I think this qualifies for my ‘What was that Again’ category.

Finance Secretary Ashok Chawla on Friday said, the Reserve Bank of India’s review policy has taken a balanced view of the current situation and the Cash Reserve Rate hike would not have any affect either on interest rates or the industrial recovery. “In our assessment, the Reserve Bank has taken a very balanced view of the situation,” Chawla told reporters after the RBI raised Cash Reserve Ratio by (CRR) 75 basis points. “The CRR hike of 75 basis points is, in our view, appropriate and adequate because it would only impact the excess liquidity which is in the system,” he said. The RBI’s not taking any other step on the policy rates at this stage clearly indicates that it intends to proceed in a calibrated manner in handling the recovery, he said.

While the BSE Sensex ended flat, the NSE Nifty closed higher, up by 18 points. The BSE-Midcap and BSE-Smallcap are closed up by 1.8% and 2.7% respectively. The rupee is trading at 46.3 to the dollar. Major Asian indices closed lower today while European indices are also trading low currently.

I have been following the inflation scenario closely. I am not surprised with the 75 bp Cash Reserve Ratio (CRR) hike, even though the market was expecting a 50 bp hike. Although, I think that the Finance Minister will have to do more.

A repo rate hike is essential. I believe that all this talk of incipient recovery 'so-lets- not-touch-rates-so-soon', is baloney, and it just serves the interests of corporates to say so.

The U.S. Census Bureau last month released revised population estimations for 21 countries, in which it determined that China’s population is projected to peak at slightly less than 1.4 billion people in 2026, and that India’s population will surpass that of China’s in 2025. As of the end of 2009, the Census Bureau estimates China’s population at 1,323,591,583, and India’s at 1,156,897,766.

Intense pain continued on Dalal Street as stocks across the board took a severe beating today. Investors’ fears regarding rising inflation and the possibility of higher interest rates rocked sentiment today. Cut-down in China’s lending and other weak global data also continued to spook the markets. Today’s worst performers came from sectors like realty, metal, and auto - the heroes of last year’s bull-run. On the broader BSE, just one stock gained today for every seven that closed in the red.

The BSE Sensex and NSE Nifty closed with losses of around 490 points (2.9%) and 155 points (3.1%) respectively. Mid and small cap stocks followed suit. The BSE Midcap and BSE Smallcap indices closed down by 4.3% and 5.5% respectively. Worst performers among the Sensex heavyweights included Tata Steel, DLF, Tata Motors (TTM), Wipro (WIT), and Maruti.

Simply put, an investment in natural resources is a vote of confidence in global economic growth.

Damien Hoffman: Ron, emerging markets are one of the white hot investment spaces now that G-8 countries are in the dumps. What must investors know before throwing cash at places tens of thousands of miles away from home?