Smart Singh - Your Friendly Neighborhood Investment Guy

In the last post, we came across the term 'bad fiscal policy'. The term is intimidating but the meaning is quite simple. Fiscal policy means how you manage your inflows and outflows or your income and expenses. Suddenly bad fiscal policy sounds familiar to everyone. Most of us practice bad fiscal management every day. Coming back to the point, let's see how the fiscal policies of some countries are responsible for the current European crisis, and how this crisis is different from previous crises.

In the last post, we discussed how your money grows when you invest in a stock. We also discussed what should be the value of a stock. To summarize that point, the value of a stock should be the present value of all the future payments. For example, let's say a stock will give you a dividend of Rs. 100 for three years. And at the end of the third year, it would be sold at Rs. 1500. Now you know that Rs. 100 after one year would be less than Rs. 100 today.

Hi All,

I got this email query from a reader, PT, and I thought that it would be ideal to answer his question through a blog post. When I started this blog, my primary objective was help people who are exactly in his situation. So here is his email.

So you wanted to start farming. Suddenly you realize that you are a professor who romances the idea of farming but really doesn't know how to do it. You are busy teaching students, assessing answersheets and researching alternative sources of energy. You could never find enough time for farming. But you still have that dough (Rs. 10 lakhs) rotting in your vault. A pest called inflation is eating up that dough.