He decided to cut the head – to save the expenses!

When it comes to philosophy or spiritual thoughts too – many people say ‘I am spiritual, not religious’ – sounds like a joke, really. I know ‘bhakts’ of Shankaracharya (of Kanchi) who would go there in grand silks (he was always against silkworms being destroyed), seeking his blessings for a wedding, and then asking for dowry. Selective acceptance of a guru’s advise is I think absolutely stupid.

This happens to many financial advisers too. Clients use half the advise and then make a mess of the what the adviser has told them. When I say do not take unit linked insurance. I am ALSO SCREAMING ‘take the cheapest term insurance that you can buy for your age, for a period you want, for an amount that is suitable for you’. If you just say ‘Subra says do not take insurance’ – bad luck to your nominee.

Sometimes it is easy to interpret what the adviser has told them. Sometimes it is not. I keep screaming that real estate is not a good investment over a long period of time (say 30 years). However it is true IF AND ONLY IF you keep the money in a good well performing equity portfolio (direct or mutual fund). If the money is lying in a bank fixed deposit – yuck you would have been far, far better off with buying the house.

There are tons of such examples. It is necessary to understand the advise in full. Remember I too have ULIPs – but I bought it when it was cheap, and I did reverse engineering to find out how the cost will hit me over long periods of time. However I am still planning to surrender it, because of fund manager issues….:-)

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If I were Bill Gross, I would have done the same thing….When Bill Gross (the bond Guru?) took a stand that having a bull position in US Governement securities was not a sensible thing to do….I nodded..

He had a big portfolio of government bonds – about 250 billion US $! It is not easy to liquidate such a big portfolio, run a total bond fund and not hurt yourself! So he had some put options, and some more derivatives which helped him bring down the risk against the US G Sec falling.

However his current year performance has not been good and he is ranked above 500 in a field of 589 fund managers.

Of course he has admitted his mistake – and may have even reduced his puts.

This is again proof that you are better off in an index bond fund (no it does not exist in India) – preferably an ETF so that you play around with only the interest rate calls. You can pump as much money as you want into such a fund, and sleep tight without worrying about interest rate movements, or even the rating ups and downs.

When will we have a bond index fund? I do not know.

Our dynamic bond funds are not doing too well, and we do not have an index fund……what to do??

Well invest in a bond fund with a low duration like the Templeton fund….or put money in a dynamic bond fund and hope he does well.

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Most Indians (sorry this may be homogenising all other religions!) know this prayer. Today is Teachers’ day. It is one profession for whom my fascination will never end. I recently met a Pediatrician with 35 years ex experience – she teaches for an amount of fees that is less than the cost of petrol from her house to the college. Why people teach even if not paid well could be to ‘learn’ from their students, but after 35 years of experience?

 Well that is the ‘love’ of teaching, is it not? Here is an amazing story.

 A ‘white’ journalist from Europe was visiting Jagadguru Shankaracharya of Kanchi. The journalist asked him saying “you are a guru to a handful of south indians – that to largely of a particular caste, how can you call yourself a ‘jagad guru’ \ teacher to the world. Shankaracharya just smiled and said “Your interpretation of the word is different from mine. When I am called Jagadguru, I mean Iam learning from the Jagad. Every person, tree, animal, incident, book to me is a learning opportunity so I am a Jagadguru – the Jagad is my guru. It is a fantastic learning for anybody.

The other example I like to tell my students is to say  – Look at the entrance of any temple – it has an elephant and a lion. Elephant stands for prosperity and the lion for strength. Wealth and strength are normally the causes of a person’s ego. When you go into a temple, the symbols remind you to leave the ego outside. It is exactly how you should enter a classroom – there is always something to learn. If you go in thinking ‘I know more than the trainer / teacher, you miss out on the learning opportunities. It is a complete waste of time, you might as well go watch a movie without disturbing others in the class.

Hey thankyou all my teachers, students, professors, trainers, customers, readers, colleagues, ….I am what I am because of you. If there is something lacking in me -it is my ego preventing me from correcting it.

So hey God give me the strength to over come it. Happy teachers day to all of you. Most of us have been created by our teachers.

Mata, Pita, Guru, Daivam!

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One amazing Guru story is attributed to Jagadguru Shankaracharya of Kanchi.

One journalist (do not remember his name, it is a White Man whose name is mentioned in “Daivathin Kural” (translated it means God’s Voice) asked Sankaracharya – you are a ‘Guru’ for a bunch of brahmins – that too largely from south India, how can you call yourself    ‘Jagad – Guru’? (World – Guru)

To which Sankaracharya replied ‘Your interpretation of Jagadguru is different from my interpretation of Jagad Guru’ – he went on to explain and said “You interpret Jagadguru as I am the guru of the Jagad (World). That is not true. What I meant by Jagad Guru is ‘the Jagad is my Guru’ – I learn from every creature I meet.

This is an amazing statement. Only when you accept that learning can (and does) happen from everybody that you can grow in life….keep the humility in place and keep learning.

My respects to all my teachers, to all the banks, mutual funds, life insurance companies, brokerage houses and people attending all my seminars, FAAIDA members, Chartered Accountants, members of stock exchanges, etc. who have let me learn by letting me teach them. Thanks Guys..just tooo many people to be thanked individually.

On a Guru Poornima my salutations to all the people from whom I have learnt something. If you look it as a learning opportunity, all client meetings are also excellent opportunities to learn, so thanks to all the people whom I have met with a sales man hat also…!

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I heard one such story come back to me, and was amused. In the year 2001-2 there was a sales person (just about starting his life insurance career) sold a life insurance policy of Rs. 5 crores sum assured i.e. to say if the policy holder died during the tenure of the policy, the family would get paid Rs. 5 crores – as a term insurance. This was considered to be a really big policy sale and the whole organisation was reasonably excited. Then somebody must have exaggerated this and instead of a ‘pure risk’ plan as it was now called an endowment plan – which meant higher premium. Then people started tracking how much money this manager was making, etc. and in 2008 – I heard the story as a Rs. 5 crore premium in an unit linked plan! It was told to me saying – ‘You know he sold a Rs. 5 crore premium- in those days! I was stunned, because this particular company did not have an unit linked product at that point in time, but was reminded about Chinese Whispers and the story of the ‘Zen guru and the snake’.

The story goes like this. Once upon a time a man chanced upon a 3 foot snake in his backyard, so he took a stick and killed it. His neighbhor was very impressed seeing this – and rushed to tell his wife. Of course, as is the human habit, he made it into a ‘big’ snake. His wife immediately told a group of her friends “my neighbhor killed a 10 feet snake this morning. To cut a long story short, by the end of 2 days there was a ‘felicitation’ for the hero who had killed a 30-feet snake. One zen guru had just come from the neighbhoring town and looked at the ‘hero’ a little suspiciously.

The ‘hero’ was squirming – his lie was of course his silence – so the Zen guru wanted to be sure about the felicitation. So he asked the hero. The hero kept quite.

So the zen Guru asked the hero’s son. The hero’s son looked at the father and then at the guru. The son then asked the guru another question: ‘Does a dead snake grow?’ The guru said- No, of course not.

To which the son said – I saw the snake when my father killed it. It was only 3 feet long. If it has grown after that, I would not know!

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Many people know that Hanuman is the Guru according to Hindu mythology (for the very philosophically minded, Hanuman caused the Atma (Sita) to join the Parmatma (Ram) – and that is the essence of Ramayana. So you need a Guru to teach you from the learnings of all the great people mentioned above. However is that enough?

Many people know – and many others may not know – that Parvati (Uma) is the Hindu Goddess of Wisdom. Wisdom is about doing what you know. This is the crucial link. Training, Learning is all fine – but for it to translate into action, you need wisdom. That is the crux.

So knowing that compounding creates wealth, living a simple life gives peace, tobacco free, alcohol free, stress free living gives peace is not enough.

Seeking a simple life, doing a simple sip (and sitting tight during turbulent times), having a term insurance, one credit card, IS ABOUT DOING all that you know. That will give you nirvana. So as Nike says, Just Do it.

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