Why you are paying for Dalal Street greed ?

What did you do to deserve this ? As a responsible citizen, family head you invested in buying insurance for your family. The investments were made in insurance funds. Now, the funds NAV is barely 40% of your investment. Your family protection is lost thanks to the misdeeds of a few. Why ? The issue is not the decline in share prices. The issue is the absurd rally in share prices during the last bull market. This rally was designed to put your money into overvalued shares. Now, the penalty for greed is paid by millions of middle class savers.

The same question is asked by many community banks in the USA. A Bloomberg news says this : Minnesota Bank Asks Why It Pays for Wall Street Greed . Somewhere, something has gone wrong.

Well, some people are getting it right.
A New Zealand firm has decided to close its Hedge Fund after it made 236 percent in the last 12 months. The Black Swan Fund profited from bets on interest-rate cuts in Australia and New Zealand, and the purchase of put options on major stocks around the world, including the so- called BRIC nations of Brazil, Russia, India and China, Haworth said. The manager also bought put options on commodities.
My Notes: And, what are they doing now ? Start a fund that wagers on inflation. This means, they are betting that inflation will rear its ugly head again. That means, rising crude, commodity prices but big squeeze on financials including banks. Worse, if inflation comes into play without growth, we may again have 1970’s style stagflation -w worst of both the worlds.