The following is a presentation of TFNN The power trading hour with your host David white Call now call free at 1-877-927-6648 or internationally at<PHONE_NUMBER> now David white and Welcome everybody to another excellent addition of the power trading hour It doesn't matter where you're at As long as you're here at this time The following takes place between 2 p.m. And 3 p.m. Well, we're at the very very top end of the range that options predicted and Again May have a lot of action tomorrow. My thoughts are That we may have some action to a little bit action to the downside It is quad witching tomorrow and of course options on futures expire at 935 Or five minutes after all the stocks are open in the S&P 500 so Generally 935 936 they set all the prices for those then we go to monthly options expiration Of course at 4 o'clock that day So you get a little bit of yin a little bit of yang so look for a little bit more right now We had a market that was a little week to begin with We had a lot of shorting before noon and now we're Watching I think some of those people continue to be short squeezed Months ago we talked about why It is probably a good thing to know that you'll make money about a fourth of the time being short the other time the markets headed back up higher and Could we be irrational? Yes markets are irrational long after you've Decided that you are no longer solvent In the markets and they come to take you away like trading places and take your seat and Yeah, probably going out with a barrel You can still be Easily thinking that you're in a bear market and generally this is the way it is you get two or three days The disrips higher Everybody thinks it's over and you go right back to it now. Can I say that I? Feel much much better if we ever get back down to forty one hundred forty one fourteen and test it with lighter volume during the day Because generally in our day lows not tested on lighter volume are generally not lows They're just going to be revisited later one day and it can be much later but yeah My guess is we're going to revisit that sooner rather than later maybe in the next month and All you have to do is go back to some of the bigger Times in bear markets The one I think most Brightly about is how bad January was in 2000 only to see a fairly decent pop back into mid-March only then to fail for the next three years Until it would actually find a low. What was that low? I want to say 679 in the S&P something like that There's right around in there. Maybe 665 May or March March of 2003 I think that's how long it took to find a low in the markets Of course, we had 9-11 which pushed us a little farther down that way But it wasn't looking good to begin with and generally when markets don't look good and the bad news comes Or the bad events too Give me a call<PHONE_NUMBER>. We'll keep an eye on it, but yeah The everybody keeps shorting this on the way down are now just covering it on the way up And some people are buying but I think for a great deal more you can take a look at this and start thinking about Short squeeze is mostly because of the volume We needed about 18 billion shares to break up through some of these big down days and we've had about 14 billion So we're a little light Totally light. No, my guess is when we're totally light it. That's the end and we'll have really a big run to the downside But at the moment I unless we go a little higher I'm saying forty four hundred on the high side here in 41 14 on the SMP cash on the low side Hard to say about the NASDAQ Because it's a horrible index with six companies making 62% or whatever it is 58% of the entire index and of course the Dow is next to nine kinds of worthless With 30 stocks being 96% institutionally owned It's a it's actually a miracle that those stocks actually change price at all At least you got 500 stocks. You're pretty good into it And if you do just a little back of the envelope statistics, you'll find out That you're talking about 360 380 stocks If you just randomly picked it from trading stocks, you probably have a fairly good Indication or sample size of about six or seven thousand stocks that are actively traded each day And that would give you a good taste doesn't mean it would be the best but Nine times or nine kinds of worthless. Yeah Dow just you know, it's more of a Index that can be pointed anywhere depending on what those institutional owners want to see and of course It's all down to probably five or six stocks on whether the NASDAQ is actually higher or lower 666 March 9 2009 That was another one. I'm talking about the 2003 lows But yeah, that was yet another retest of the march 2000 I want to say march 2003 lows. What were those? Yeah Basil if you can look that up why I'm Discussing stuff. I just remember that very vividly mostly because I bought apple at six dollars and I forget what it was six dollars and 56 cents something like that. I remember the day I bought it Everybody told me it was going to zero The world was ending. It was horrible. Of course They just a few weeks after that ended up getting a big loan from microsoft To help them keep going because cash was a big problem In 2003 and they were burning it over at apple But half a billion dollar loan from microsoft helped a few things and of course microsoft didn't want Them to be the only computer company a large computer company left Uh, they were under of course the thumb of a great deal of FTC investigations and litigations But uh, well, anyway, we're doing about eight billion shares. So is that good? Yes. Is it good enough? Probably not Are we in a bigger wider trading range? Yes, and This is kind of at least for options telling us this is about as high as we go so Yeah, if you're thinking about going short you probably could in here I don't think the reason to go short is shown itself yet Maybe next week and that's uh, also looking at options going ahead and into may But we shall see Uh, thanks for the nice emails. Uh, we'll be back. I'll read a few of those We'll do a little bit of history And uh, we'll start looking at stocks to see maybe there's some decent plays for some white lightning on options exploration Are you grinding in the market? But seeing little to no return or are you a successful trader simply looking to make your job a little easier? 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Watch online at tfnn.com or on tfnn's youtube channel And become the investor you were born to be tfnn educating investors at 1<PHONE_NUMBER> internationally at<PHONE_NUMBER> And we do return 43 94 on the last tick I show here And we'll keep a close eye on the volume, but probably a little light for up here Options roll over on monday and tuesday Wednesday probably the next real unless we get some kind of market moving news which You know, we haven't had any in so long It just how could that even happen? But yeah, that's it I've got some emails Of course, you can follow up to at path at tfnn.com. Give me a call at<PHONE_NUMBER> as we Continue and let's do a little bit of history and then we'll move on to Looking at some charts and some requests out here Okay Oh did I do a I didn't pray my history did I? It's broken Why did it do that? As uh the war generally goes on between windows folks and and uh apple folks It generally gets down to a one big fat whopping lie every time and that is that uh apple and the macintosh um pioneered the windows opera or the window type operating system mouse and all that stuff um On this day in 1988 apple sued microsoft saying that they stole a bunch of stuff well When it got to court and finally solved uh settle in 1995 there was a lot of video evidence That showed actually who stole Uh all the ideas from it and it was uh apple Who stole it from xerox park? Uh who actually showed the first working system with windows And dragged down menus and right and left mouse buttons in 1968 There's a famous uh video uh and showing the future In 1968 and if i'm not mistaken Wozniak from apple actually was attending it I know that they got back together in 19 or in 2008 Uh after uh wozniak and jobs met Doug engelbart, which was the head of the xerox park and some other stuff In back in those days where he was looking at what was going to happen in the future and of course uh One of the other parts of the testimony was steve jobs going to xerox park and looking at the first available computer that actually Was retail sold from xerox in 1979 again. They didn't know what they had Um Most of the people at xerox didn't care about computers They were making a lot of money selling them xerox machines and more importantly the consumables and service Because they both used a bunch of both and half the money uh that they made came in from um Service and consumables they made about the other half on actually selling the machines up front um The razor razor blade kind of business model for xerox And people just couldn't think of why and how people would use computers at home a real as they said at nasa a uh and continue to say a uh a what do they say a A uh lack of uh of uh Imagination Um on those kind of things. Oh, they're rolling out the uh big rocket today, too In case anybody cared that one that's supposed to take us back to the moon I don't know when the thing's supposed to launch or if it's supposed to launch at all just saw that Just briefly the Artemis rocket and uh Artemis actually a fairly good book To by the guy that wrote the Martian about uh moon bases and everybody crawling all over it and the intrigue That happens on it. Although. I do think if you get a chance to get the Uh one called the hail mary a better Uh book but both actually liked uh from the same guy that wrote the Martian But interestingly enough anyway, um So if anybody ever tells you the big lie, which steve jobs continues to tell Tell his death that they actually did it even though he was uh, yeah Absolutely, uh devastated when the lawsuit when came along The only thing I thought was funny was xerox didn't sue them after the lawsuit After it was amply showed that they actually stole it all from them But if you want to know who's responsible the guy's name is dougal Engelbart and uh, if you look up His name on youtube you'll find the video from 1968 that shows everything that's going to come along Oh, okay. So we've got that. Uh, let's go ahead and start looking at some stuff Uh, I got a couple emails that we'll read out here Uh, real quickly as we go out here Um, good call on the rally pretty close to that s and b target I made sure to wipe out all this week's uh expiration put holders and take out their stops Uh, and the way it works. You never really know what was going to happen I was thinking it was going to happen Probably yesterday afternoon it started a little earlier. So my timing was a little bit off But uh, we have uh, john saying excellent call on buying a gold and crude yesterday during the show on air That pretty gutsy. Thank you very much Uh, other things we have out here Uh, that we'll look at um Uh, take a look at fcx See we have anything Uh to to this is for Joe Um You got your three soldiers so Like I said, I don't I'm You know, maybe you get some kind of news thing that helps you but I Bet that we're probably at the end of the rope here for this week and uh You know, I'm not a big 80 percent of the time If you see a market up on ix expiration week on wednesday, then it's down on thursday And if you're not down on thursday, then generally you have a fairly uh bigger area Uh to look to the downside on that friday You don't just get wednesday a thursday friday up now. This is historical And even if uh, it's happens 80 of the time 20 of the time it doesn't But uh when I was looking at uh where we're going to expire tomorrow It looked to me a lot more like 33 50 than it did 3400 But again, we had a lot of people throwing on short sale positions today probably buying puts And that means that generally if there's going to be a decline into friday's close It's probably going to be after 11 after they pulled out all the premium After they've reaped in as much money as humanly possible And it goes to money heaven. Well, they turn around anyway Light volume which I dislike in fcx today. You have uh an update or a down day on the seventh Came down with 27 million shares. You're into with 11 Um, if you're in a money-making position, I take the cash off and re-evaluate tomorrow aam I got uh Several things to look at here from the den. 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I'm actually adding it to my list and download them all during this segment So maybe I'll get to them During the next segment, but we shall see hopefully I added them in there correctly So we'll see what's going on now that we've got the the day halfway through Um, can I look at several things over stock as the first one? uh, ostk right And see what's going on there, uh Did you do let's go back here a little bit less Some gaps and some other stuff So the gap is acting as support This gapped up on a lot of volume and heavy shorting Actually very heavy shorting on the 23rd. You're slightly above that. And did you really go in? You probably want to have 59 bucks. So that probably wiped out those Shorts on that move up to march 1st. You're coming back here. Uh, short sellers have been Pretty short supply light volume The problem is today again, you don't have a lot about a million shares so far today 1.6 million shares yesterday So you're through a previous low that came through or a down candle that came down with 2.3 million shares And it's getting fairly light out here Um, could this be an abc on the way down? I don't think so You had a very excellent light volume pullback from march 1st back here to march 14th with a 3.7 On my power law vector indicator compared to the 12 on the way up. So a lot less energy um But I think uh the word that everybody doesn't see and think about That i've been talking about for the last couple of weeks including the eyes off of gold and crude where everybody Sent hate mail to me for bringing up just the word of consolidation But I think uh if i'm wrong about being a little bit bearish here I'm not horribly bearish because we haven't gotten a signal Up here at 4400 quite yet other than the lighter volume and that could change by the end of the day but um Yeah, I just To me you do have the possibility and the credible light volume up here that that's it You have a double gap at 39 and I would love to see lighter volume test that Uh to make a long term low um It could be a bounce You've got contracting signals. You'd really have liked to see the kind of volume That you saw at least half of the one on the 24th about six million shares anywhere um So more than likely consolidation if you're long this thing back at the test of the gap at 42 39 Which would be somewhere that you might have wanted to step in Um, then you can hang on your yeah, that's basically where where your stop is you close below 42 39 Um, so, you know, you got a possible almost nine dollars down Uh to support So tough Uh, okay. What else do we have? So that's the first one? Uh, lgv in l g in He said Okay, uh, oh, yeah longer on nice move out here um You got your bounce up to 880 you pulled back. You didn't have a lot of volume But you don't have a lot of volume anywhere in this thing Uh, nice move today not a lot of juice. So you're going back in 1.4 million shares back into 1.6 Um, my guess is I do not know but my guess is is probably heavily shorted It's just about anything that is is bouncing today Uh, it's okay. What else do we have? Uh, I don't know that much about Lungver Ron But uh, that's it. Okay. Can we look at deer? Nothing runs like a deer Uh, nice move up here again light volume. This is kind of the whole market I think most of the mar uh juices in people buying the efts and being short them and getting squeezed out And you're seeing a little bit more volume on that today, but most of the equities are fairly light volume Uh, you're going back into a four and a half or excuse me five and a half million share high on march 7th So what do we have for volume today about 1.2? Let's call it 1.2 so far. So is it fine? Yeah, can you retest uh 405 Yes, but doesn't look that great um So there may be a little bit more, but You know, I'd be if I bought at the lows back here at 260 or 362 on march 10th Uh, or even lower. I'd be thinking about time to ring the register Okay Okay MRO And we'll look at that marathon uh fcx We wanted to find out about the options on it. I don't I don't know why this is not working I had them in there for whatever reason maybe I'm not getting the data Yeah No, I've got data I'm just not getting data for fcx on the options, which I do not know why No fcx No, no options. Okay. I don't have any on those. Uh, okay, so we're back to marathon oil a nice bounce um You can kind of look at this ledge That goes back from uh, the first days of february Through about the end of february got into that was support And it acted as support $20 and 80 cents was low. You got a nice bounce up here You'd like to see some volume in the 20 million share range you got about 15 so far So you're probably Kind of doing okay. He had some big up thrust 33 million shares back on the fourth So Again, I think you came off these highs fairly big. I think this is going to be the exact same thing You're not going to race to 130 on on gas. You're not going to run back up to the highs on gold We've got some lows, but they're going to take some work to get through a lot of these folks that bought at higher prices So it's probably a long grind higher It's very hard for me to see that energy companies don't continue to do better When we're instead of using our own oil We continue to go around to third world despots with our hat on our hand Which uh, doesn't make me happy as an american But also makes me just fuming as a consumer Where the it seems like they really want $8 a gallon gas And that's here in florida not where it's already eight dollars a gallon in california Anyway, mr. Oh out here What can you say yeah, you got a gap higher But my guess is the lot of this uh, market's going to consolidate through wednesday next week Let's take a look at sd Sand ridge energy nice Pop up here. No volume though vapor Person to the gap down with 2.3 million shares. You're up to 500,000 If you play this for the pop i'd be out right now We'll be back in a minute Are you in the market for buying or selling real estate in the bay area? Including the surrounding st. 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That's tfnn.com then hit watch tiger tv fancy asks uh Where are the cues options pointing to on the cues? uh for friday's clothes and Man you're you're going through pretty stiff resistance right now um, that's at 340 and more than likely that is the place that it Uh, 340 is where it would actually um expire tomorrow At least that's what options are saying Uh, the error though on the cues is about three times more than on the spies again because uh, they're so heavily weighted to a handful of six stocks um At worst the s&p Has uh its biggest hunk. I think is six percent with apple And it's a little bit better uh looking at it than anything else. You've got a again 440 is kind of the high end There's a little hook. We talked about that earlier in the week Sometimes they call it a hockey stick, but you know, they're generally not huge. They're just subtle But there's a little crick You can see it on both the red and the blue line, which is the puts in the calls both happen about the same Uh point That's it now could we have some news? They're not huge Which means that their resistance. They're not a brick wall But it's hard for me to think that everybody's going to get all jiggy into the weekend My guess is we're going to see some profit taking right now. We're seeing some short squeezes and that's it ideally uh, the center point for expiration um at 440 on the s&p we're at the very high end Of what you should expect uh About 70 of the time 435 is where the uh s&p's would expire So we're pretty high on the right on the right shoulder Of expectations on this But again, a lot of that has to do with how many people continue to pile in And short the market when generally shorting during options expiration Is a bad bet But uh, you know, weird things have happened or news driven And i'm not going to say anything can't happen Uh Okay, we've got more emails here. Uh, did you do okay, so I got that handled Uh, did you um Do I like Uh pl Tm here we talked about it yesterday On the air and it looked at did I do that pl? tm Did I not do that right? Is that the right one pl tm all platinum shares? Okay, I thought you were talking about planet here Um, you got a little bounce at here The biggest problem I have with platinum right now And pladium and all that stuff is uh, I hear a lot about the chances of Um use in that decreasing mostly because higher fuel prices But also of the uh lack of tires and oil going forward for new cars, especially the tire problem Uh that I continue to hear from people that tell me who tend to be in the know and have told me Stuff that has come true in the past They warned me about if he as I said the other day They told me to buy tires if I needed tires or buy oil if I need to change it in the next six months Because he said that uh a lot of that kind of stuff is going to be very hard to come by very quickly It's the next stuff ton of stuff now Uh the good side of this Uh is that it is on the bottom of a three-gap play So Maybe there's something else going on in this segment Uh, I would be wary of it because of car sales probably going down significantly higher interest rates in production problems and beyond just chips for electronics in the dash But my understanding is that they're going to have problems I guess you could buy a car if you wanted sitting on the steel rims But uh, maybe there'll be a problem getting tires for cars and cut back a little bit on that High gas prices of course always tend to hurt car sales And they've never been higher So I don't know um on the positive side You've got a double gap in this thing at $11 and 20 cents. It is going to go there I'm going to say with a 85 percent um Probability that uh you want to have your order in at $11 and 15 cents to sell it I see no reason to not hold it If you bought it back here on the uh low of the day at 972, let's say someone's in this thing at 10 bucks um For me your stop would be a close below $9.72 and your target you'd have to sit on your hands is $11 and Man $11 and 15 cents, but you got a double gap there. It is that's like a magnet single gaps pretty good double gaps, uh, probably The square of that not just a double<PHONE_NUMBER> Uh, Dave again, uh, very good call on gold yesterday during the show. Thank you, sam um Yeah, uh pltm If that's it Question from eddie who asks, uh, if I have a strategy for apple tomorrow and that's generally wait until 11 a.m Uh because generally they'll run it or push it or do something to it the other side And by about 11 o'clock the numbers will come in and I'll give you a better idea So I don't have a strategy generally tomorrow anyway And it being quad witching I generally stand back and let the uh dust settle In the morning and look for light volume moves either way And then uh big differences between that and the options where they may push it or come up with phony Propaganda style news or upgrades or that kind of stuff But generally get a lot of those on fridays. In fact, there's a pretty good statistical Uh thing I saw back in stocks and commodities about upgrades and downgrades on options exploration and even bigger on quad witching days About how many dubious upgrades and downgrades come out. So generally I stay out of the The morning mess and wait until the option premiums are pulled out And look for things that I could buy for a dime or a quarter for options That's what I'll be doing tomorrow. Um Okay, we got pltm Got that got that. Okay, did I get anything else? Uh look at gdx Take a quick look at that Um, I think you got a low I think you got some consolidation to go through now So I don't know what you're thinking. You've got a decent low and an abc But at the same time coming off that it's not going to just rush rush right back up to the highs Probably got several days going sideways if you bought it yesterday Uh, I think you got a pretty good deal or you bought it the day before actually But I thought the low and gold Not being able to be hit yesterday was a pretty good sign too for gold But uh, yeah, probably three four days. I think gold starts heading up bid next week So time to sit on your hands Back in Sharpening your skills as an investor is like getting better at playing a musical instrument You have to practice sure, but you also need excellent instruction from experts at tfnn You'll get advice and guidance from the authority and technical market analysis And it's not just dry tedious text either Tfnn airs live financial content streamed live on tfnn.com and tfnn's youtube channel with tiger tv Live every market day from 8 30 a.m. To 4 p.m. Eastern for free Each host is an experienced trader and gives their take on the market while taking calls and questions live from around the world From the moment the market opens until the closing bell sounds tiger tv has eight different shows with expert hosts To help you make the right moves with your money watch online at tfnn.com or on tfnn's youtube channel And become the investor you were born to be tfnn educating investors You might think that if you want to be successful at trading in the stock market You're going to need a crystal ball after all it's impossible to predict the future, right? Like any endeavor in life before you decide it's impossible get some advice from the experts You might find that it's not so impossible after all for daily market overviews that give you direction on the key indices Selective stocks and commodities subscribe to the opening call newsletter at tfnn.com The opening call newsletter is written by basal chapman creator of the trading methodology known as the chapman wave The chapman wave up down sequence gives you an edge in identifying price turns Finding the peaks and valleys in stock prices get the opening call newsletter by basal chapman and your inbox every day First time subscribers also get a 30 day money back guarantee if you're not satisfied Let us know and you'll get a full refund within 30 days of signing up tfnn.com educating investors Are you looking for a secured investment which pays you on a monthly basis The tiger first mortgage program may be the program for you The best rate on a five-year cd in the country right now according to bankrate.com is paying 1 per year or $1,000 per 100,000 invested The tiger first mortgage program pays 7 per year paid monthly on secured high value buildable properties in st. Petersburg, florida The investment is for four years paying 7 per year or $7,000 per 100,000 invested Your investment is secured by high value real estate in st. Petersburg, florida Your investment can be anywhere from 100,000 to 500,000 You want to make 1,000 per year on 100,000 dollars invested or 7,000 per year on a secured tiger first mortgage The tiger first mortgage program may be just the program for you The tiger first mortgage program pays 7 per year paid monthly for more information You can call<PHONE_NUMBER>. That's<PHONE_NUMBER> Catch Tom O'Brien professional trader and educator founder of TFNN Also a special guest on CNBC Tom will bisect and dissect the markets The Tom O'Brien show next on TFNN As we return a question from the Email is what do I think about good year tire? Um, I don't have time to do it now. It's actually would take a little while But what you want to do is go back into where Crude prices were ultra high last time I think that's 2,850 bucks, whatever it was for the high 180 Anyway, go back and look at those dates and see how well good year tire did with very high Prices, I don't think if this I don't think this is like energy companies Where they're going to do well. They've got About half of their business Contracted out to these car companies, so they're not going to be able to just raise the prices to those guys Maybe they'll be able to raise prices to everybody else, but you know, there's just so much oil that goes into every tire Uh, it depends on what you have, but if you have like race tires, I used to buy I'm trying to remember what they said, but I think it was like 50 gallons of crude To build one race tire and they were 300 bucks back then And that was in the early 2000s so Yeah, just kind of tough to Look at it, but I check at that out. Let's take a look at it. As I said, we're at the very high end of options expiration Things we never thought we could get here just a handful of days ago Um, I thought it would all happen in the last couple of days. It started on tuesday But uh, very interesting action in the markets No Do I think uh the bear market is over? No, I think uh This happens a lot in bear markets everybody just thinks it's going back to normal But I think you got to be I don't know we'll see But I wonder how many people are going to just go for the exit door come friday afternoon as they have been other times Fruit anything else looks safe We shall see So when you can not when you have to go back here tomorrow same back panel same back


Hello and welcome to NewsClick. Today we have with us Professor Jayati Ghosh and we will discuss the year end economy where it is, what it is travelled through and what its future is. Jayati, how do you look at this one year? We have had two upheavals, demonetization which lasted pretty much into the first half of the year. Now, GST which is still sort of unsettling the industry and trade every everybody else. How do you look at the impact of the economy? Well, very clearly its negative. I think what is remarkable about India now this last year is that when the rest of the economy in the world seems to be recovering slightly and when even Europe and gone cases in a number of other countries have been recovering from the previous recession, India is on a bit of a deceleration and its largely internal. In fact its almost entirely internal. That is as you said the impact of the demonetization which still persists because the impact on the informal sector has this very prolonged ripple effects and a very, very badly mismanaged implementation of the GST. Now, it is also interesting that the GST hit has it precise the same sector demonetization tent. The informal sector, the small sector and even in some cases the medium sector, medium sector and small sector. It appears that the working capital has been sucked out of this company and is now in somewhere in limbo and as a consequence that the whole rolling of capital which is what this company is dependent upon is not happening. How do you think this is considered? Well, you know the GST itself there are reasons to actually oppose it in principle on the grounds that it is not federalist and it has all its regressive there are a number of concerns but quite beyond that the implementation has been so utterly ghastly that it actually beggars belief. Most countries that have implemented it have taken between one and a half to three years to actually get the process going and put everything in place. Here the government tried to do it in three months and we are experiencing the results of trying to do it in three months. So it was ham-handed to begin with it was enforced on a completely unprepared informal sector which accounts for as you know about 85 percent of the employment and it was done in a way in which the confusion was so great that nobody knew what the rates were, who is going to pay what, how much you have to pay for the taxes, how much you are going to get as rebate. They have managed as a result this extraordinary achievement of causing prices to rise and lowering their own revenues which I think is unprecedented. Tax revenues in the second quarter of this year have come down sharply, everyone says because of GST the indirect taxes are well below expectation because after the first initial hike when in fact there was very very sharp increases in prices across the board they panicked and they reduced rates for a very large number of items and as a result now the revenues have come down.  Well let's look at the whole issue of GST to start with. It is in principle there are many problems with the scheme. It is something which is anti-federal, which actually denies states the rights to actually raise revenues but apart from that the way it's implemented has actually meant forcing a large number of informal enterprises to enter the formal sector in the most unforgiving way which is to say that they are forced to register, they are forced to bring in their returns, they are forced to calculate their daily transactions to a level of detail that they are simply not used to and they are forced to work out all these different rates for each item of taxation. Now this is not something you can expect a very small player, let's say a small shop, Kirana shop to do, to know all the different rates for all the many goods that he or she is selling, to work out how much rebate they are entitled to ask for all their different suppliers, to know how much exactly to charge their own customers then to monitor all of these on a monthly basis and then to have accountants feed this thing and to upload the tax forms. What to do if they may after maybe three months get some money back as an accounting access? Well very few have actually got their rebates yet, that's the other problem is that we are now six months into the enterprise and very, I think about half of the companies concerned haven't got rebates yet. So there is a real concern and in addition to the effect of working capital being locked up, there is a real rise in costs, just accountancy costs, in tax consultants costs so that even the tiniest shops are now forced to actually pay five to six thousand rupees a month. Which is an underestimate probably more because GST consultants have become the most prized of accountants today. No I am talking about the tiniest shops, you know whose turnover is really very low and whose profitability is also let's say maybe ten, fifteen thousand a month and they are paying five or six. In fact that is one of the things that we saw in demonetization also, the big for instance the lock manufacturers in Aligarh, fed much better than the small shops, the small producers who really handled a completely different scale of production. You know it's true up to a point but I think there is a fundamental problem in India which is that the links between the formal and informal sector are so strong and so complex that you can't really separate them and therefore when you destroy informal activity you also end up humming the formal sector. You disrupt supply chains, you disrupt effective demand, you really make it very difficult. Coming to the other set of issues, how has the country's financial sector stood up in terms of what is the kind of inflows you have had, the trade balances and so on? Has it also affected those? Well you know the strange thing is that in trade terms we are not doing particularly well. Our exports haven't gone up as much as they should have given global export recovery. We are still importing more, not just oil but a whole bunch of non-oil commodities as well. But on the other hand we are getting lots of capital inflows, portfolio capital and also a little bit of FDI and that's very surprising. We are getting lots of capital inflows so global investors are for some mistaken reason very bullish about the Indian economy. It is hot money. It is hot money and what that means is that this is money that can leave at the slightest hint of a problem. And in fact we have seen this already right, we saw this during the taper tantrum when there was a massive outflow of funds. The more hot money comes in, the more vulnerable your economy is to the slightest change in mood. And that change in mood can happen for a political reason, for some other reason happening in some other economy or simply because people get bullish about the United States again. So it's a very vulnerable situation when your balance of payments is relying excessively on large portfolio capital inflows coming in, which is what is happening at the moment. But the industry is not picking up. Domestic investment rates are falling, they continue to fall. And this is what makes even our GDP numbers, I mean lots of people have expressed skepticism, but our GDP numbers are even more surprising given that the same CSO recognizes that domestic investment is not picking up. So what a large part of the recent recovery that people talked about in GDP has to do with finance, insurance and real estate sector. The fire sector, which is a very problematic sector, and with the new GDP series that has shown very high volatility. Interestingly, it's a volatility that is exactly opposite to the volatility shown in agriculture. My colleague Vikas Ravel has written very well about this. He's really shown that if you compare the previous series with the new series, in the previous series finance, insurance and real estate does not show that volatility. In the new series it does. What it has the impact of doing is to smoothen out the effects of the agricultural volatility. And that matters because agriculture has not been performing well. So as agriculture continues to slide and doesn't show much GDP growth, fire is booming. And so when we're celebrating GDP growth, we're really celebrating what is called a bubble economy. What is the prognosis for the year 2018, this year, coming finally? It's obviously the case that it's hard to predict anything in an economy without knowing what the government is going to do. But one thing is very clear that this is an economy that is now suffering from an insufficiency of demand. It's had very heavy blows to informal activity and something has to happen to counteract it. Now the government does not seem willing to provide that kind of equivalent response. Stimulus to the... Stimulus. This is something like pay commission, which is a very upper middle class focused kind of stimulus and it's not enough to counteract the damage that you are inflicting on 85% of the workforce. So I would say as long as this strategy persists, we're going to see this kind of febrile uneven kind of growth, a few bubbles here and there, which inevitably have to burst and these bubbles usually end in tears. The tears could come in 2018, they could come in 2019. That again is a political call. If there are general elections in early 2019, then the attempt will be to postpone the tears through various other devices. Pivotative, increase the deficit and so on. Thank you very much Jayati for being with us. We hope to continue in 2018 what happens to the Indian economy and the global economy. This is all the time we have for NewsClick today. Do keep watching NewsClick, visit our YouTube channel and look at our webpage.