My "apocalyptic" view on Indian Economy

I am indulging in some doomsday soothsaying. Just for the heck of it. Whether it makes any sense to you or not, it does not matter. For now, this doesn't make any sense to me either :-D

Our economy seems to be behaving like a tired snail!

Reserve Bank of India has cut the repo rate 4 times in the past 12 months. They usually announce repo rates every two months. So, 4 out of 6 times they announced rate cut. In last 1 year, from 6.50%, the repo rate has been brought down to 5.40%. The repo rate controls the availability of funds to the investors and businesses. Lower the rate, higher the demand for the money. Or, that's what I understand from my limited knowledge of the financial market.

The Government data showed that the GDP growth has slowed down to 5%. Whatever that means. I am told it is not good, okay?

In August 2019, Indian banks have written off Rs.2.54 lakh crore in bad loans. Written off. Just to get their books to show lesser NPAs. I wish I had taken just 0.01% of it (that's Rs.25 crores!).

Not many takers for the real estate market. Not many takers for automobile market. I also hear that underwear market is down. Reason, it seems is, millennials are renting out homes and cars and not buying them. However, I can't understand why underwear market is down. Millennials, what's up? ;-)

Millennials are not marrying, not interested in children..so marriage market is down and baby product markets are down too. Let's not talk about maternity hospitals...they are getting their share of money through ...well...yes, you got it!

Jet Airways crash landed financially and closed down. Not many people are flying nowadays. Not much is happening over coffee too...

And in the agriculture sector...there are floods and there are droughts...and there are farmers with loans and noose tightening around their necks...

So, based on all these "signs" :

Since the demand (in above sectors are low), it is impacting its production and hence its impacting number of production hours and therefore number of jobs are impacted too.

When people don't have jobs, they don't have money. They don't have money, they can't pay their EMIs. Oh..now I understand why underwear business is down...they stop buying clothes and underwears too. They stop eating out, swiggying, zomatoing, flipkarting, amazoning, ubering, olaing, etc.etc. So, joblessness is bringing down virtually everything - which is part of what we call is "economy".

When they can't pay their EMIs, banks take their homes/cars and auction them. Since the demand is low, there are no biddings there too.

So, people end up without jobs, banks end up with tonnes of NPAs, businesses close down, government loses tax revenue, so they increase tax rates, lots of To Let boards come up. Lots of For Sale boards come up.

Now, people are worried about the economy, so people who do have jobs and money, they are more cautious about spending. That will contribute to slow down. Banks are not paying much interest on FDs. Stock markets are volatile. So, even with money in your pocket, you don't have much to do.

So, what's the way out?

Millennials!

Millennials, start buying cars! Start buying homes! Borrow and spend your entire lifetime in paying EMIs!

Save the economy!

PS: Remember, I was just indulging in doomsday soothsaying ;-)

NB: I remember the good old days when we bought things with the money we had saved. I had bought a second hand scooter in early '90s because I had only that much money.