Why I will STOP investing after Elections (for a while) | Akshat Shrivastava

The speaker emphasizes the importance of watching the video despite its potentially boring content. They discuss the current state of the stock market, highlighting the psychological level of 25,000 for the Nifty index and predicting its breach within the year. The reasons for this optimism include an anticipated interest rate cut, the likelihood of Modi's re-election in the upcoming India election, and the influence of the US election on global markets. The speaker also touches on the Indian currency's indirect peg to the US dollar and its impact on trade. They suggest that post-election, the market will follow fundamentals, and a correction may occur. The advice given is to prepare portfolios accordingly, with a focus on bonds and market-linked debentures for diversification.

The speaker delves into the discrepancies found in India's GDP data, questioning the validity of the high growth rates reported. They discuss the context of these figures, referencing opinions from ex-RBI governors and the potential for India to become a developed economy by 2047 if the 8% growth rate is sustained. However, contrasting data points such as high unemployment rates, a large population dependent on government subsidies, and a low savings to GDP ratio raise concerns. The speaker explains the three methods of calculating GDP: output, input, and expenditure methods, noting a significant discrepancy between the output and expenditure methods. They also discuss the concept of Gross Value Add (GVA) as a more accurate measure than GDP, highlighting the need for a strong correlation between GVA and GDP for economic health.

The speaker simplifies the concept of GVA as the total value of output minus intermediary costs, avoiding double counting, and contrasts it with GDP. They note that GVA is considered a better metric by economists and should ideally be close to GDP figures. The discussion then shifts to the increase in taxes and reduction in subsidies in India, which impacts GVA negatively. The speaker appreciates the reduction in subsidies but expresses concern over increasing taxes. They also cover the composition of India's GDP, emphasizing the rise in public expenditure versus private consumption and the fiscal deficit. The potential reduction in government spending post-elections is presented as a risk to the economy and the stock market.

The speaker outlines the correlation between India's GDP and its stock market, which is significant according to economic data. They assert that the performance of top companies, as reflected in indices like Nifty 50, is indicative of the overall GDP. The speaker then discusses the potential downturn in public expenditure post-elections and advises against investing in public sector companies. They also predict a revival in consumption due to falling interest rates, which would boost private expenditure. Lastly, they propose that credit-granting institutions, such as banks, will gain power in the coming decade, and monopolization across industries will increase, with foreign players entering the Indian market and contributing to wealth repatriation.

The speaker shares their investment strategy in response to the economic analysis provided. They predict a continued increase in wealth disparity, with the top 1% of the population controlling a significant portion of India's wealth. They advise investing in companies that cater to luxury goods, as these are expected to be in demand among the wealthy. The speaker also warns against investing in public sector companies due to expected spending cuts. They anticipate a shift towards private consumption as interest rates fall, benefiting sectors that offer credit. Lastly, they predict increased monopolization in various industries and suggest that foreign companies entering the Indian market will repatriate much of the wealth they generate. The speaker concludes by stating they remain bullish in the short term but are turning bearish in the long term and will share further steps for portfolio protection in their member community.