India's Economic Disaster Continues Brew...

“The most barbaric and basic truth about the Indian state. That it has failed the country's poor” -Sanjeev Srivastava

BBC News Editor Sanjeev Srivastava wrote the quote above in January 2007 in an article about a series of grisly murders committed in the Noida suburb of Delhi by two men who are members of a privileged class and ignored by local law enforcement officials because the victims, all children, were from poor families who lived in a neighboring slum.

The two men were convicted of those killings this week and are due to be sentenced tomorrow in the final chapter of a case that has been a source of newspaper headlines in India for months and is seen by many as a symbol of the class divide within the nation.

The other dominant headline story today was a 152 point decline in the SENSEX in the wake of Industrial Output and Inflation data that point to likely rates cuts by the RBI as the government struggles to meet growth targets for 2009 that seem increasingly implausible. For Prime Minister Singh, still recovering from open heart surgery, this is a battle of political life or death … and India’s elections are looming.
Industrial output registered -1.97% for December, only the second negative year-over-year number since 1993. This suggests that the suspicion we discussed in our post on the 16th of last month that the declining WPI data issued then was being driven by sluggish industrial demand on the subcontinent rather than declining global commodity prices was correct.

We have had a consistently negative bias on Indian equities since we launched the firm early last year, and our thesis rests, in part, on the class divide underscored by the Noida murders. Simply put, We believe that the Indian population, grappling with rampant poverty and poor health and education services, will not be able to sustain internal consumption levels sufficient to sustain the growth levels targeted by the Singh administration.

Andrew Barber

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more

Got Process? Zero Hedge Sells Fear, Not Truth

Fear sells. Always has. Look no further than Zero Hedge.

read more

REPLAY: Review of $EXAS Earnings Call (A Hedgeye Best Idea Long)

Our Healthcare Team made a monster call to be long EXAS - hear their updated thoughts.

read more

Capital Brief: 5 Things to Watch Right Now In Washington

Here's a quick look at some key issues investors should keep an eye on from Hedgeye's JT Taylor and our team of Washington Policy analysts in D.C.

read more