Monday, July 25, 2016

Common sense and/or application of mind

What differentiates smart people and dumb people or idiots?
It is the power of common sense, a keen eye to observe things, validate what they hear or read, not take things for granted. It is about application of mind on simple things and not doing things blindly or mechanically. A lot of graduates know or taught only doing tasks and not application of mind. Over a period of time and a lot of skulduggery of their bosses and by learning from mistakes they become wise and start using common sense. They start perceiving information and how to relate it to what they already know. But some people are unwilling to learn or disinterested to learn and are sometimes pre-occupied with other than office work to continue being ignorant and committing a lot of errors and blunders at which point in time they are either given lesser responsibilities or are forced to leave the organisation.
A major part of the ability to think on things and apply their minds and be conscious of the environment and data while performing a task or taking a decision is dependent on the way the people are brought up during their schooling or college days. The environment, the people and the projects that encourages them or forces them to think through things is the key to understand how things work and what things affect and how they affect a certain object/objective. This enables them to do a self check with readily available knowledge/information in their head to understand the trade offs and take a decision or perform the task right in the first instance.
Curiousity is another factor that enables people to learn and apply their minds. Curiousity also leads to creative thinking and adds value to things and brings about new solutions. Curiosity too is a factor that has to be encouraged in the childhood and cannot come suddenly at an old age. This factor in turn can be identified and leads to a talent.
Determination helps people focus. Another key factor that avoids innumerable distractions and stops others needs taking over your identified goal. This also allows people to bring more of their resources (time, money, connections, etc.) to the goal instead of using their resources to do other things.
So, to be smart and use common sense, encourage people to increase their curiosity and help them achieve their goals for them to see the value of their goals achieved through determination.

Thursday, June 16, 2016

Financial lines of defense

One must have multiple lines of defense to call upon in need of any financial situation. I will list this order from the first line of defense to the last:
1. Credit card of self
2. Credit card of spouse (for this you both should have an add on card of each other)
3. Cash from ATMs drawing on your various bank accounts
4. NEFT/ RTGS/ IMPS transactions drawing upon the bank acccount funds
5. Taking short term loan from family and friends
6. Short term Fixed deposits in banks
7. Medium term fixed deposits in banks
8. Mortgage of physical gold to raise funds in emergency
9. Stocks or tax free bonds sold in the market/ Mutual funds
10. Selling physical assets (gold, land, building) though this will take time.
These are as per liquidity provided and the amounts available from the various sources.
These various financial instruments should be used to get the optimum level of returns for the risk and while not compromising liquidity.

Saturday, June 4, 2016

Big Hard disk companies skimp over providing data

I wanted to buy an external hard disk drive and had a tough time finding basic data to compare and choose the product. I wanted to buy among the big hard disk drive companies Western Digital and Seagate products, but their information on their website is grossly inadequate.
They provide so many varieties in the segment of portable external hard disk but do not provide sufficient information to distinguish one from another within this category.
Have a look at the information on their websites:

First, the real idea of portable is missing. I was looking for the dimensions of the products.
Second, the weight of the product is missing.
Third, their backward compatibility to the old operating systems is also missing. Will they work with Windows Vista? I cant say.
Fourth, what technology are they using? Are they mechanical or solid state devices?
Fifth, at what speed do they run? 5400 rpm or 7200 rpm? The faster they run, the hotter they get.
Sixth, WD speaks about the backup software in it. But what is the difference between these? Where am I supposed to look for it?
Seven, what is the power consumption of these hard disks? There should be some examples or range of numbers. Nothing is available.
Eight, I have seen some external hard disks being connected to laptops with two usb drives in the past as they need more power to run. I cant make out whether they need single USB or two USB ports to run.

Some of these are very technical, but some are very basic for usability and trade offs while buying a product.
The sad part is not only are these available on the website, these are also not available in the outer box of the external portable hard disk I bought. WD fortunately had the OS compatibility printed on it.

Hard disk companies talk of providing TBs of data but skimp on providing even some basic bytes of important data.

Saturday, March 5, 2016

Girl on Fire

There is a popular song by Alicia Keys called "Girl on Fire"
Hearing this song or going through its lyrics it is hard for me not to imagine if this song was not describing the now banned practice of 'sati' in India. Just saying...

Lyrics of the song are here:
"Girl On Fire"

She's just a girl and she's on fire
Hotter than a fantasy, lonely like a highway
She's living in a world and it's on fire
Feeling the catastrophe, but she knows she can fly away

Ohhhh oh oh oh oh
She got both feet on the ground
And she's burning it down
Ohhhh oh oh oh oh
She got her head in the clouds
And she's not backing down

This girl is on fire...
This girl is on fire...
She's walking on fire...
This girl is on fire...

Looks like a girl, but she's a flame
So bright, she can burn your eyes
Better look the other way
You can try but you'll never forget her name
She's on top of the world
Hottest of the hottest girls say

Ohhhh oh oh oh
We got our feet on the ground
And we're burning it down
Ohhhh oh oh oh oh
Got our head in the clouds
And we're not coming down

This girl is on fire...
This girl is on fire...
She's walking on fire...
This girl is on fire...

Everybody stares, as she goes by
'Cause they can see the flame that's in her eyes
Watch her when she's lighting up the night
Nobody knows that she's a lonely girl
And it's a lonely world
But she gon' let it burn, baby, burn, baby

This girl is on fire...
This girl is on fire...
She's walking on fire...
This girl is on fire...

Oh, oh, oh, oh ohhhhh oh oh oh ohhh oh oh oh ohhhh... [4x]

She's just a girl and she's on fire.

Tuesday, May 5, 2015

The future of PPFAS

Yesterday was a sad day for the financial sector in India with the passing of Mr.Parag Parikh. He was one of the famous value investors in India. His mutual fund, PPFAS is a pioneer of sorts. It has only one scheme, no dividend option and the owner, the manager and the employees themselves have stakes in it. 
Although its returns have not been extraordinary in the short period of time it has been active, its concept is in long term value investing and not going by the flavour of the season and hence, is difficult to criticise considering the concept.
Now, with both the leader, Mr.Parag Parikh and its fund manager Mr.Rajeev Thakkar having passed away in a car accident, what is the future of the mutual fund where a majority have invested in their faith of Mr.Parag Parikh's thinking, insights and knowledge? Is the concept institutionalised enough to carry on the legacy and thinking of its founder? Will it shut shop soon? Will new investors be willing to invest their moneys now? Investors would/should be anxious and be waiting to hear from the company on the steps ahead.

RIP Mr.Parag Parikh and Mr.Rajeev Thakkar.

Tuesday, April 21, 2015

A good reason to invest in equity for the long term

Many investors may be scared of investing in equity as the risk is high. Moreover, a fall in the markets can cause heavy losses to the portfolio.
A friend of mine recently made a great comment on the stock markets. He said, in the long run, stocks can give a CAGR of 10-25% (an annual growth of around 10-15% continuously year on year). Even if the stock corrects by a big margin, say 25%, it is only on the last year's price and I still have many years of appreciation intact.
This is very true for a large number of large cap stocks.
Something to keep in mind while investing in stocks.
This make it a good reason to invest in equity in the long run.

Thursday, December 18, 2014

Lacuna in Annual Reports

The Annual Reports of listed Indian companies are able to hide a lot of information currently. This should be made available for the general investors to take a more sophisticated analysis of the businesses.
Some of the data that should be incorporated in the annual reports are:
1. Past 3 years and Current External Credit Rating (which is anyway publicly freely available)
2. Long term loans repayment schedules (Investors can then see how much the company will get further stressed in the years going ahead as repayments loom)
3. Securities provided to secure the loans
4. Market Valuation of the properties once in three years (This is anyway done for the sake of banks.
5. Promoter pledging and purpose for pledging
This will allow the investors understand/discover the true/appropriate market value of the companies)

As an investor, I would like to know my company better and these can be a better way for investors to understand their companies.

Monday, November 3, 2014

Big Brands are no better

It is a popular idea that while the small shops and smaller brands are suspect in their wares and methods, the big brands are reliable and honest in their business.
But, truth be said: it is not true.
While some which operate in pharma or food may be selling adulterated stuff without enough quality checks or some goof up once in a while, there are certain sectors which violate the norm in a "business as usual" manner. The particular sector I am referring to here is jewellery. There are a few unique aspects to this business. Firstly, women are highly seduced into buying this making this somewhat impulsive and hence less cautious. Second, it is a social norm to buy enough for occassions (marriage, diwali, danteras, etc.). Third, most customers cant differentiate between the quality of stuff sold. Forget carats of diamonds, even 18/20/22 carat gold cant be differentiated by a layman. To top this, fourth, the metals are sometimes plated (by how much thickness?) and are sometimes embedded with stones (diamonds, rubies, etc.) and it is impossible to measure the weight of it without damaging/destroying the item.
All the above make for excellent toxic environment to cheat the customers even in the best light of the day and get away with it scot-free.
It is because of these reasons that this business is done based on trust and from the below article, this business is mostly run by cheats.
Big Jewellery Brands Cheating
When big well known brands like Mangatrai Jewellers, Sri Krishna Jewellers, Meena Jewellers, TBZ Jewellers and Kalyan Jewellers, RS Brothers Jewellers, South Indian Shopping Mall and Chennai Shopping Mall, it is time to stay away from Jewellers itself as much as possible.

Friday, August 1, 2014

Call centers face mass exodus after govt. starts recruiting monkey mimics

Employees from various Gurgaon based call centers have started tendering their resignations after the new government has announced new jobs employing people to wear langur costumes and scare away monkeys.
An Gurgaon based call center employee has this to say on being asked why the monkey mimicing job was so popular: "The job is so lucrative. It pays me more than a fresher in a call center and there are fixed timings and only day shifts. Whats not to like."

A HR person of the call center said, "This is going to create a lot of fresh problems to the call center businesses. We continuously train a lot of freshers for doing a variety of monkey jobs at our office. Now with this job opening, we fear many of our excellent employees may leave us for these jobs. There is  going to be a fresh talent shortage in the near term."

The mad rush of applications received by the government has put it in a tizzy. Some minority groups have already started asking for a quota for the new jobs. A spokesperson of the leading political party in the central government said "The new government had promised to bring new jobs to the economy. This is the first major step we have taken towards creating new jobs."

The HRD minister commented on the same issue: "You know how Indian kids are. Right from school days, they start making monkey faces. They have a natural talent of it and we recognise that such talent should not be wasted and could be put to good use this way." Going on the way forward on other initiatives proposed by the government, she said, "We are also looking at many zoos in India where are not enough animals on display. We have set up a inter-ministerial committee to work out the details on people to mimic other animals and provide them employment in the zoos."

One of the elderly retired residents in the areas which are populated by monkeys had this to say, "This should be extended beyond the parliament to other areas also. I have wondered at times, how to effectively contribute to my society. I think I will try to take this job as this will satisfy my need to contribute to the society. We also have a lot of young boys and girls doing nothing useful loitering around in colleges. Maybe this should be made compulsory for a few days a year for all students as part of CSR activity of colleges and schools."

Meanwhile, an elderly group of monkeys has heard chattering somewhere near the parliament: "These langurs are bigger, but dont climb or run with the four legs like the old ones." "I saw one with a human head and a langur body" "I went near one langur and there was the 'yaar na mile' song coming from it".

Maybe the monkeys will soon figure out the plot and monkey mimicing plan would bomb back on us soon.