Snapshot of this Quarter

Global inflation; many comments are in the floor of discussion about turbulence in the growth of Indian economy. Let me confine my space about IT and ITES industries of India.

As we all know, the basic cause of inflation is due to the surge in the crude and oil prices. This leads to the complete down trend in the almost every nation in the globe.

US is not an exception. Right from the day of dollar getting depreciated, the slow down becomes so obvious. Since, US being the major source for the Indian IT industry, slowdown of the US economy influence the Indian IT industries directly. There are numerous actions taken and carried out by the top officials of every firm to maintain their majestic growth, which they were showing consistently for nearly half a decade.

In these circumstance who won the race in their first lap of this financial year. Here is the snapshot of the results of the last quarter:



Though Satyam is not the leader in this race, their % growth is so significant which attract every one’s attention. Lets meet with the results in their next lap.

Disclaimer: All these facts are my own collection and people who find any contradictions/mistakes, please ignore & take this as a mere fiction.

What does 'Monetary Poilicy' means?

Let me share the information about the monetary policy in some simple words.

The basic objective of the monetary policy are:
1. Controlling Inflation
2. Encouraging growth
3. Financial Stability

When we hear these terms, they may look bit complicated. Let me say these with some simple stories for each.

See, This is the common question that will be raised. If everyone have enough money with them, then where comes the poverty and problem. Then why can't the government produce (print) more money and pass it on to the people?

The answer is simple. NO! It's because let us assume the cost of 1 Kg of vegetable as 10 INR. Suddenly if government prints more currencies and gives to the people and If everyone is made to be a millionaire, what will happen? Everyone gets ready to pay any amount to buy things. Which means the demand will increase.
What will happen if the demand increases and the supply stays at the same point? Obviously, it leads to the raise in the price. If the same extends for a considerable period, this may leads to a situation such that, people may have to take a basket full of money to buy just 1 Kg of vegetable.

Yes! The value of money will go lesser and lesser. What the government can do to control this inflation??? This is a big question. Let me say that in the next part...



Disclaimer:
All the content mentioned above are my own understanding about the article 'MONEY KUMAR and Monetary Policy' relaesed by RBI on November, 2007.