After a gap of over a year, I decided to accept CNBC's offer to be a speaker at an investor camp in Agra. The city of the Taj and the opportunity it offered to visit the beautiful monument played no small a part in my decision. Another reason for accepting was the opportunity it provides to interact with retail investors.
Once again, I was struck by the picture that most retail investors have of the stock markets. It seems, most think of the markets as the playground of manipulators - with no "logic" applying to it. This, despite the fact that the Indian equity markets are one of the best regulated and technologically most advanced in the world. The preponderant impression is that since the investor has lost money (or atleast failed to make money despite a huge rally), the problem must lie with the markets since the investor cannot be irrational. In other words, I'm ok. you're not.
As any market participant knows, the markets are far from perfect. There are sharks, and manipulators operating in the market. However, these form the minority. Further, the market operates with a logic of its own, that investors can understand and make money off. That requires effort and patience, and like every other art, a lot of practice - something most investors are loathe to do. Instead, it is much easier to blame the system.
An analogy comes to mind. Most non-swimmers would not jump into a rapidly flowing river without help or proper equipment. They would also not blame the tides, rapids, or whirlpools that they may encounter along the way on malicious forces. Instead, they would blame themselves for not making the effort to learn how to negotiate these. To me, the markets are like the river. You either figure out how to swim, take a boat, or use the bridge. You don't jump in if you cannot swim. I wish schools would make personal financial management courses mandatory early in life.
Till then, we as market participants, are doomed to be looked upon with suspicion and opprobrium albeit tinged with a bit of envy
Sunday, June 14, 2009
Building Perspective among journalists
India boasts perhaps the largest number of news channels and newspapers in the world. However, for all that, the news that is delivered is surprisingly uni dimensional and lacking in perspective. Most journalists think that being shrill replaces being analytic.
A case in point is the recent coverage of the "swine flu". A popular english news channel would have you believe that India is "battling" the Pandemic, and not too successfully - as all of 22 cases have been reported across India. Without advocating a lackadaisical attitude on the part of the medical authorities, one wonders whether this is headline making news at prime time. To put it in perspective, India has 20% of the world's 37 million estimated blind - and another study suggests that 15% are curable - this makes it a case of 1 million untreated patients. People suffering from Malaria and Tuberculosis make up similar orders of magnitude. When is the last you have witnessed a mention, much less a discussion on these diseases. I guess this too is a function of the prevailing "fashion". Perhaps one of the negatives of having a oh-so-young population. Serious issues are passe, sensational is in
A case in point is the recent coverage of the "swine flu". A popular english news channel would have you believe that India is "battling" the Pandemic, and not too successfully - as all of 22 cases have been reported across India. Without advocating a lackadaisical attitude on the part of the medical authorities, one wonders whether this is headline making news at prime time. To put it in perspective, India has 20% of the world's 37 million estimated blind - and another study suggests that 15% are curable - this makes it a case of 1 million untreated patients. People suffering from Malaria and Tuberculosis make up similar orders of magnitude. When is the last you have witnessed a mention, much less a discussion on these diseases. I guess this too is a function of the prevailing "fashion". Perhaps one of the negatives of having a oh-so-young population. Serious issues are passe, sensational is in
Outsourcing India's interest to the USA
The Prime Minister wants to re-start the Indo-Pak dialogue in anticipation of Washington's advise to do so. Since the Mumbai attacks, the government has been claiming success of India's diplomatic initiatives to exert international pressure on Pakistan to cease and desist from its support to jihadists and other terrorists in India. The reality is exactly the reverse. India seems to have lost the plot completely.
M J Akbar's article in the Times describes the problem of US perception and its own imperatives. As outlined by Brahma Chellaney , Pakistan attempts to portray itself as a failing state and extract international ransom has been hugely successful. By falling in line with the US demands, India continues to do itself a disfavour. This weakness is now apparent in the economic policy sphere as well - where USA is able to "persuade" Indian companies to toe its line in international markets.
If only we had a leadership that REALLY had a vision for a strong Indian state.
M J Akbar's article in the Times describes the problem of US perception and its own imperatives. As outlined by Brahma Chellaney , Pakistan attempts to portray itself as a failing state and extract international ransom has been hugely successful. By falling in line with the US demands, India continues to do itself a disfavour. This weakness is now apparent in the economic policy sphere as well - where USA is able to "persuade" Indian companies to toe its line in international markets.
If only we had a leadership that REALLY had a vision for a strong Indian state.
Politics as a profession
Many years ago, a friend in school remarked, at the end of a heated discussion on the future of Indian democracy, that no youngster in India from a "good" background aspired to the position of Prime Minister - when planning his/her career. The implication was that Indian democracy would remain the playground of the opportunists.
I was reminded of this conversation from my own childhood while watching an interview on NDTV recently.The anchor was interviewing a topper of one of the board exams. When asked about what he aspired to do in his career, the young boy remarked that he desired to enter politics as it was a way of serving society. If this indeed reflects the desire of more of India's educated youth, we can only be more sanguine of the future of Indian democracy.
I was reminded of this conversation from my own childhood while watching an interview on NDTV recently.The anchor was interviewing a topper of one of the board exams. When asked about what he aspired to do in his career, the young boy remarked that he desired to enter politics as it was a way of serving society. If this indeed reflects the desire of more of India's educated youth, we can only be more sanguine of the future of Indian democracy.
Sunday, May 17, 2009
India’s relations with US – Missing the Left
The Left front is no longer a force to reckon within the Indian Parliament for the next five years at the least. After supporting the previous UPA government for four and a half years, the Left and Congress fell out over relations with the US – and India started the process of getting closer to the USA.
I have argued elsewhere that aligning with the US was a mistake that India was making. That India should either have done it sixty years ago, or failing that, stayed in the shadows for another decade, when a declining economic clout of the USA and a rising graph for India would enable India to negotiate from a position of strength. Some early signs of the differences that exist in the world views of the USA and India are now visible.
While the PM was expressing his love for George Bush, or requesting the autograph of the new president, the USA was, rhetoric to the contrary notwithstanding, busy downgrading its relations with India. One of the best articulation of this is in the speech that Robert Blackwill, the former US ambassador to India delivered on May 5, 2009 at the CII conference at New Delhi
The Indian viewpoint is well articulated by Brahma Chellany
In International relationships, what matters is not what is said, but what is done. And what has been done by the US is to relegate India to the third hyphen in the troika of Afghanistan-Pakistan-India. That the government of the day seems to have managed to sell this to the Indian public as a winner of a relationship is itself an acknowledgement of the Congress’s ability at Spin – the opposition has a lot to learn in this regard
I have argued elsewhere that aligning with the US was a mistake that India was making. That India should either have done it sixty years ago, or failing that, stayed in the shadows for another decade, when a declining economic clout of the USA and a rising graph for India would enable India to negotiate from a position of strength. Some early signs of the differences that exist in the world views of the USA and India are now visible.
While the PM was expressing his love for George Bush, or requesting the autograph of the new president, the USA was, rhetoric to the contrary notwithstanding, busy downgrading its relations with India. One of the best articulation of this is in the speech that Robert Blackwill, the former US ambassador to India delivered on May 5, 2009 at the CII conference at New Delhi
The Indian viewpoint is well articulated by Brahma Chellany
In International relationships, what matters is not what is said, but what is done. And what has been done by the US is to relegate India to the third hyphen in the troika of Afghanistan-Pakistan-India. That the government of the day seems to have managed to sell this to the Indian public as a winner of a relationship is itself an acknowledgement of the Congress’s ability at Spin – the opposition has a lot to learn in this regard
The dance of democracy – the next chapter begins
The greatest election mankind has ever witnessed has come to an end. The administrative machinery has performed a great job in collecting and delivering the verdict. That India can deliver a vote count of more than 300mn votes with a high degree of accuracy and within five hours or so of the start of counting (the trends were clear by then) is something we can all be proud off – the election commission can take a bow.
Now, it is time for analysis. In many senses, this election marks a turning point in the fortunes of our country. Though Dr. M Singh will start as the PM, it is highly likely that he will not end the five years as one. Rahul Gandhi is more than likely to take over somewhere along the way. This election will then mark the ascent to power of the first PM of India who has been born in Independent India. One of the advantages this may have is that we will be able to approach relations with our neighbours with none of the color that leaders of the earlier generation did – since there is no emotion involved.
A disquieting factor however is the likely continuing decrease in the quality of political debate. It may be postulated that politicians of post independent India maintained some (often very high) level of personal regard for those in opposing ideological camps. Even within the same political parties, differences of opinion were sorted out with some civility. Witness the case of Jawaharlal Nehru and Sardar Patel. Often the two stalwarts would not see eye to eye, but managed to work within the boundaries of decency. Presumably, this was in part because of the shared ideal of building an independent India, and the realization that others had, in their own ways, contributed too. I see this now disappearing – though surprisingly, this is visible in the quality of the PM’s response to the opposition campaign against him and his rule.
The quality of the political debate will also suffer because of the absence of the left front as a force in Parliament. Whether you agree with them or not, the Left did throw up a view point that was based on a certain ideology, and stuck with it. Those who revile them would do well to consider the effects of dilution of government ownership in banks – in the context of the global banking crisis, and the effective nationalization of most banks around the world. The stock market (not known for being very sagacious or far-sighted,) will, of course, celebrate the dilution of ownership and control that is now inevitable. This is only one example.
The Congress has much to celebrate. The Family is now firmly back, with a new heir apparent – who has bought in a sense of self-confidence to the party. While one could differ on the causes of the outcome, there is no taking away from the fact that Rahul Gandhi’s gamble of going it alone in the state of UP will be considered a success. With this result, the Congress ruling Family is back to its winning ways. Expect to see the party gain in strength from here on for some years.
Now, it is time for analysis. In many senses, this election marks a turning point in the fortunes of our country. Though Dr. M Singh will start as the PM, it is highly likely that he will not end the five years as one. Rahul Gandhi is more than likely to take over somewhere along the way. This election will then mark the ascent to power of the first PM of India who has been born in Independent India. One of the advantages this may have is that we will be able to approach relations with our neighbours with none of the color that leaders of the earlier generation did – since there is no emotion involved.
A disquieting factor however is the likely continuing decrease in the quality of political debate. It may be postulated that politicians of post independent India maintained some (often very high) level of personal regard for those in opposing ideological camps. Even within the same political parties, differences of opinion were sorted out with some civility. Witness the case of Jawaharlal Nehru and Sardar Patel. Often the two stalwarts would not see eye to eye, but managed to work within the boundaries of decency. Presumably, this was in part because of the shared ideal of building an independent India, and the realization that others had, in their own ways, contributed too. I see this now disappearing – though surprisingly, this is visible in the quality of the PM’s response to the opposition campaign against him and his rule.
The quality of the political debate will also suffer because of the absence of the left front as a force in Parliament. Whether you agree with them or not, the Left did throw up a view point that was based on a certain ideology, and stuck with it. Those who revile them would do well to consider the effects of dilution of government ownership in banks – in the context of the global banking crisis, and the effective nationalization of most banks around the world. The stock market (not known for being very sagacious or far-sighted,) will, of course, celebrate the dilution of ownership and control that is now inevitable. This is only one example.
The Congress has much to celebrate. The Family is now firmly back, with a new heir apparent – who has bought in a sense of self-confidence to the party. While one could differ on the causes of the outcome, there is no taking away from the fact that Rahul Gandhi’s gamble of going it alone in the state of UP will be considered a success. With this result, the Congress ruling Family is back to its winning ways. Expect to see the party gain in strength from here on for some years.
Friday, May 1, 2009
A LESSON IN 'SPIN'
A story doing the rounds on the internet goes:
Judy Wallman, a professional genealogical researcher, discovered that Hillary Clinton's great-great uncle, Remus Rodham, was hanged for horse stealing and train robbery in Montana in 1889.
The only known photograph of Remus shows him standing on the gallows. On the back of the picture is this inscription: 'Remus Rodham; horse thief, sent to Montana Territorial Prison 1885, escaped 1887, robbed the Montana Flyer six times. Caught by Pinkerton detectives, convicted and hanged in 1889.'
Judy e-mailed Hillary Clinton for information about her great-great uncle. Hillary's staff sent back the following biographical sketch: 'Remus Rodham was a famous cowboy in the Montana Territory. His business empire grew to include acquisition of valuable equestrian assets and intimate dealings with the Montana railroad. Beginning in 1883, he devoted several years of his life to government service, finally taking leave to resume his dealings with the railroad. In 1887, he was a key player in a vital investigation run by the renowned Pinkerton Detective Agency. In 1889, Remus passed away during an important civic function held in his honor when the platform upon which he was standing collapsed.'
The story is false. But, it does serve to illustrate the role of spin doctors – something the Indian political parties desperately need. Most key parties in India are struggling to re-invent themselves, and in the process, creating a web of lies to entice new, first time, voters. Mid month will reveal who succeeds. Till then, we have to remember Churchill’s definition of a parliamentary candidate “He is asked to stand, he wants to sit, he is expected to lie”
Judy Wallman, a professional genealogical researcher, discovered that Hillary Clinton's great-great uncle, Remus Rodham, was hanged for horse stealing and train robbery in Montana in 1889.
The only known photograph of Remus shows him standing on the gallows. On the back of the picture is this inscription: 'Remus Rodham; horse thief, sent to Montana Territorial Prison 1885, escaped 1887, robbed the Montana Flyer six times. Caught by Pinkerton detectives, convicted and hanged in 1889.'
Judy e-mailed Hillary Clinton for information about her great-great uncle. Hillary's staff sent back the following biographical sketch: 'Remus Rodham was a famous cowboy in the Montana Territory. His business empire grew to include acquisition of valuable equestrian assets and intimate dealings with the Montana railroad. Beginning in 1883, he devoted several years of his life to government service, finally taking leave to resume his dealings with the railroad. In 1887, he was a key player in a vital investigation run by the renowned Pinkerton Detective Agency. In 1889, Remus passed away during an important civic function held in his honor when the platform upon which he was standing collapsed.'
The story is false. But, it does serve to illustrate the role of spin doctors – something the Indian political parties desperately need. Most key parties in India are struggling to re-invent themselves, and in the process, creating a web of lies to entice new, first time, voters. Mid month will reveal who succeeds. Till then, we have to remember Churchill’s definition of a parliamentary candidate “He is asked to stand, he wants to sit, he is expected to lie”
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