these small actions will lead to slowdown and eventual collapse of fiat based USD currency system that many of us have depended upon for over 40-50 years.
Most young people don't even have a clue how things work and will unfortunately face the worst times ever in the years ahead. Many a fortunes will be lost.
Exclusive: Venezuela shifts oil ventures' accounts to Russian bank - document, sources
https://www.reuters.com/article/us-venezuela-politics-pdvsa-banks-exclus/exclusive-venezuela-shifts-oil-ventures-accounts-to-russian-bank-document-sources-idUSKCN1PY0N3