Inclusive finance

One may wonder why India is insulated from Global tremors in the finance sector. Although the health of the equity market is contingent on foreign investments from Europe and America, the stability of Indian counterpart is commendable. It is time for our local investors to takeover from here. It is not easy. We need to involve our millions of population available, and turn them into our local investor. We need to guide them taking financial decisions and in no time we will become actually disparate from this meltdown.

I know this is not fool proof and sometimes it is necessary for foreign capital to come to India because of large volumes of investments. This factor is not in our hands. What lies with us is making more and more number of people aware of their financial decision. Making them aware of long term and short term financial planning and above all making them investors. The other point I wanted to state that is the need of medical insurance or any other insurance for that matter. Consider this : your servant’s father had a severe heart attack and requires an immediate treatment. DO you think that person will be able to bear this huge costs of Angiography or angioplasty. The debilitating health conditions in the vicinity of poverty line are anathema for these people. Helping them and making them aware to buy a health insurance will always help them.

It is unfair that the most populous sector is the least in generating revenues. Yup we’re talking about Agriculture. Our own national government can invent instruments (or discover as it is already present in US) like weather derivatives to enable the farmers hedge their dependence on rainfall for their agriculture produce in that year. So at least if there is regularity in rainfall, the framers won’t have to bear all the losses alone.

One more awareness program can be related to remittance programs. Money sent home by migrants constitutes the second largest financial inflow to many developing countries, exceeding international aid. Latest estimates vary between IFAD estimates of US$401 billion and the World Bank information from central banks at a more conservative US$250 billion for 2006 and these figures are increasing by almost 30% year on year. Remittances contribute to economic growth and to the livelihoods of needy people worldwide. Moreover, remittance transfers can also promote access to financial services for the sender and recipient, thereby increasing financial and social inclusion.

This is true that if we follow inclusive growth and make our fundamentals strong, like Warren buffet, ”If the stock dips after I have purchased it, I don’t worry so long as its fundamentals are good. “ . Hope I’ve made my point !!

Decision Making at a click away………. REALLY??

I recently read in Hindustan times about planning commission’s new plan of connecting bureaucrats by internet to enhance the decision making ability of the government. They claim that the existing one (RAX) which includes connectivity through hotline applications which connects only top personals is not competent enough.. Montek Singh Ahluvalia proudly said, “1.5 crore voice and visual interconnectivity will certainly put decision making in the fast track mode”
I truly agree to this plan that the connectivity amongst the bureaucrats will be enhanced and they will seriously be at a click away but I doubt on whether this will intensify the decision making ability.

One factor that the intellectuals suggesting these solutions do not take into account is the massive bureaucracy of India numbering over eight million altogether. Whatever the policy—people oriented or transnational subservient—there is no escaping this indispensable instrument of the state. Therefore, it is the gestalt of the bureaucracy which ought to form an integral part of any holistic strategy for meeting the challenges, both internal and external.

The mindset of the bureaucrat has to be studied in the perspective of the bureaucracy existing within a series of complex layers. The topmost layer is that of the bureaucratic ethos which itself exists within the layer of the governmental environment. This, however, is placed within the larger layer of the socio-economic-politico-cultural environment of India. Again, the individual bureaucrat is himself enclosed within yet another layer. The incredible complexity of these multiple layers of the bureaucrat’s make-up has to be analyzed and understood if an effective intervention for change is to be made.

In a society still polarized between Haves and Have-littles or Have-nots, where the crucial decisions regarding allocation of scarce resources are taken by the Haves and are implemented by a government machinery drawn largely from the same class, how can we expect that commitment to the Directive Principles of State Policy of a Welfare State will be a value close to the heart of the executive drawn from the exploiting class?

Once I searched about views of Mahatma Gandhi on bureaucracy and I found this: Rabindranath Tagore, whom Mahatma Gandhi regarded as the conscience of the nation, was unerring in his bald statement of why the administration had lost credibility:

“It is the mission of civilization to bring unity among people and establish peace and harmony. But in unfortunate India the social fabric is being rent into shreds by unseemly bursts of hooliganism daily growing in intensity right under the very aegis of ‘law and order’. In India so long as no personal injury is inflicted upon any member of the ruling race, this barbarism seems to be assured of perpetuity, making us ashamed to live under such an administration…That I consider a truly civilized administration which impartially serves the common interest of the people. It is the absence of this concept of impartial service in the cause of the general weal which is the evil plaguing our country.”
The tragedy is that Tagore was indicting the colonial administration, but his words hold brutally true for Indian administration fifty years later

The question remains unanswered: “Who will judge, who will punish the judges?” How will accountability of the three pillars of the Constitution be ensured? “Ethical”, “moral”, “spiritual” are words that can no longer be shied away from. After all, by no stretch of logic can the Directive Principles of State Policy be regarded as value-neutral, economic issues. The concerns are profoundly moral, ethical and spiritual.

Note: The views on these issues are entirely personal. I know that these Bureaucrats have worked to develop the administration of out nation and I haven't done anything significantly for the nation to challenge these people.

Tête-à-tête with Mr. Ten Headed

This is an imaginary interview of our dear Ravan (who is waiting for his effigy to BURN) when he met me depressed in one corner of Durga Pooja Pandal, near Lalbaug

Me: So sir, how come the king of rakhshasas seems so depressed on such a festive season.
Even you’re a devotee, why don’t you celebrate. Are you unhappy looking at people? Who are happy inspite of global meltdown?

Well, that a bit but also because of Wednesday, Dasshera when Ravan of Ramayana fame will get bad press once again.

Me: So you are contrarian when it comes to Ram v/s Ravan. Huh?

I think people are taking me in a bad light. Look at me. I’m a gr8 scholar of Vedas, ascetic disciple of Lord Shiva. Play Veena like Joe satriani. I defended my sister Suparnakha insult and I didn’t do anything wrong to Sita in retaliation. Why am I repository of all evils?

Me: Don’t despair yaar, look at other people. You have your temples in Andhra Pradesh, Karnataka where you are worshipped as the favorite disciple of Shiva.

Please don’t have malice for these people. And anyways the world is already in topsy turvy. Tell me anything, I would buy for you.

He thinks …… and thinks…… (He’s smart , not like JOEY TRIBBIANI)

I want RMBS

Me: (astonished) what is RMBS (wondering is some acronym of some new supermodel this devil wants to kidnap)

RMBS a.k.a residential mortgaged bank securities. You can buy ABS a.k.a Asset backed securities or CDOs a.k.a Collateralized debt obligations or some high graded bond of some Investment banks in America

Me : Why on earth do you want these stuffs??

Haven’t you been reading papers these American and European banks have run into turmoil due to these fancy investment instruments? People burn my effigies and light up Firecracker, Now play with these bombs. BLOODY LIVE BOMBS1

Me: Sorry, I won’t allow you to buy these Hazardous products. Tell me something else.

OK, in that case buy me a Bank.

Me: (Laughs) you think I’m made of money? What will you do with a bank……Have you ever worked with any?

That’s not an issue. Go to US central bank, ask them for Millions of dollars (precisely round 700…the senate is used to this figure.) They will give it to you. Simple. And I can certainly run a bank better than these jokers who make the banks BANKRUPT.

Me: And how do you repay the loans?

That’s the beauty of it. You owe someone thousand dollars, it’s your problem.
If you owe some billion dollar , it’s theirs.
And when you are in some APOCALYPTIC crisis, UNCLE SAM always looks after you.
In a problem……share your losses……if not own your profits.

Saas,Bahu, CRISIS and CLASHES

“In 2008, the possibility of an economic crisis was suggested by several important indicators of economic downturn worldwide. These included high oil prices, which led to both high food prices (due to a dependence of food production on oil production) and global inflation; a substantial credit crisis leading to the bankruptcy of several large and well established investment banks; increased unemployment; and the possibility of a global recession developed…..” .This is what you will find when you type CRISIS in wikipedia (assumed to the best online encyclopedia although being accused of misinformation by American universities) .How does this affect a common man(the same stupid common man from the movie Wednesday) in INDIA

Ramlakhan (not played by anil kapoor) is a local chai vendor at Khetwadi, Grant road .Once while having tea at his place I once happened to ask him the news about financial crisis he has heard in the news.”Saa’b dekhiye hum nahi jaante about this paison kaa problem. Daily I used to earn 450 rupees, I still earn the same maybe more but when you go to market to buy food, I loose most of my money. I live on rent and my kids study in school if you go to pay fees and buy books end mein 10 rupaiye bhi nahi bachhte." I’ve translated his bambaiya hindi to hinglish so we can understand.This person is maybe a so called “richr” by people livin below poverty line (I wonder when can one decide a poverty line for humans).There are crores of people who live below so called poverty line. Thousands of them die daily in suicides, hunger, diseases and more recently COMMUNAL CLASHES. YES

The financial crisis has started striking the core of human value systems. A local investor may just feel he has halved his portfolio when the market rides on bear but this long huge financial turmoil is simply killing these stupid common men. The common man is now unemployed, with no food to eat and roof to shelter him, he has now become gullible to any stranger who promises him a little hope Look at Orissa where clash is between men(Instigated by VHP) and some more men (instigated by churches).This strike has started affecting neighboring states of Karnataka, Andhra Pradesh. Our Central government is sending Troops to bring this back in order but they never think the causes that can once again lead to these misanthropic activities. The attack on major cities in terms of serial bombings is not the act of Islam (if it was Islam why would they attack Islamabad, Saudi Arabia).It is just sudden change of minds of radicalism. I am not saying that these people are doing the right thing. They are certainly doing the wrong things in the name of GOD. But instead addressing or reaching the cause of these things, We’re busy in implementing POTA or demanding resignation of Shivraj patil, the political parties will never quench their trust for power.

Some people say Capitalism is Privatization of profits and socialization of losses .Personally I believe in the power of free will and choice. I don't think Capitalism itself is the problem, I believe people are the problem. People choose to buy, invest in and consume things that are harmful to themselves and others. We don't need to get rid of Capitalism or become more Communist, we need to educate people to make better choices. The problem is that if we wait too long our system of government and economics might take on a life of its own that is so destructive that there will be no way to recover.