Since my childhood I have been crazy about travelling and journey to new places. I was used to dreaming with my eyes wide open before my journey starts. Imagination of the new place, new people and new culture arouses my nerves and gives me ecstasy of being at place. Hence I usually get a sleepless night before my journey schedule. However, many a times the real journey can be different from your thoughts. But along with time as my brain became older and older my excitement and ecstasy for travelling became younger and younger.
During my early days of life, my journey began when I started to go to the town from my village for my education in the VIth standard. I used to walk approximately 2 kms to attend my school in the town. That was really a great joy and excitement to me to watch and discuss the culture and life style of town which was merely of 4000 population in 1992. During the early days of this journey (4 Km from both side), my muscles never complained to me of their tiredness. I came to know that a person is never tired physically until he is not prepared for it mentally. As a result, abundant with the joy of journey, my nerves and brain was not ready to accept the tiredness. Some months down the line I realized that my brain had been convinced by my muscles and I felt the need of conveyance. At that point of time the only best option for me was cycle...which was available to me after a notorious art of ZID.
But this was just a starting of my journey and various tools (conveyances) which were pushing me to fly high, and to approach more spots to look and enjoy in life.
Just after that again I was very excited in the year 1996, when I was supposed to be acclimatized with the city, its culture and its life style. I got admission in class XIth in the city, which was also a district of state, U.P. as well as the Lord KRISHNA's birthplace, "MATHURA". I was free for the first time from the all family restrictions, like not being late at home etc. and I was heading to a place where I would be my own mentor, I would be having many roads to allure me to follow but finally my sole decision would determine the path I choose to follow either good or not good. Freedom is like a double edged sword, one way it gives you opportunity to act on the situation as you want, other way it takes opportunity to react you as it wants. I can not remember clearly which path I did follow, how did I analyze between good and not good but I just kept learning from every path and journey and kept walking. People react to situations based on their wisdom & learnings from experiences and devise their tools in the process. I don't remember the tools which I used at that point of time to pass the tests of journey, but definitely some tools/techniques were helping me to differentiate between good & not good. Later on I realized perhaps these tools were conscience/ inner feeling/gut feeling as people called it. But above all, I was enjoying my freedom .....and off course, my journey. As I discussed earlier I like to enjoy new places, cultures, traditions and life style, I found all that here. Few days passed, I kept observing the new situations and my new journey(first observe keenly before reacting or adopting to it had been my mantra of life)and I started reacting to it. I watched movies on big screens in theatre, rich with hundreds of comfortable seats with economy order of DC to balcony. Here, I first realized the factor of money and economy standard, every one in the theatre was enjoying the movie but the level of enjoyment was different from DC to balcony. I observed the same class differentiation at many other places in the society which I did not encounter or might be I ignored to observe in my rural life. But one thing is sure that this discrimination is on the larger scale in urban than in rural areas.
After a successful visit to city of population of 2 lacs, my next trip was scheduled for the city with the population of two crores, one among the four metro cities of India as well as the capital of India, Delhi. Mentally, I was not prepared for this trip but during the last two years of journey I won the confidence of my family and my relatives, who were ready to bet on me for my next race of life, and I was getting popularity and quote of long race winner.
I got ready with my kit to start my next journey but could not convince myself to enjoy it this time because for the first time in my life I was not excited for this journey. This is like you have a girl as a friend but not a girl-friend and you have to be dutiful to her. Sameway I was supposed to visit a city which is well known for its glamorous and fashionable life style, people call it " Dilli Dilwalon ki Shahar" but bound by the weight of expactations I bowed down to realities. I felt nervous for the first time before my journey due to the weights of expectations, dreams, achievements and responsibilities on my shoulder. I decided not to enjoy the the city because somewhere, inside my heart, I felt the fear of failure, I was questioning myself again and again if I could perform under such an immense pressure. But I consoled myself, the real winners are those who perform against the direction of wind. Finally, I was hailed to the destination which was different from what I enjoyed earlier or I can say the scale of class differentiation/discrimination was larger than my expectations. Here, You might be able to observe the whole India at one place, from the rough and tough Jaat of Haryana to the intellectuals of Bihar. After all there was not big masala for me in my Delhi's journey and result was as expected ......I could not enjoy this journey and in the process failed to lift the weight of expectations and I returned with nothing.
After this my journey to various other places kept rolling but I could hardly find anything new to exite me except the same the class differentiation & discrimination's in the society more or less at the same level. But during these journies I got accustomed to various important tools like a macho bike, luxurious car, at least AC III tier reservation in train and AC buses which were making my journey more comfortable and enjoyable with the upgradation of my status in society. Hence I was never bothered about others status symbols except of me. This is how time passes and our taste buds gets developed along with it. Our taste buds becomes more mature and seek not only new dishes but also more sophisticated way of nurturing them.
Again one night, at 1 o'clock, circumstances turned the fate and I decided to follow a tour from Mumbai to Delhi in less than two hrs. The aeroplane was the only feasible solution to cover the distance of almost 1100 kms in optimal time. Just after the decision, in next 10 mins the ticket was in my email and schedule departure was on the same day at 5 pm. This time I was more excited than ever before....off course not for a new place and culture but for the new tool I was to use....aeroplane. Since my child I have been dreaming to fly in aeroplane at least once and look at the world from top of it. It gave me immense pleasure that I remember my childhood dream and almost after twenty years I was going to live it. After a long period, I felt, my keenness to observe the new conditions, was at its peak. Again I could not sleep the remaining hours, I was in hallucination almost for next eighteen hours till I landed my feet in Delhi at 7 pm.
My journey began at 2 pm, I packed my small hand-bag along with a printout of my ticket, and I reached Mumbai airport at 4 pm. From the very starting, from the entry gate of domestic airport I was pretending not to be a first time flier, but some of my silly mistakes were signalling me to be wrong, but I did not care much of it and after security checks, I was finally waiting in the waiting hall for an air-bus which was supposed to pick the passengers to aeroplane, merely to a distance of 200 meters. I realized the change of time or the change in me....some days back I was analyzing the Indian auto industry and its growth, and was regressing between the increasing burgeoning class of India and growth of auto industry, In the population of more than one billion only 200 million people in India were earning more than 2.5 lacs annually. This information hurt me alot but at the same time it gave me a sigh of relief and I was proud that I belong to the class where only 20% of total population stand with me and I raised my head up for being above than 80% of the total population.... the same kind of feelings was hammering me at the airport, I was corelating the burgeoning class with travel by air, if ratio goes same( 20% of Indian population has made their journey by air at least once) than I was going to achieve another milestone in my life, that day.
During my journey of one hour forty mins in air, I once again felt the factor of discrimination of society, here the executive class was not doing journey just for the pleasure but for the need and affordability. They were paying high fair not only for the time but also for the service they were getting. The lady assistants were always there to take care of their needs for the next two hours. Obviously, you will feel, a feel good factor and you have been regarded more than your dignity. I could not identify if, this salute to dignity, was a culture of India or just that you have paid for it. But one thing was sure I enjoyed the whole journey and my dignity for next one hour and forty mins...which off course I have to do because I was on the top of the world & my childhood dream had turned into reality which I dreampt 20years back.
My story of dignity did not end at the airport, it boost up further when my friend picked me up from the airport with his new luxurious car of almost fifteen lacs of worth. I enjoyed not only the traveling with the car but also the driving of it on the neat and big roads of Delhi. Finally I was to depart to Agra from Delhi and I did not mind to choose the UP roadways bus to travel in night, as I have became very used to, to these buses. If I rewind my whole journey of life, 80% of that have been achieved through these buses and rest 20% by other tools. But after a long period, I was in the UP road ways, which was supposed to take another 5 hrs to reach my destination which was merely 200 kms from Delhi. I took a seat very near to the engine, which was roaring more than the engine of aeroplane,....now I was comparing everything with aeroplane...how slow it was creeping than aeroplane etc.
Almost after the five hrs of journey I was in Agra and asked the conductor to drop me in between before the bus stand. I don't know if legally these buses are permitted to stop in between or not, but the practice of stopping in between is very usual particularly with UP roadways. Knowing the fact I asked the conductor to stop the bus in between, naively. His reaction on my question was unexpected to me, he not only abused me but also advised that next time better to drop down one kilometer before here otherwise he will through me out from the bus. I was shocked further, when I tried to argue with him that it is his duty to take care of the passengers and mind behaviour with them, another passenger also favoured the conductor and behaved with me in the same manner as the conductor did. He blamed me that I was killing their time by indulging myself in argument with conductor.
Finally I was dropped down in between the bus stops. Actually I was brought down to the earth from the my hellucinations of aeroplane. Before the indulgence with conductor I was at the top of level where I was feeling that I have created a niche for my self among the top 20% of burgeoning class and really I deserve for the dignity and respect I got from the air hostess and air staff. I was feeling that I really deserve the kind of dignity and respect I earned that day. But at the same time I thanked to the conductor who reminded me of my status and taught me a lesson that whatever you have got in the form of respect and dignity you simply have paid for it....
Still my nerves are strained for the short term hallucination I perceived, I am still searching answer to my question, do we really belong to the nation where people put the metaphor of its culture and civilization which is more volatile than sensex???????
....Life is a journey no matter which tool you are using to achieve it , all the tools are just helping to make it easier,.... Just keep walking.. Just keep walking.
Saturday, October 2, 2010
Monday, June 28, 2010
GOLD (A NEW CONTRACT PROPOSAL)
Gold is not merely a commodity, looking back at the history of gold it has its unique phase world wide, in ancient time it was used as a currency, it is one of the highly liquid asset. When it comes to portfolio managers they like to have it in there portfolio because, no specific statistical evidence to come up a relation between Gold and GDP, inflation and interest rate. It is always believe a worthy investment…
When we talk of gold traded on exchanges it is always matter of standardization of gold, in Indian context it should be 995.9fineness while outside India it is traded in 999.9 fineness of purity. Purity of gold in India is measured in the term of karat which means 24 karat of gold is purest and have 1000 fineness, i.e. it has all its particle of gold no other metal is involved there or no adulteration. But gold is very fragile metal so its use in very pure form is never easy, almost impossible. India is largest consumer of gold (800 tones annually). Maximum consumption of it is in the form of jewelries, India has already 22000 to 24000 tones of gold in the form of jewelries, but problem with jewelries is these are not in the pure form (i.e.1000 fineness). Jewelries purity generally lies from 18 karat (i.e. 750fineness ) to 24 karat(1000 fineness).
So our main motive behind the whole story to is to bring these jewelries on the exchange to trade, which will serve us two benefits ,first it will facilitate liquidity ,second it will achieve the actual motive of physical delivery in the form of jewelries.
Our whole idea begins with the standardization of these jewelries, how to standardized them? We have taken two things in consideration, first is purity of gold (jewelries) ,second is weight of gold. Now next unit of trade would be VPU (value per unit) unit. Constraints are 1- purity would not be less than 750fineness.(i.e. 18 karat), 2- weight would not be less than 7.5 gram. (This is because in India general deals happen in 10.81 gram i.e. one toula)
Now question is, what is VPU?
So VPU is equals to purity of gold multiplying with weight of gold. Suppose purity of jewelries is 750fineness and its weight is 10 gram. Than 1 VPU=750*10=7500. And its price once can be derive from the pure gold. For example price of pure gold of 1000 fineness of 10 gram is Rs 20000/ than price of 750 fineness of gold of 10 gram would be (20000/1000)*750=Rs 15000/. In the same way we can also find out the price of a pure gold of 1000 fineness but its weight is 7.5gram. Then its price would be (20000/10)*7.5=Rs15000/. Hence in both the cases the price 1 VPU is same while in one situation there was change in fineness while in other situation there was accordingly change in weight. So moral of the story is, if someone compromising in fineness of gold than he has to adjust it in weight of gold or vice-versa. Now if any body is having a gold of fineness in between 750 to 1000 of any weight minimum 7.5gram if gold is of 1000 fineness and 10 gram if gold is of 750 fineness. Accordingly we can calculate the VPU of gold.
Now we have some basic calculations of VPU……
As we know investor can have any fractional amount of gold and fineness of that amount of gold can lie anywhere in between 750 to 1000, hence to find out the number of VPUs, we simply multiply weight of gold with its respective fineness. Now our 1 VPU is equals to 7500(i.e. multiplication of 10 gm of weight with 750 fineness OR it can be multiplication of 7.5 gm of weight of gold with 1000 fineness OR may be the product of some other unit of weight with fineness).
Accordingly if we have any amount of gold, with any fineness, than we can convert it into standardized unit i.e. VPU. Now its easy to trade on exchange with this standardize unit. But some problems are still there, after calculations we have find out some VPUs in fractions? Than we can have one amendment in our contract, that if any body have fractional unit with him than he has to trade in terms of absolute nearby unit and at the time of settlement he will get premium or discount as per trading terms.
For example I have 7.45 (or 7.95) VPUs with me than I can trade with 7 (or 8) VPUs and accordingly I will get premium (or discount) of .45 VPU (or .05 VPU) unit at the time of settlement.
Now onwards our second proposal is, we need to trade with gold in dematerialized form. How that should be?
To make our reach to general people we have to constitute different exchange approved centre in different cities and towns. Than these authorized centers will provide a card with Unique Identification Number, and that record also should be maintain with exchange as well as with broker, hence just by putting that number in computer broker can know the status of investor i.e. how many VPUs he has in his account and on how many units he want to trade.
Hence simply a general person by putting his gold to nearby Exchange Authorized Centre can trade on exchange, hence this process will increase liquidity as well as a person will be able to get a right price of his gold. Later on this gold can be send to refineries, where it can be converted in to the pure gold if required.70 % of gold reserve (in the form of jewelery) lies with rural India ,hence we need to make a deep penetration to bring that gold on exchange and to being a price maker not a price seeker.
Proposed by-
Bhagwan Singh
Indian Institute of Capital Markets, Vashi, Navi Mumbai.
When we talk of gold traded on exchanges it is always matter of standardization of gold, in Indian context it should be 995.9fineness while outside India it is traded in 999.9 fineness of purity. Purity of gold in India is measured in the term of karat which means 24 karat of gold is purest and have 1000 fineness, i.e. it has all its particle of gold no other metal is involved there or no adulteration. But gold is very fragile metal so its use in very pure form is never easy, almost impossible. India is largest consumer of gold (800 tones annually). Maximum consumption of it is in the form of jewelries, India has already 22000 to 24000 tones of gold in the form of jewelries, but problem with jewelries is these are not in the pure form (i.e.1000 fineness). Jewelries purity generally lies from 18 karat (i.e. 750fineness ) to 24 karat(1000 fineness).
So our main motive behind the whole story to is to bring these jewelries on the exchange to trade, which will serve us two benefits ,first it will facilitate liquidity ,second it will achieve the actual motive of physical delivery in the form of jewelries.
Our whole idea begins with the standardization of these jewelries, how to standardized them? We have taken two things in consideration, first is purity of gold (jewelries) ,second is weight of gold. Now next unit of trade would be VPU (value per unit) unit. Constraints are 1- purity would not be less than 750fineness.(i.e. 18 karat), 2- weight would not be less than 7.5 gram. (This is because in India general deals happen in 10.81 gram i.e. one toula)
Now question is, what is VPU?
So VPU is equals to purity of gold multiplying with weight of gold. Suppose purity of jewelries is 750fineness and its weight is 10 gram. Than 1 VPU=750*10=7500. And its price once can be derive from the pure gold. For example price of pure gold of 1000 fineness of 10 gram is Rs 20000/ than price of 750 fineness of gold of 10 gram would be (20000/1000)*750=Rs 15000/. In the same way we can also find out the price of a pure gold of 1000 fineness but its weight is 7.5gram. Then its price would be (20000/10)*7.5=Rs15000/. Hence in both the cases the price 1 VPU is same while in one situation there was change in fineness while in other situation there was accordingly change in weight. So moral of the story is, if someone compromising in fineness of gold than he has to adjust it in weight of gold or vice-versa. Now if any body is having a gold of fineness in between 750 to 1000 of any weight minimum 7.5gram if gold is of 1000 fineness and 10 gram if gold is of 750 fineness. Accordingly we can calculate the VPU of gold.
Now we have some basic calculations of VPU……
As we know investor can have any fractional amount of gold and fineness of that amount of gold can lie anywhere in between 750 to 1000, hence to find out the number of VPUs, we simply multiply weight of gold with its respective fineness. Now our 1 VPU is equals to 7500(i.e. multiplication of 10 gm of weight with 750 fineness OR it can be multiplication of 7.5 gm of weight of gold with 1000 fineness OR may be the product of some other unit of weight with fineness).
Accordingly if we have any amount of gold, with any fineness, than we can convert it into standardized unit i.e. VPU. Now its easy to trade on exchange with this standardize unit. But some problems are still there, after calculations we have find out some VPUs in fractions? Than we can have one amendment in our contract, that if any body have fractional unit with him than he has to trade in terms of absolute nearby unit and at the time of settlement he will get premium or discount as per trading terms.
For example I have 7.45 (or 7.95) VPUs with me than I can trade with 7 (or 8) VPUs and accordingly I will get premium (or discount) of .45 VPU (or .05 VPU) unit at the time of settlement.
Now onwards our second proposal is, we need to trade with gold in dematerialized form. How that should be?
To make our reach to general people we have to constitute different exchange approved centre in different cities and towns. Than these authorized centers will provide a card with Unique Identification Number, and that record also should be maintain with exchange as well as with broker, hence just by putting that number in computer broker can know the status of investor i.e. how many VPUs he has in his account and on how many units he want to trade.
Hence simply a general person by putting his gold to nearby Exchange Authorized Centre can trade on exchange, hence this process will increase liquidity as well as a person will be able to get a right price of his gold. Later on this gold can be send to refineries, where it can be converted in to the pure gold if required.70 % of gold reserve (in the form of jewelery) lies with rural India ,hence we need to make a deep penetration to bring that gold on exchange and to being a price maker not a price seeker.
Proposed by-
Bhagwan Singh
Indian Institute of Capital Markets, Vashi, Navi Mumbai.
Friday, June 18, 2010
Some very good malpractices in India
"Now a days I am doing a very good work for the society , this is a kind of philanthropy to the victims, also a very good earning to me too." these were the words of my lawyer fried who just started to filed cases on compensation bases for the compensation of those families who had lost their near or dear one in road accidents.
But he explained me this all, very bravely. [I could not understand, he was doing his marketing or was telling me for my shake?] His new boss, in this profession since old time, has done a lot of favor of common people...also he earned a lot for himself too. As well as he has collected working capital and fixed assets for the same business.
Now, he discussed with me what actully this business , working capital is ?...... They claims to the court for compensation to the victim's family to the owner of vehicle by which accident has occured and later on share the money at fix ratio or described before the deal, if they are rewarded by it, However the success rate of getting reward is 99%. In most of these cases the compensation is given by the Insurance companies as the vehicles are insured.. and the company,s lawer also gets some share of the amount to loose the case.( however he also gets salary from the company)..... this is called BAZIGAR (har ke jeetne wale ko bazigar kahte hain).... Further, some other characters also contributes to the story .... when an accident is by unknown vehicles than here comes the working capital of new boss in picture....as he has acquired lot of vehicles to there relatives. He puts these vehicles in the FIR that accident was by his nominated vehicle. At the same time police gives nod to the incident in revert back of some gandhi g(money). Again a fake drivers gets bail plus some gandhi g for the fake accident. Finally, the insurance companies lose money atleast to ten families in the whole drama. The real looser are insurance companies or we all? ....... Being a financial professional my concern is, Is this good for the society or bad for the finacial system?? Because we all are ultimately looser to increased premium or adverse selection and moral hazard problem of the few business men like new boss.......
So, next time, you all please, be ready to pay the increase insurance premium of your vehicle .... this is also an oppurtinity to new lawyer professionals to show off there enterprenure skills to start a niche business......
But he explained me this all, very bravely. [I could not understand, he was doing his marketing or was telling me for my shake?] His new boss, in this profession since old time, has done a lot of favor of common people...also he earned a lot for himself too. As well as he has collected working capital and fixed assets for the same business.
Now, he discussed with me what actully this business , working capital is ?...... They claims to the court for compensation to the victim's family to the owner of vehicle by which accident has occured and later on share the money at fix ratio or described before the deal, if they are rewarded by it, However the success rate of getting reward is 99%. In most of these cases the compensation is given by the Insurance companies as the vehicles are insured.. and the company,s lawer also gets some share of the amount to loose the case.( however he also gets salary from the company)..... this is called BAZIGAR (har ke jeetne wale ko bazigar kahte hain).... Further, some other characters also contributes to the story .... when an accident is by unknown vehicles than here comes the working capital of new boss in picture....as he has acquired lot of vehicles to there relatives. He puts these vehicles in the FIR that accident was by his nominated vehicle. At the same time police gives nod to the incident in revert back of some gandhi g(money). Again a fake drivers gets bail plus some gandhi g for the fake accident. Finally, the insurance companies lose money atleast to ten families in the whole drama. The real looser are insurance companies or we all? ....... Being a financial professional my concern is, Is this good for the society or bad for the finacial system?? Because we all are ultimately looser to increased premium or adverse selection and moral hazard problem of the few business men like new boss.......
So, next time, you all please, be ready to pay the increase insurance premium of your vehicle .... this is also an oppurtinity to new lawyer professionals to show off there enterprenure skills to start a niche business......
Subscribe to:
Posts (Atom)