So her get rich quick schemes have included collecting money for shady chit funds, shady companies, etc. Obviously she was a Talk Asia agent also.

Her ambition did not stop at these get rich quick schemes. She has pushed her daughter into the CA course. The poor kid did not enroll for Bcom – hoping to finish her CA. Sadly 4 years into the course she has not cleared the stage 1 – she is academically just inadequate to do CA.

I know her just casually – having spoken to her about the CA degree for her daughter, but she has not asked me for money for any of her schemes. Her ‘clients’ include a few General Managers, managers, clerks, government servants, teachers, NEWSPAPER VENDOR, MILK VENDOR, CABLE TV VENDOR,….and the amounts have varied from Rs. 25,000 to Rs. 200,000.

When the newspaper vendor told me (God knows why he choose me)..I asked him ‘What does she say?’ – He said ‘You gave the money to THAT company, ASK THEM…’ or ‘Did you give the cheque in my name or the name of THAT COMPANY…’ LOL.

She is a very shrewd, but dumb woman – last I heard one broking firm had enrolled her for ‘training’ in equity, commodities and forex markets….and she is in the process of becoming their sub-broker…

Do I need to add she is an insurance agent also?

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And our army cannot get its General’s date of birth right…

In Kashmir they ‘need’ to be there to keep it normal – does it sound like our ‘Long live Backward Classes’ slogan….One thinks that reservation are meant for up lifting the down trodden, right?

but this is how BSF looks after our borders…a country which was outraged (of course it was a publicity stunt by all the paid participants) when ‘Mr. Khan’ was made to wait for an extra 10 minutes in the American airport….

http://kafila.org/2012/01/20/the-bsf-as-pornographerbravehearts-with-bluetooth/

if you feel outraged please ask MM Singh to at least apologise. The first step for a fall is arrogance….- and we have been arrogant enough too long. Of course our PC is not arrogant – he is far beyond that.

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Remember this advice sometime in 2007….and as usual I smiled it away. In fact the EDITOR of a financial mag told me ‘Hey this fund is doing well in my portfolio…why is such a story being carried (somewhere else, thankfully!!). I said, ignore the advice.

2. “Hindustan Unilever has lost its pricing power. It is losing market share. There is no use in having a company with a fantastic brand recall – sell it”.

A friend’s Dad with about 100,000 shares was worried. I said, ignore the advice, change the channel. This was in 2008 or 2009 – not sure.

3. You can never make money in an industry where the government controls the input price and selling price. Avoid Fertilisers – the FII will NEVER buy it, so it cannot go up AT ALL. Very, very famous TV loving investor/broker/fund manager.

Look at the performance of Coromandel International.

4. Investing and waiting for the market to improve / get good returns is history. You should trade in and out of the market.

Obviously given by a MD (broker of a big brand)…

Please ignore. Most market intermediaries are rewarded on action. You reward YOURSELF only if there is growth AND the charges are less.

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How much exactly does staying in an old age home cost? Frankly I have not done enough research to do such a post, but here is some rudimentary info. You will need to do more research yourself…

For a typical Tam Brahm – who is looking for veg food and a very simple lifestyle, I found the prices ranged from Rs. 10,000 a month to about Rs. 15,000 a month. I am not imputing any cost to the deposit which is to be made. The deposit varied from Rs. 50k per couple to Rs. 15 lakhs per couple. These costs do not include medical expenses or any other type of special expenses. SIMPLE DAY TO DAY LIVING EXPENSES including laundry, food, electricity…THAT IS ALL.

Assuming it costs about Rs. 15,000 per head per month TODAY…it is likely to cost the following:

2011     Rs. 15,000 p.m.  x 12 = Rs. 180,000

2020    Rs. 30,000 p.m. x 12 = Rs. 360,000

2031     Rs. 60,000  x 12              Rs. 720,000

So how much money will you need to retire to a home like this?

Well just for the food and shelter you will need Rs. 360,000*30 years = Rs 1.8 crores if you retire in 2020. Apart from this you need to provide for your other expenses like telephone, travel, clothes, festivals and of course medical expenses.

Now Rs. 1.8 crores invested in a bank should give you about 5-6% p.a. returns POST TAX..assuming you do not do anything stupid like investing in a venture fund or an infra fund without any understanding of infra or venture! Straight simple income fund, bank fd, senior citizen fund, index fund (inflation protection)…kind of portfolio. Rs. 9 L will be the income in the first year..and you will REINVEST Rs. 640,000 – all this reinvested amount will help you tackle with inflation.

Hopefully I will do more posts on old age homes and its expenses….I NEED IT, not sure whether you do. Yes I do have a lovely daughter – but have a heart, why should she put up with a cranky old man with stupid ideas….OMG my heart goes out for her already!!!

By the way, did I hear you saying you have a spouse and you are retiring in 2031?

Well the amount is 720,000 * 2 *30 = 4,32,00,000…..is the amount…

Happy 2012!

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This is not easy to think or accept. People who continued their SIPs would have also done badly – no doubt about that. Your opening portfolio (Jan 2011) would have been down, and so would have the SIP figure.

Obviously at this juncture we can ALL see the negatives and we all KNOW that the market will go down, do we not!!??. (Hey there are some readers who do not get the sarcasm, sorry). Well when on TV and other media you look at the ‘experts’ – their views are worth hearing…

-Markets will go down to 12000 (no clue why there is such a consensus for this number!) and the more optimistic ones are predicting 18000. Of course the very hardy, never say die guys predict 20,000.

Frankly I do not know what will happen.

However a bad year is rarely followed by a worse year (yes it has happened in the past, but I am taking a calculated call!)..which means a NEGATIVE 25% will not be followed by a negative year. So assuming that the index’s starting point is 15,500 for Jan 2012 (I am writing this on 2nd Jan at 9.30am and this is the current sensex), I think seeing the sensex at 19500 is not impossible. This means that the current year’s return would be about 25% – just wiping out the 2011 losses.

Will the Re – US $ be at 60? not sure. However if many NRIs start keeping their money in India (remember the rates of Nri deposits have improved) and the software exports do really well, we could see the exchange rate at 52 instead of 62!

Not guessing the sensex, but just punting on the fact that the IMMEDIATE past has NO BEARING on the IMMEDIATE future. Simple, is it not?

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How different are other countries? Well not very different. Governments have made impossible to meet promises – US, UK, France – all are guilty of similar mistakes if not greater mistakes, and one day all the problems will come home.

What about India? Well we have one major mistake which will kill one of the future governments – indexed pension for the government servants. When the government is told of the danger they do not react fast enough. For example when the government did a calculation and realised the enormity of the ‘defined benefit’ indexed pension, they quickly converted new joinees (a few years ago) to the NPS. However the army has not yet agreed to defined contribution.

When committees suggest downsizing of the government the government does not listen to it.

Currently if you are blaming the Euro crisis, the Chinese Realty collapse, or the Americans for the dollar being at Rs. 55, please cut out the crap. Look at the way the UPA government is allowing / helping legitimate looting of the exchequer. The politician and the bureaucrat combine is causing a lot of harm.

Just look at the numbers! NREGA, Telecom scam (if Raja was the only guy who took home so much of money, I would be surprised), Fertiliser subsidy, petroleum subsidy, mess in the coal mining, inability to handle Telangana,….it is a mess.

If people are pulling their money out, do you blame them?

The foreign markets look interesting – and if you are not worried about the $-Re rate, even the debt market looks good in the short run of 12-14 months….

The fiscal part of the economy is poor – so please reduce your expectations on growth!

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Let us look at China. If I had my money there, I would be worried and pulling out. The government has too much money and it does not let the citizens spend – that is the way to keep inflation down. The avg Chinese will end up buying more gold and real estate. Real Estate is cracking and gold may also struggle.

India: It has a government which spends with 4 hands. Clearly RBI has no answer to inflation and the UPA is busy making money. No clue whether it is worth voting NDA back to power – but we may have to do that just to get rid of the Congress. Most of the reforms happened under Narasimha Rao and Vajpayee – our current PM is …well no comments. No control on inflation, no control on deficit (55 billion US $ soon). No reforms, growth in mid single digits, and the Rupee heading to 55 shortly…NO way how an American will be in a hurry to invest. We thought if we got US $ 30 billion once, we will get it every year.

If Subramanyam Swamy can get some order from the Supreme Court – the government will have to go. Kaput.

So India is out.

Brazil, Russia ….hmm no comments..

So there will be ‘flight to safety’ – so the American bluechips will get more money …..all IMHO….

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Experience has taught me one thing. You cannot draw conclusions based on one or two students or colleagues. To draw a conclusion, you need a huge, huge database across genders, medium of schooling, communities, geographies..and with that data you MAY be able to draw some conclusions….

Once in a MBA school (long time ago when I thought teaching was a noble profession) one HoD said – these kids are from the Hindi belt, they know the subject, but do not know English, hence they are not getting jobs.

I asked him what he was doing to rectify the situation. He said “Oh we are planning to give them Communication skills Workshop. Here we will teach them English, and some techniques on presentation, etc..”

I said let us pick up a 2-3 students and check out what is the problem (luckily he agreed – teachers are the worst when it comes to listening – ask me I am one!!!).

I asked 3 students to speak on ‘Why invest in equities’ – and they struggled speaking in English. I ‘saw’ a ‘I told you’ on the HoD’s face. I said “Now speak in Hindi…on the same subject”.

FUNNILY, they still struggled.

I said speak in English about India’s performance in the 2003 world cup – THEY ALL COULD SPEAK IN ENGLISH (reasonable English, yes there sere mistakes). Then I asked them to speak in Hindi, they were fluent.

I told the HoD – they needed to understand the subject better, far far better than what they currently do. Their syllabus was too long and big. They COULD NOT do justice to the SUBJECT – not enough time, so they choose to do selective studying (this serves the exam purpose)…and in real life flounder.

Same thing is happening in India about financial education. Many people know – spend less than you earn, create an emergency fund, start early, compounding, do your SIP – these have been written about ad nauseum. I think we need some basic behavioural finance classes! Identifying the problem is more important – preaching is not working!

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It may also be some kind of a protection for people investing only in India. You can look at condos at US $ 50,000 – at such prices the real estate agent in Mumbai and Delhi will not even look at you. Given Indian prices and terrible rental yields, it may be worthwhile to invest in US and UK.

Most of us are today sure that it is India and China are the only growth stories and all US and Europe is doomed. Please understand it takes a couple of world wars to dethrone those in power. US and Europe will not give up the domination very easily – this means the real estate investment cannot be too bad.

I am neither saying ‘buy’ or ‘sell’ – just read this article by Deepa Venkatraghvan – in Economic Times – and take your own decision..Please remember US is an extremely ‘agent’ oriented country – so while taking a buying decision remember Estate management fee, taxes, currency risk, brokerage and commissions while taking a decision…and as usual have at least ONE BUSINESS CYCLE – 7 years view…shorter views could kill you or maim you at the least.

http://economictimes.indiatimes.com/news/nri/nri-investments/us-real-estate-smart-diversification-option-for-hnis/articleshow/10728864.cms?curpg=2

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Now I have 2 questions to ask all you readers:

1. Which are the blogs that I should cover? (I do not think I will cover more than 10 of them)

2. What are the criteria based on which I should be JUDGING them?

will do the exercise …WITHOUT TALKING to the bloggers themselves – many of them I know.

I also know that an exercise like this will make more ENEMIES than FRIENDS…..but still…lets have fun

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