Cabal plans October meltdown in share prices to rout BJP

Cabal plans October meltdown in share prices to rout BJP

By MADHAV NALAPAT | NEW DELHI | 4 February, 2018
A former UPA minister is trying, secretly, to engineer a meltdown in stock market prices by 1 October this year.

A prominent politician, who was a minister during the Manmohan Singh government, is behind a move by as much as 31 brokerages and international and domestic financial agencies to secretly engineer a meltdown in stock market prices such that market indices lose around half their 2 February level by 1 October 2018. They are working in tandem with a few officials in key ministries, who have lately renewed or expanded their contact with the politician in question in the expectation that he will return to a top position in a future government, should the BJP go the A.B. Vajpayee way next year and fail to get re-elected. The politician’s business associates in India and abroad are hopeful that he may even get “the highest job”, according to a senior official tracking the activities of the former minister. A colleague estimated that “at least Rs 39,000 crore was made by the minister while in office just through stock market manipulations”. An officer dealing in the financial sector explained that the minister would use the information and clout of a particular ministry to move share markets in the direction most profitable to him and those friends and family who joined with him in such speculation. “If the Finance as well as the Commerce & Industry Ministries worked in tandem, and if they had a high-level confidential source in RBI as well, they could make policy announcements (or hints) that would immediately push up or down prices of certain stocks”, an official explained, adding that this was precisely what was done during the minister’s long tenure in office. 

If coordinated moves were designed so as to drive prices artificially up by making retail investors flock to certain stocks, the minister would subsequently influence government agencies through trusted officials to purchase stock and “make huge buys at elevated levels”, a senior official explained. These would “mostly be the shares purchased earlier (at much lower prices) by the minister and his cabal (of friends and family), by using foreign institutional investors and devices such as Participatory Notes, so that they cannot be identified”. The officials said that it would be “child’s play” to check the share purchase docket of agencies such as LIC or other state-controlled financial giants to determine which shares were bought during 2004-2014 at prices that soon afterwards crashed. He went on to say that this was surprisingly not attempted by the present government. He added that “the (former) minister has seen to it that the officials who connived with him have almost all been given important responsibilities even to this day, hence their loyalty to the man”. In other instances, leaks made through business newspapers and television channels were carefully designed so as to depress prices of select shares, and once prices fell significantly, the minister and his cabal (including associates in trusted brokerage firms and stock exchanges) would buy such shares through the anonymous FII route. Once the shares were bought, “fresh announcements in the form of rollback of earlier statements, or positive hints about policy towards the sector in question would be given. This would send up prices of target companies, at which time the shares bought at low prices would be sold.” The sources said that “by this fail safe system, the minister and his cronies and kin made enormous sums of money working entirely through the banking system”, a part of which was later brought back into the country through FIIs, and some cash through hawala routes. “Certain brokers, many of whom operate from Rajasthan and Punjab, are close to the (former) minister. They are neck-deep in hawala transactions, and are the channels that are being used to bring cash back into the country”, a senior official claimed. “These brokers need to be investigated seriously for their hawala links, but so far even SEBI has done precious little against them”, an official said, adding that he was hopeful that this may change in view of the fact that “some outstanding police officials have recently been given responsibility for investigating hawala channels”. 

Amazingly, the former minister is claiming credit for both the negative opening of the Singapore stock exchange on 2 February, as well as the unusual warning by Fitch rating agency that higher welfare spending in the budget just announced would impact India’s upgrade. Fitch’s comment was unexpected and the former minister has claimed to his associates that his “friends” in New York, London, Singapore and Dubai will ensure that Moody’s, Standard & Poor’s, as well as Goldman Sachs will soon issue similar warnings on India. The “October Meltdown” cabal expects these coming negative international comments by the very agencies that the Narendra Modi government is showcasing as his boosters, to spook financial markets. 

In the weeks before the Union Budget was presented, reports appeared about likely measures, including a tax on long-term capital gains. In the past in many cases, were a report about a proposed budgetary measure to get revealed in the media, that step would have been cancelled, but in the case of the 2018-19 Union Budget, the government has gone ahead with the announcement of a tax on long-term capital gains despite media reports forecasting exactly such a move. “The cabal was confident that the measure would be introduced despite the media reports. They however advised unsuspecting clients to buy stocks.” The stocks bought during the pre-budget period by retail investors were in large part those being offloaded at the same time by the 31 brokers and other financial players behind the “October Meltdown” cabal led by the former UPA-era minister, who interestingly was the same individual who got planted the fake news report about a “coup attempt” by the then Chief of the Army Staff, General V.K. Singh. “The very brokers who advised unwary clients to buy were themselves at the same time short-selling their own stock through proprietary and offshore accounts, including those controlled by the former minister and his kin.” As all such transactions are taking place through the FII route and anyway official agencies seem to be looking the other way, officials say that the “October Meltdown” cabal is confident that they will escape any consequences for the actions they are taking to ensure that retail investors suffer immense financial losses as a consequence of the manipulations indulged in by the gang. “The only problem facing the cabal is that it will cost about Rs 3000 crore to engineer a crash of sufficient proportions.”  Those aware of the operation claim that the UPA-era minister is presently willing to spend only Rs 500 crore of his own stash in the operation, but that he has raised another Rs 650 crore from others. An official forecast that the former minister will pony up “as much as Rs 2,000 crore, but only if he is confident that he will get the same rank in a post-poll government as he enjoyed during the UPA period”. A colleague of the official added that the ambitious and brilliant politician from a large state “does not want to be the Subramanian Swamy of the new government, who does the heavy lifting bringing down the image of the rival party and then gets peanuts as reward, the more so as the moves made by him would be carried out in secret, unlike Swamy’s, which were all in the open”. 

Many of the senior members of the cabal, including brokerage firms close to the former minister, retain close contact with senior officials and politicians in the present government, several of whom the former minister had assisted while he was in office. Many of the officials who worked closely with the former minister in facilitating his moneymaking operations retain positions of high responsibility in the present government. Once he took charge as Prime Minister, Narendra Modi decided in a statesmanlike gesture to avoid a housecleaning of the bureaucracy by removing those linked to the previous regime. Instead, many such officials have been given honour and respect by the new government, as well as multiple promotions. Unfortunately for Modi, some of these officials have continued their confidential contacts with their previous patrons, and are favourably inclined towards a change in government. The UTI scam that cost millions of small investors their savings played a key role in ensuring the defeat of the BJP in towns and cities across India in 2004. Should there be a stock market crash on the scale planned by the “October Meltdown” cabal headed by the former minister, once again towns and cities across India are likely to vote against the BJP. It may be remembered that in the Gujarat Assembly polls, only a strong showing in urban areas ensured the return to power of the BJP, and this in Modi’s own state. A stock market crash would be sufficient to persuade even Gujarat voters to look elsewhere the next time around. 

The officials concerned gave examples of the manipulations of the former minister, including in the sale of a mining entity in Goa, whose share price was temporarily lowered (during negotiations for outright sale) as a consequence of a budget announcement made by the finance ministry during the UPA regime. Once the transfer of the company took place to friendly hands (at a low price), the final budget proposals withdrew the very budget announcement that had temporarily depressed the mining company’s stock so as to enable its purchase at a low price. “There are dozens of such examples of manipulation of share prices, but no one seems to be interested in looking into them”, an official said, adding that SEBI has been “worse than useless” in checking much of the misuse of stock exchanges for enrichment through price manipulation and insider trading. 

Should the former minister be given an assurance by his party that he will be pitchforked into high office after the polls, the BJP may be in for an electoral ride made impossibly rough by the newly formed “October Meltdown” cabal using its deep pockets to engineer a steep and steady fall in share prices during the period preceding the Lok Sabha elections. 

There are 97 Comments

Would PM Modi pay any heed to Dr Nalapat's warning? A deaf ear is what the PM has given to Subramanian Swami's warnings until now. So why would it be any different in this case? One wonders. But then, maybe the the strong instinct of a political survivor would surge up furiously within the PM and drive him to put paid to the cabal and its diabolic plot.

Manmohan Singh is blamed as Puppet of SG.But what we saw in last 4 years is that Narendra Modi si also reincarnation of Manmohan Singh.He is a Puppet of Arun Jaitely who dictates terms to him and he just carries his orders .THIS budget showed that it is stamped by AJ not by NM

Only one devoid of any Intelligence or understanding of how the Government works would make such a comment. But then we know followers of pappu are neither intelligent not worthy of the attention they desperately seeking!

Absolutely correct

Absolutely correct

Paying heed to actionable advice and hearing of plots which cannot, under a democracy, be emasculated may sound similar to one ignorant of law and economics but are vastly different beasts for those with sense!

Impossible for the PM to learn. Jaitley will be responsible for the fall of BJP.

Why not name the person in question? Is the govt so inept, that it will not come to know about such designs. Make that person's name public along with proof. So that punitive action can be taken .


Why is it needed to take a name and face legal trauma ? It may be a bit wide but not completely off the mark.

There was no meltdown in Oct. 17. Sharemarkets went to all time high until budget day and then crashed and even government says there are not surprised. Yes much of Chidambaram's games are not surprising. But they are not able to pin down kartik with evidence?

Sir, as mentioned in the article the meltdown is planned for Oct 2018 and it was not supposed to occur on Oct 2017.

Munna, they are talking about October 2018, not 2017

Pappu.. .it's October 2018 plans and not 2017..Read again!

You should name the Minister and the officials and companies involved or not write. This is not good journalism especially coming from you


Those who cannot deduce should avoid trying to read and understand such articles. They should stick to the entertainment sections!

Jai chidu ji... sir please become fm and save us from these chai and pakodawalas..sir what r u gonna do with thousands of crores..please help nation to b a superpower ...u got great brain juz tat u used for ur self.ab ki baari desh ki.

I agree fully with Nalapath.. this unworthy former minister is foreign educated crook who is capable of going to any extent for power and money, even selling the country...he and his family has properties in all continents..he did nothing for his own State and his parliament constituency...PM should see that he pays penalty for all his misdemeanors of the past..

Yes! This minister would sell not only his mother but even his lungi for power and money.

Perfectly correct. Chidambaram will sell country to be in power.After all entire Congress under Sonia Gandhi looted and paid dearly is well known and will resort to any means to capture power again,so people should be vigilant. Modi working for 18 hours, is NOT to handover country to looters again.

I agree with you, there is a possibility of this news is planted news by BJP as fear of retails investor surely vote against BJP in next Loksabha election.

Vote against BJP and for whom? Pappu? Lalu? Maya? Mamata? Only a truly TRAITOROUS citizen would hand over the reins of his country into the hands of known anti-nationals! There maybe many like you but there are far more of us to keep thieves crooks traitors and FOREIGN agents out of power!

pl. see what is going on in kashmir, every day our solders died, we heard only news of befitting response, how long it will continue, why government not taken any effective action against pakistan, on sunday in kashmir deputy mufti of kashmir which taken salary from our tax contribution demanded partition of our country for muslim, why till today government of india and kashmir not taken any action against him, BJP only use nationalism for taking vote in election. you absolutely right that we not have other option, this is bed luck from past 500 - 1000 year that we don't have truly nationalism raja, maharaja or political party till today, all are playing for only power including BJP. (previously i and my family is strong voters of this party). can you give logic for - for earning Rs. 20000 crores from LTCG, BJP fm wiped out Rs. 4.6 lakhs crores of puplic in just one day, today also market is in blood bath, please don't ignore fact that common men also in market from last few months or in one or two year through mutual fund by investing it hard earn money in share market.

Who can say it is to increase the reader of Sunday guardian?

Who can say it is to increase the reader of Sunday guardian?

Why you are writing such useless article and misguiding poor persons. World over all markets are always maupulated. This is well known fact to all share market investor. What about log term calital gain tax? Why security transaction is not removed? This budget is hopeless.

Agreed that the Congress can do all this. But what in God's name are these people doing? If this minister had done so much of gapla, why didnt this government arrest him. Very clearly this Govt is not in control, they are losing it. They have no guts to act against CON crooks, but only want to harasss honest tax payers. Disaster looms ahead and we should not offer any sympathy, these guys deserve it.

I already knew this..... You are 100 percent right.. Even our PM and FM is playing in to the hands of suchBeaurocrats who are close allies of Chiddu..

Absolutely right. It has to be that bespectacled politician from TN wearing the mundu who will do this. I just hope Swamy doesn't let this happen.

Everything points to the biggest crook in last 20 years P Chidambaram

The govt is incapable of handling country...We all purchased juicer which didn't work after 2 days and we realized it the next day... But we had a contract with the seller not to change or replace faulty machine for next 5 years.. The article is just a myth to cover govt inaction

The author, lives in fantasy land. He seems to have forgotten who is on the opposite side. If stock markets decided elections, nifty would be 20000 by October. Tell him to write novels not newapapers

These Cabals have effectively MANAGED the PM and FM and already played their first step successfully by proposing LTCG highly risky asset class... This was well planned strategy to prepare a ground for seeding the Meltdown... This decision by the government proves dumbest FM of the History and overconfident PM who blindly relies on panderer Beaurocrats... And not using the Head of their own LTCG will bring the Sensex back to its 2014 levels This step of introducing LTCG on equity planned by Beaurocrats has prepared the ground for tarnishing the image of present government by washing away all the gains made by the Index in 4 years in a jiffy

Sad Mr Modi will not read and act on the articles or the comments of his and nations we'll wishers.He only talks but someone should tell him that he should sometimes read too.History may pardon Dr Singh but not Mr Modi.

What would your vast knowledge and experience have to say if the market recovers and returns back to it's upward trejectory? Would you then declare yourself to be the dumbest individual comparable to PAPPU? Ha ha ha!

This time also such hatching may be done by chidambaram feeded shekhar gupta led indian express as was done in the case of fake army coup repoerted by ritu sarin and samantha who delivered the fake stories on there demand for fear mongering and fooling the nation.

I understand what M.D.Nalpat showed to us in this post.He has identified the Former FM P.Chidambaram but didn't said anything on his accomplice in the conspiracy to remove MODI by hook and crook.I name him HE is present FM Arun Jaitely who is conniving colluding with P.Chidambaram to remove Modi from PM post in 2019.It is a great conspiracy from 2014 when he was made FM and he was in touch with P.C.always with support from his Lutyens Media Club.Have any body notice any Lutyens Media criticized AJ in last 4 years.Why none ever criticized him?But MODI is blind by his love affection and trust on a Conspirators. He never wanted to book SG RG for loot plunder in their term as PM in 2004-2014 period.He washed their clothes white by demonetization.MODI is being blackmailed by him to keep the portfolio of Finance Ministry under him.Now MODI is isolated and alone in the game.He has no friends left in the war against PC.Hope Swamy is made as FM soon so that he will take most strong and stricta ction on all cabals.

Even fantasies have some sensible basis, yours is a Disney movie devoid of reality or sense one for the cartoon crowd or the PAPPU SENA!

Sir, you imagination is lacking a lot; you couldn't connect AJ to Masood Azhar, Mao Zedong, Richard Nixon, Sonia Gandhi, Rahul Gandhi, Kapil Sibal, Sitaram ji, Prakash ji, et al, et al.

The author should stick to fantasy. Few points 1 Why not name the minister. 2. Is present government inefficient to track such thing and take action. 3 Why anything negative is still blamed on opposition. I also want to reply to them who questions about our progress in last 70 years. - A tea seller can become our prime minister and we all are proud of him. This is what we have achieved in our democracy


I fully agree with the views expressed.


I bet you also believe the Brits gifted us the railways and Nehru is Cha Cha and north Indians are invading Aryans and South Indians are Dravidian Aborigines and Rahul is the best candidate for PM, and Sonia married for love? Ha ha ha!


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