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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: bart13 who wrote (63568)	2/11/2007 1:19:48 PM
From: Handlarz Piotrek	Read Replies (1) \| Respond to of 116555

few excerpts: nytimes.com MUMBAI, India, Feb. 8 — With breakneck growth, an outsourcing industry that leads the world and hundreds of millions of consumers demanding more class and comfort, India has an economy many countries would envy. But now, after three years of near double-digit growth, signs of a potentially dangerous inflationary spiral are beginning to emerge. Prime Minister Manmohan Singh and his closest economic advisors gathered just last weekend over fears that India’s extraordinary economic expansion was starting to overheat, an issue they labeled as a “key short-term priority.” They may have waited too long. Food prices are climbing for everything from lentils to onions, squeezing the poor. Apartment rents and prices are rising steeply, especially in large cities. Factories that make the country’s increasingly ubiquitous motorcycles are running at full tilt and have still fallen weeks behind in meeting orders from dealers. ............................................... The scarcity has sent prices even higher for existing housing. In fashionable neighborhoods of South Mumbai, apartment prices have jumped close to 60 percent just since last spring. Foreign investors, including oil-rich investors from nearby Middle East countries, are joining the market, bidding aggressively against members of India’s increasingly affluent business elite. Rushabh S. Mehta, a partner at the Royal House Agency, walked through a 2,000-square-foot apartment that had a cheap-looking concrete floor and flimsy wooden closets. But it is in the chic Malabar Hill neighborhood. The asking price is nearly $1.5 million. ...................................................... But while such adaptability helps to explain the long-term optimism of most government and business leaders in India, people in the streets are more worried about the continuing rise in prices. Mukesh Maru, a shopkeeper in Mumbai, pointed to a steel basin of moong dal, a popular type of small yellow bean in especially short supply now, and said that the price had risen to 58 cents a pound from 23 cents a year ago. In the 35 years his family’s shop has been in business, he said, “it’s only in the past year the prices have jumped so much.”