

Correlation between exchange rates and election in India - zengr
http://www.newslaundry.com/2013/08/hawala-logic/

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ankitoberoi
Quote - "Huge profitability gained by bringing back black money stashed abroad
in order to cover Election expenses".

The rupee can't devalue because of this. Large buy orders would only make the
rupee appreciate. Rather, what would still make more sense is the politicians
and businessmen sending the black money abroad, just before the elections to
safeguard it due to the uncertainty if the next government would support them.

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aqrashik
He is not suggesting that the Rupee is devalued due to money being brought
back.

Rather he is suggesting that the currency is being manipulated using other
means so that money which is brought back from abroad gets a much more
favorable rate when converted into rupees.

Not sure whether I agree with this though

~~~
ankitoberoi
What could these other means be to manipulate the currency in an open market?

I haven't noticed any policy changes and RBI, is primarily selling dollars, in
low quantities though.

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yashg
I doubt this. If Forex comes in India, Rupee should appreciate. No matter
whether it comes through legitimate banking routes or illegal laundering, if $
is brought in Rupee should appreciate and vice versa.

Also I doubt the money being brought in by the political parties would be
enough to move the currency at the scale it is moving.

The charts are misleading. INR has steadily lost value against Dollar over
last 3 decades, more so after 1991. Only during the 2002-2007 period it
gained, because a lot of $$ were coming in. Now that foreign investors are
taking their money out, Rupee is being hammered.

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altrego99
Something is being talked about as being devaluated, but on the chart the line
keeps increasing. I can only guess that what is being plotted is the currency
ratio $/Rs, or how many Indian Rupees makes one dollar. And what then
devaluates, is the value of Rupees in dollars.

To the person who created the news page, for god's sake man, do your charts
right, and say what the fuck is being plotted on each of the axes, instead of
leaving it to guesswork.

~~~
vjvj
You're not an economist are you... graphs could be better but the way it's
done takes an extra 20 secs to interpret.

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Thrymr
Causation? One of the comments points out that the rupee has fallen 25% since
the adoption of the new rupee symbol
([http://en.wikipedia.org/wiki/Indian_rupee_sign](http://en.wikipedia.org/wiki/Indian_rupee_sign)).

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vjvj
Thanks for posting this - this is genuinely one of the most interesting links
I've discovered through HN.

I look forward to reading more comments and hypotheses. Currently the biggest
questions is that raised by ankitoberoi - what other means could be used to
manipulate the currency to such a large extent?

Sure RBI may be selling $ primarily. But what are foreign governments and
private organisations doing? It is likely that they are also playing a role in
currency manipulation.

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denzil_correa
Most emerging market currencies like Brazil. Paul Krugman feels this is
temporary.

[http://krugman.blogs.nytimes.com/2013/08/20/rupee-
panic/](http://krugman.blogs.nytimes.com/2013/08/20/rupee-panic/)

