life in general: the miraculous hibiscus tree!

A little over a year ago, my naturopath practitioner, Raj Merchant, whom I have been going to for health/ailments advise/treatment for about 18 months now, made me aware of a small tree that is commonly found all over in Bombay and perhaps other cities/places in India and elsewhere. This is the Hibiscus tree.

I had skin infection on my right thigh and in one quick look at the infected part he diagnosed it as not an isolated skin infection problem but a stomach indigestion and hyper-acidity problem that was causing the skin infection. He told me to chew & eat the leaves or flowers of the Hibiscus tree and I will be allright.

(the pic to the left is that of a Hibiscus small tree that I took in August '08 outside a building in Bombay)

I did that (chewed & ate the leaves from a Hibiscus tree in the compound of my residential building) and it worked miraculously. My skin infection was gone in 3 days! The leaves/flowers that become gummy when chewed removes the toxins and excess acids from the intestines and throws them out. They also act as a laxative for those who suffer from constipation.

Since then I have continued to chew Hibiscus leaves 1/2/3 times a week and must say it is a miracle tree. A little bit more about its health virtues -- here & here.

life in general: revenge for the sake of it is not wise...

World over, today, many intelligent people in governments, militaries, police forces, companies, political parties, bureaucracies etc tend to believe that a wrong should be avenged. All conflicts of the world, whether involving multiple countries or internal groups in a country, have a major dose of revenge for past (recent or historic) wrongs built into them.

My thoughts on this:

1. Revenge for the sake of it is no good at all.. I am, however, all out for the strongest forms of self-defense against future real threats. And if it means striking the sources of those threats then so be it. But this should be without any loss of innocent civilian life. If that is not possible, then I am not for it and would then focus majorly on strengthening internal defenses which anyway should be done regardless of anything else.
Also, the threats should be real. Not like the bogey of 'weapons of mass destruction' that the Bush-Cheney gang of thugs had come up as a sorry excuse to attack, invade and brutally occupy Iraq.

2. Don't commit any wrongs to others and others will not feel the need to take revenge on you . The same logic (as I presented in '1' above), however, applies to those whom we would have wronged.

3. Even when revenge is sought to be extracted by mis-guided extremists of all hues then it should be a real revenge and not cowardly attacks on innocent bystanders and civilians. So, if Hindu extremists, are pained at something that Muslims did 400 years back in India then where is the logic for taking revenge on the current generation of Muslims? The Muslim perpetrators of 400 years back are all dead. The same logic applies to Muslims' ire against Israel and some others in the western world.
Also, the last week's Muslim extremists terrorists who attacked Bombay should have known that killing general citizenry is not just a horrendous thing to do but cowardly too. Will they ever have the guts to take on directly the likes of Bush, Cheney, Rumsfeld and Narendra Modi? Will Modi and his gang of terrorists in Gujarat ever have the guts to take on the mullahs and royal family of Saudi Arabia for funding and supporting worldwide Muslim extremism, instead of murdering innocent Muslim children, women and men who are Indian citizens?

life in financial markets: debit you lose!

The hypocrisy of corporate and financial institutions is to be experienced to be believed! Take the instance of the issue of banks in India giving no option to customers to manage the risks of fraud on their savings. This is happening through the forced issue of ATM-cum-debit cards. Visa is the main culprit here because it is pressurising the banks in India to issue debit cards to millions of bank customers in India. Visa knows that ATM transactions are inevitable for bank customers, so why not thrust a ATM-cum-VisaDebit card on them.

For over a decade banking technology has been such that customers can not imagine living without the 24-hour-a-day convenience of automated teller machines (ATMs) for withdrawals, deposits or other transaction purposes. In the last few years, however, almost all the banks in India have stopped giving ATM-only cards and instead offer only debit-cum-ATM cards.

Visit any bank's branch, read any bank's savings account opening form, browse through any bank's website and almost nowhere is they are any option given to customers to choose between a debit-cum-ATM card and a ATM-only card. Majority of the debit cards are of Visa and some are of Mastercard.

Since a debit card is linked real-time to a savings or current account the potential amount of loss due to shopping payment fraud on a debit card is higher because the entire savings account balance is available to a fraudster. If one were using a credit card for availing of the convenience a plastic card provides then one has the ability to set a much lower credit limit than one is eligible. Interest cost is easily eliminated in a credit card since outstandings can be effortlessly paid back fully before the due date through a direct debit on the savings account if the customer is banking with the same bank.

By not giving the choice to opt out of a debit card banks are increasing the risk of customers. This is ironic in a day and age when risk management is the buzzword in financial management for everyone including individuals. The biggest risk in all plastic cards, debit or credit, arises when a customer loses the card and his/her signature is there on the card to be easily forged and mis-used at merchant shops. Customers therefore need to be given enough flexibility to mitigate their risks based on their personal preferences.

Banks tend to justify the ATM-cum-debit by highlighting debit cards' benefits like freedom from carrying physical currency, special offers at merchant shops and so on. "Based on these benefits our front end tries to ensure that maximum savings account customers are carded with debit cards," is the line that banks would take.

This is the reasoning made by all the banks. But shopping on a debit card is not a core banking feature which attracts customers to bank with banks. "As a policy the right to choose should always be given to the customer," feels professionals working in the corporate consultancy industry.

The banking regulator, Reserve Bank of India (RBI), has so far left it to the banks to decide on what cards they can issue. Visa and Mastercard point out they are not responsible for the banks' policies. But, Visa, the largest card payment company in the world, does use the transaction value figures arising out of ATM withdrawals by customers from their savings or current account using their debit-cum-ATM cards in all their performance statistics.

Banks in the developed markets such as the US and the UK give their customers the freedom to choose between a debit card (or a checking card as it is known in the US) and a ATM-only card. In emerging markets such as India and Thailand the choice is not given. Visa's statistics brings out the effect of this. Cash withdrawals from ATMs are reflected in debit card cash transactions and there is a clear divergence in the usage trend in US an non-US countries. (see graph below 'Debit you lose, credit you gain').

HDFC Bank and ICICI Bank are perhaps the only banks in India that will give a ATM-only card only if the customer forcefully asks for it. For the rest, the choice is non-existent no matter how much you fight for it. This writer has approached, without success, Yes Bank, Corporation Bank, State Bank of India and Punjab National Bank for the opening of a savings account asking for a ATM-only card to be issued and not an ATM-cum-debit card. It is high time the RBI sit up and take notice of such regressive attitude of banks.

Visa also needs to answer a couple of pertinent questions. The banks are members of Visa network and Visa can very well mandate them not to indulge in the above unethical practice. Since customers are forced to opt for the ATM-cum-debit cards, even the normal banking transaction withdrawals from their own banks' ATMs get used by Visa in its statistics as we saw above. Technically, these transactions would not be Visa's if the customers were given a choice to opt for pure ATM cards and any of them would opt for it. Isn't this clearly a fraudulent accounting practice by Visa?

Individual customers, till such time as the regressive practices of banks and Visa or Mastercard come to an reduce or at least reduce, can also take one or two precautionary measures. For one, they should not be tempted to use the debit-cum-ATM for merchandise or internet shopping. This should be done through their credit cards where they should set a credit limit, lower than they are actually eligible for, and which is comfortable for them to bear in case of a fraud on their credit cards.

Simultaneously, they can mitigate the risk of fraudulent use of their debit cards by simply crossing out the signature strip. This way they would not leave behind their signatures for any fraudster to forge in case they lose their cards to such a fraudster. When this frauster goes to any shop, say a jeweller's shop, to swindle your money, he has to sign at the transaction slip of the shop. The shop manager has to match this sign with that on the card and when he sees the crossed area on the signature area he will get alert and reject the transaction and perhaps apprehend the frauster.

But some shop managers do not even bother does the basic matching and the fraudster can still get away with a fake signature (the fraudster won't know your real signature and will try to fake it by signing it his way using your name). Even then you can seek protection against a payment obligation arising out of such a fraudulent transaction by pointing to the difference between the fraudster's signature on the transaction slip (that will lie with the shop or the bank) and your real signature in the bank's records.

Secondly, since debit cards are linked to savings account then SMS-based alerts on debits in our savings account can help. So, if your bank is offering SMS alerts on your savings account you should opt for it. This way, a fraudulent transaction on your debit will throw a SMS to you which you can see to be one not authorised by you and take action immediately. Here, however, there is no guarantee of the frauster being caught.

The RBI will be forced to shake off its lethargy in checking the banks' forcing of debit-cum-ATM cards on customers, if enough customers complain to RBI. Go to www.rbi.org.in and register your complaint about the banks' unscrupulous practices. The RBI will be forced to sit up and take notice.

life in general: ...without any collateral damage whatsoever

Elaborating further on what I said in my previous post "...And if the US can attack Taliban inside Afghanistan, and if Israel can carry out operations inside its neigbouring countries including Palestine, and if Russia can carry out operations inside Georgia, then India can too carry out operations in the mountains of Pakistan where these terrorist groups receive their training..." I think any Indian military-led assault or aerial bombings of those training camps in the mountains of Pakistan has to, in my view, be carried out without any collateral damage whatsoever.

If that is not possible then we should desist from carrying out any operations and instead aim, through super-efficient intelligence information gathering operation, to eliminate, one by one, the leaders of the heads of these terrorist groups including the ISI guys involved in it.

No innocent civilian life in Pakistan should be taken in India's response to last week's terrorist attacks in Bombay. Everyone, including the private terrorist groups the kinds of which were involved last week, has some kind of mental justification, whether valid or not, to do their violent deeds and 99% of the time their deeds involve taking the lives of innocent non-combatant civilians. India should ensure that it does not end up becoming like the terrorist killing innocent civilians. We have seen how the US-UK military has shamed itself by doing just that (killing civilians) in Iraq and Afghanistan. We should not emulate them.

Jingoism by Indians has to be avoided if we have to be considered as being fair. As I had mentioned in that same previous post terror has many forms. I would like to add that our desire for justice on such heinous wrongs should be extended to every form of terror including state terror and the terror of companies on tribals & villagers in remote places. Many affluent Indians' lives were taken in the Taj and Oberoi and while I pray for their souls' peaceful transition to the astral plane for healing I must point out that the strong reactions against terrorist emanating from the affluent circles in India is a bit selfish. These same very people don't care when their excessive materialism/consumerism or their involvement as senior/middle management in industries/companies are the causes of corporate-police-state terror in remote areas of India.

Below is a wikimapia snapshot, with a white circle added by me of the region in Pakistan where terrorist bases & training camps are believed to be. Click on the image to see it enlarged & clearer.

life in general: bombay takes stock...

As many in Bombay, rest of India and rest of world, take stock of the real casualties figure and the potential real details of terrorists' entry/operations/motives & lack/disregard of intelligence agencies' alerts (read here, here and here), a few random thoughts and 1/2 personal experiences that I want to share:

1. I have been to Taj, Oberoi and Leopold many times in the last many years, the first two for attending work-related seminars/conferences and the last for a glass of beer. About 7 weeks ago, when I went to Taj (i was going after a gap of about 3 months), and as I went to the secondary entrance that faces the sea directly (and not the primary one that faces the Gateway side) I saw it was closed and completely barricaded. So I made my way to the primary entrance and there was struck by an unprecedented security check with 2/3/4 gun-toting security men standing at the entrance. My shoulder bag was checked thoroughly. I had a bit of argument with the security guard telling them that while it is fine for them to check bags of mine and visitors why were they not opening the bags of the guests who were checking in to stay at the hotel. Seeing my verbal conversation with the security guard a black-coated Taj manager who was standing there near the entrance walked up to me and sternly asked me what was wrong. I told him, but by then I had seen that check-in guests' bags were going through a metal detector itself (that though begs the question of how plastic explosives can be detected).
The point I am making above is that intelligence agencies' alerts had already reached the managements of most of the biggest hotels in Bombay. A TV news channel, Headlines Today, is in fact just now (as I write this at 3 pm) reporting that it has a 'top secret' letter by Indian intelligence agencies to the Bombay police that in their interrogations with captured terrorists in Uttar Pradesh and other places in north India they have been told that Pakistan's ISI and even Pakistan's Navy is involved in training terrorists to launch an unprecedented, well-organised offensive through the sea route from Karachi to Bombay.
This letter is apparently dated December 2006, but the unprecedented security checks I mention above only about 2/3/4 months back. This newsreport in Outlook brings out even more information about the heightened knowledge of an impending sea-borne attack. As is from my above-described experience, this information had also been passed on to the Taj Hotel and perhaps the other big hotels in Bombay too. But the Taj Hotel management (and also the Oberoi Hotel management) did not take adequate measures to protect every corner of the hotel. As I quoted a Colaba-residing friend of mine in my previous post the terrorists gained entry in the Taj from a shop at the backside and the shop opened outside on the street as well had a door that opened inside the hotel. Why didn't the Taj management keep gun-toting security men continuously (for 24 hours and not just during peak-time daytime hours) at all ground-floor corners and sides of their hotel/s from the inside and the outside? Instead of blaming the government, Ratan Tata should have taken his hotel's management to task for not taking seriously the threat perceptions emanating intensely from the intelligence agencies. Night-time security checks also seems to have been lax compared to day-time security checks.

(the pic to the right has been taken from mumbaimirror.com and shows the terrorist who was at the VT station, later caught alive & now in official custody)

2. The TV news channels (and not so much the print media although many of them too) have focussed 99% of their news coverage on three places--Taj, Oberoi and Nariman House--and have not culled/scoped out the happenings at VT station, Leopold Cafe and Cama Hospital. There is much to be reported and analysed from these other places as well. VT station, for instance, saw over 50-60 casualties and Leopold saw over 25.

3. Even at this time of tragedy, the inefficiencies and corrupt bureaucracy of state/private administration continue to trouble the relatives of the victims and the missing.
Also, the Colaba Police Station that is opposite Cafe Leopold, had the most pathetically inept response when the firings were going on at Leopold and which they could easily hear. They were deliberately slow in reaching that place (even though it was less than 20-30 metres away) and in fact like cowards closed the gate of their police station. Residents in Colaba, who know about them, of course say they did not expect any better from the Colaba police station which could perhaps rank among the top 5 corrupt and brutal police stations in Bombay and in the top 10-20 in India. Had Colaba police station officers counter-attacked the terrorists at or near Leopold Cafe itself those guys could have never reached Taj Hotel. But their police officers are so steeped in corruption they have lost all ability for any concrete action involving using their guns to take on the real goons or in this case the terrorists.
This newsreport also says that at CST station there was armed police personnel that could have easily shot dead the two terrorists. But they did not do so. Shameful!
4. Pakistan's ISI is perhaps the worst official agency in the world that cleverly aids terrorists' activities and has been doing so for many years. For India to put pressure on Pakistan's current democratic pressure is being foolish. The ISI in Pakistan, closely affiliated to the Pakistani military, is a law unto itself and has to be tackled directly bypassing whoever is the Pakistani government. For this, in fact, India should shed its cowardliness and take on the United States of America that in the past and even now (discreetly though) has looked the other way if not actively coordinated with the ISI. And if the US can attack Taliban inside Afghanistan, and if Israel can carry out operations inside its neigbouring countries including Palestine, and if Russia can carry out operations inside Georgia, then India can too carry out operations in the mountains of Pakistan where these terrorist groups receive their training.
Many of general Pakistani citizens do not like their country's ISI and extremist elements. By blaming Pakistan as a country where its citizens do not have enough democratic rights is according to me not wise at all.

5. It also needs to be told that the owners (two of them -- Faizad and one more) of Leopold Cafe are racist against locals, Bombayites and Indians and give extra-special treatment to the foreigners. I say this from personal experience, and therefore avoid going there to the extent possible. I don't blame the waiters as I think they are specially trained by the two owners to be like this.

6. What has happened is 'private' terror, that is, private groups (though backed by overseas official agencies like the ISI) have carried it out fighting state forces in India/Bombay. But we ought to remember the ugly consequences of other forms of terror that feeds into the private terror groups. And one of them is 'state' terror. India is not at all clean on this. The state-sponsored genocide in Gujarat in February-March 2002 and continued boycott/harassment/denial-of-rights of the Muslims in Gujarat stands out as one of the worst forms of state-sponsored terror anywhere in the world. Then, the US-UK-Australia ugly & illegal invasion of Iraq in March 2003 and continued forced occupation of Iraq is even a worse kind of state terror
than Gujarat was because the entire country of Iraq and all its citizens have been hurt badly by the American-British forces.

life in general: horrific tragedy; who, how, why?

(the pic above has been taken from mumbaimirror.com, casualties at VT/CST railway station) (updates to this post are given below)
As the intense nature of tragedy unfolds in Bombay this new morning (it is 10.25 am as I write this) (click here, here and here), the question that is coming to most people's mind is 'Who did it, where did they come from last night, how many were involved?'.
It looks like a very organised operation that could have emanted from outside Bombay itself, except for recce operations done earlier. Very few terrorist groups have the capabilities to carry out operations of such a heinous nature -- Al Queda and 1-2 other Muslim extremist groups being the most prominent. It appears to be their doing.
But police and Indian intelligence agencies did have a whiff of this, for sure. The targets -- 5-star hotels and large railway stations -- were commonly known, but the likely dates of the strikes could never have been easily forecastable by anyone.
One more point: its not only foreigners that have suffered heavy casualties, local Bombayite-Indians have too. See the first news link above, and one of the pics below.

Pic 1 to the right: After shooting passengers in the waiting area for long distance trains at CST/VT, the two terrorists walk to the local/suburban platforms
Pic 2 to the right: This man, shot inside CST/VT, managed to walk to the subway entrance outside near Capitol cinema. Both pics are from mumbaimirror.com

Update 1 (5.54 pm, Bombay time): From 3 to 4.30 pm, I commuted by road & rail from my home in Kandivli (north-west Bombay) to office in Worli (central Bombay) that is 30 kms to the south from my home. Am at office as I write this. Catching up on tv news footage and a lot is still going on. Terrorists are still there at the two hotels and also at a Jews-owned guest house called 'Nariman House' at Colaba area. Guests and visitors at these 3 places are still trapped inside.

Update 2 (7.15 pm, Bombay time): Ugly incidents (blasts, gun firing etc) still on at the 3 places although police/army commandoes are also inside 1/2/3 of these and carrying out combing operators.
An aside. Yesterday, senior police officials were killed, purportedly in action and by terrorist. I have my doubts though In the murky world of Bombay police and governmental secrets anything is possible. My hunch is that Hemant Karkare, one of the anti-terrorist cell (ATC) chiefs, that got killed yesterday, could have died in mysteriously unexplainable circumstances yesterday. It is very unlikely that the overseas/Pakistan-based attackers of Bombay would know they were shooting a chief. I suspect there is something very majorly wrong in the police-ATC-government-politicians-Hindu extremists nexus/hotchpotch that has led to 1/2/3 of these senior police guys being killed yesterday night.
Update 3 (8.30 pm, Bombay time): Its still on, unfortunately, but some rescues are also taking place but again they are being shrouded in secrecy by the police (which is pathetic). Updates at ibnlive.in.com timesofindia.com, expressindia.com or mumbaimirror.com to get updates.
But I would like to briefly share a conversation I had today with a Colaba-residing friend who was at the Colaba Causeway Street yesterday and witnessed the post-firing part of incident at Cafe Leopold.
In his words: "I was about 100 metres near Leopold when we heard shots. We thought it was firecrackers being burst by cricket fans on winning yet again in a one-day international. But when it continued for 3-4 minutes we realised it could be bullets and some of us started moving in the direction of Leopold. We heard gun shots clearly. This was somewhere around 8.30 or 9 pm, and approximately 30 rounds of machine gun fire must have been fired. It lasted for about 15-20 minutes and then the 2/3 terrrorists casually walked out and started walking in the direction of the Taj Hotel. We went inside Leopold and I actually helped in pulling out about 25 dead bodies out. Later, we heard, the terrorists killed at least one, a little boy, while walking from Leopold to Taj, just because he strained himself to see them. Later, we also got to know how they or their earlier fellow-terrorists entered the Taj. There are shops at the side of Taj Hotel that have entrances from the streetside as well as inside (see the green arrow-marked area in the map-image to the left, click on the image to see it enlarged & clearer). If I remember correctly since some months they used to be shut from the streetside and entrance only allowed from inside the hotel. The terrorists went to one of the these shops from the streetside. First there is a iron grill door with a lock, then a glass door entrance. The terrorists first broke open the lock of the iron door, then shattered the glass door, went inside the shop and then through that the other side of the shop that opens into the hotel they entered the hotel and went on to the lobby. They opened fire when inside."
Update 4 (11 pm, Bombay time): Its perhaps getting over now, although the situation at Oberoi/Trident Hotel is still uncertain.
Meanwhile, some of my thoughts on the hypocrisies of corporate bigwigs when journalists were questioning them today on their thoughts about the terrorist attacks. Ratan Tata, who directly or indirectly, owns the Taj Hotel, blamed the government for not protecting the Taj Hotel. What crap! The government is what it normally is -- inefficient and inept. But what prevented his brilliant directors, managing directors, vice presidents and senior managers from posting strict security at all corners of the Taj Hotel, particularly when intelligence reports had given them the indication of being under threat. Why couldn't he spend a few millions extra to beef up the security and post gun-toting security guards at the back-side (where the terrorists seemed to have entered and even by making noise as they had to break the glass door of the shop) and at other corners of the hotel? Its typical of the corporate world to pass the buck of miserable failure on to the politicians and government bureaucrats. But my heart goes to the families of the employees (about 16-20) of Taj Hotel who lost their lives to the cowardly terrorist attacks.

life in general: terrorists attack locations in south bombay

(important updates to this post made below, before the updates whatever i have written i am not changing it but they were from very early reports and not comprehensive)

(thursday's update: new post here)

As I write this (11.50 pm of Wednesday 26 Nov '08) from my home in Kandivli, in suburban north-west Bombay, I am tracking web-based news (no TV at my home) of of terrorists having attacked a few locations in south Bombay (or town area as we Bombayites call it). Hotels Taj and Trident (earlier called Hilton/Oberoi), Leopold Cafe, VT/CST railway station, Colaba market are some of the places where gunmen are being reported to have opened fire randomly and also executed a few bomb blasts (not of severe intensity though).

Some detailed newsreports are here and here.

I spoke with a friend who stays near Strand road in Colaba and she tells me that they heard a loud explosion that seemed to come from the Colaba market side. This is the only bit of news that I have that the above-linked newsreports have not covered yet.

The image to the left is taken from here. It depicts an injured person being taken out from the lobby entrance of Taj Hotel near Gateway of India.




Update 1 (0035 hrs, Thu, 27 Nov):
Below see a quick snapshot of Wikimapia of the south Bombay area where the terrorist attacks have taken place. I have marked out four spots in white arrow marks -- VT/CST station, Taj Hotel (near Gateway of India), Cafe Leopold in Colaba, and Hotel Trident/Oberoi/Hilton at Nariman Point. Click on it to see it enlarged and clearer.

Update 2 (0121 hrs, 27 Nov):
Sad. Latest news reports are bringing out the horrors of the attacks. About 80 dead and over 200 injured is being reported here.
The five-star hotels have been under tremendous security in the last few months. I remember going through rigorous check myself at the Taj Hotel near Gateway of India when I had gone to attend a seminar about 7 weeks back. Except for the VT/CST railway station and perhaps 1/2 other spots, all the rest spots picked by the terrorists indicate an intention to target foreigners because hotels Taj and Trident/Oberoi and Cafe Leopold are all places where foreigners can outnumber Indians.
Update 3 (0200 hrs, 27 Nov):
My heart goes to the near and dear ones of those who have died in these ugly attacks and to those who have got seriously injured. Few questions come to my mind, in the case of the 2 hotels. If the gunmen have killed people inside, that is in the hotel lobby, then how come they were able to take guns and perhaps also grenades inside in the first place? The stringent security checks should have prevented that. Or, is it that the gunmen started firing from outside, overpowered or killed some security guards and forcibly entered the hotels' lobbies? Answers will come in next 1-2 days in the media, hopefully.
Update 4 (0226 hrs, 27 Nov):
Jeez! Its getting uglier. Now, a hotel in Juhu attacked; abotu two anti-terrorist force squad members killed, fire in old building-wing of Taj Hotel . Click here. This seems to be a very good site so far.
Update 5 (0302 hrs, 27 Nov):
Some photos are over here.
Update 6 (0356 hrs, 27 Nov):
Am signing off for now with this updated news report on The Times of India website. I have no TV at home & so caught all news only on the internet. I will pray that Bombayites and other Indians do not indulge in callous, ugly reactions to the tragic events of the last few hours. The minorities in Bombay ought not to suffer from any violent ugly reaction from extremist Hindu groups. I pray.

life in financial markets: oversmart citibank, icici bank....

Citibank's extra-brilliant and massively-remunerated top management and young, savvy, highly-qualified senior managers, went for a bailout to the US government agencies with a begging bowl in one hand and a gun in the other. "Please please give us aid or else I will shoot you!" is perhaps what the sophisticated goons of the financial world told the sophisticated puppets of the regulatory/government world! Read here and also read the comments section there (one guy writes "At this point the mindless debt addicted bailout bulls are a menace to society. Stock bugs want to do their thing on the taxpayer's dime. That is their only argument now and they have no shame. At this point anyone who promotes a "stimulus package", i.e. more debt, should be pelted with rotten fruit..")
Meanwhile, here in India, the securities market regulator, Securities and Exchange Board of India, has finished preliminary investigations into ICICI Bank's ludicrous allegations of its stock being hammered down. I had written about the witch-hunt against sellers (short or tall!) on 29 October.
Sebi has found nothing unusual in the trading in ICICI Bank. I give Sebi's full press release of 20 Nov '08 below. All this leaves an egg on ICICI Bank's face. The other cry baby, Unitech and their promoters Chandras, also better learn a valuable lesson and that is to stop crying when the going is tough particularly when you were never humble when the going was terrific.

Sebi's press release:
www.sebi.gov.in/press/2008/2008266.html
PR No.266/2008

Trading in the shares of ICICI Bank Ltd.

· In the backdrop of a global crisis in the financial sector and amidst liquidity fears, the share prices of several leading financial services companies across markets suffered a sharp decline. Rumours of financial trouble have caused a run on the banks in some overseas jurisdictions. The main spillovers have occurred in financial markets, reflecting the relative integration of such markets in the global financial system. In India, since January 2008 there has been decline in shares prices across sectors.
· ICICI Bank had vide letter dated September 17, 2008 made a complaint to SEBI alleging that “a malicious rumour is being spread to the effect that some of the top management have been selling ICICI Bank shares for the last few days”. The price of the shares of ICICI witnessed a fall of 12.5% from Rs. 640 on 15/09/08 to Rs. 560.30 on 17/09/08.
· ICICI Bank, on September 16, 2008 disclosed to the public through a press release about ICICI Bank UK PLC exposure to Lehman Brothers i.e. “ICICI Bank UK PLC is holding investment of Euro 57 million ($80 million) in senior bonds of Lehman Brothers Inc. ICICI Bank UK PLC already holds a provision of about US$ 12 million against investment in these bonds. Considering a 50% recovery estimate, the additional provision required would be about US$ 28 million”. On September 17, 2008, ICICI Bank Ltd informed the exchanges that "A malicious rumor is being spread to the effect that some of the top management has been selling ICICI Bank shares for the last few days. These rumors are baseless and irresponsible, and no shares have been sold by members of the top management of the Bank during the current year. ICICI Bank is taking up this matter with regulatory authorities for necessary action against those responsible for the rumors".
· The shareholding pattern of ICICI Bank for the quarter ended on June 30, 2008, shows that around 68% of the shares were held by FIIs/Foreign entities (ADR). Similarly figures for the next quarter that ended on September 30, 2008, show that around 65% of the shares of ICICI Bank were held by FIIs/ Foreign entities (ADR) Rest of the shares by Indian Public including institutions. FIIs have reduced their holding in ICICI Bank between the quarter that ended on June 30 and Sep 30, 2008 by around 3%. The underlying shares against ADR held by Global Custodian also show a fall of around 20.5 million shares during the period representing Jan 1, 2008 to Sep 30, 2008 indicating an increase in the shares available in the Indian Market.
· It is seen that the prices of ICICI Bank fell by 49.52% from Rs.720.45 on September 8, 2008 to Rs. 363.65 on October 10, 2008. During the same period, prices of ADRs of ICICI Bank saw a fall of 53.25% from Rs.717.77 on September 8, 2008 to Rs.335.55 on October 10, 2008. The prices of ADR has fallen more than the shares of ICICI Bank in Indian market. During this period NIFTY and SENSEX witnessed a fall of 26.82% and 27.3% respectively.

Trading pattern of the shares of ICICI bank was analyzed for the period September 8, 2008 to October 10, 2008:

1. The client category-wise breakup of turnover in the shares of ICICI Bank in the cash market shows that FIIs accounted for 23.57% and 18.61% of the value of shares sold and bought respectively whereas rest of the investors accounted for 76.5% and 81.4% of the value of shares sold and bought respectively.
   

2. Top 20 investors in ICICI Bank both on net buy and sell basis in the cash market shows that majority of them were FIIs (Net Buy: FIIs-14, MF-4, DII-1, Others-1) (Net Sell – FIIs -17, MF – 2, Others-1)
   

3. None of the major seller were observed to be placing orders successively at lower price
   

4. There was no pattern observed regarding placement of successive orders at lower price by sellers to hammer down the price.
   

5. There was no pattern observed of booking intraday profits by major clients or brokers during this period.

By and large, the trading patterns are consistent with the shareholding pattern of ICICI with predominant holdings by FIIs, the general buying and selling behaviour by FIIs and the broad movements of the market during this period. While SEBI continues its surveillance of the stock exchange trading in various securities, SEBI did not find evidence of manipulative trading in the ICICI Bank shares during the period referred to above.

Mumbai
November 20, 2008

life in general: a trek to highest point in bombay's forest area

Outdoors is a great place to be in. If you are living in an Indian urban nightmare, outdoor activity also provides you with a chance to get away from your home/flat that has more likely than not to have toxic materials (like asbestos where labourers also suffer heavily) & toxic chemicals used during the construction that would be banned in other countries that India & China claim to be outpacing in terms of economic growth.
So (as I do sometimes occasionally, sometimes frequently) I was out yesterday from morning to afternoon, as a part of a Bombay Natural History Society-organised trek to the highest point of the Borivli National Park's designated forest area.
From the Park's Borivli-side main gate, we went inside by a vehicle on a 4 km-road to Kanheri Caves point and from that point we (there were about 40 of us in the group) trekked a distance of about 3.5 kms up to the highest point. I could motivate my 16-year nephew, Rahul, to join me for this trek. It was a first for him and he enjoyed it thanks to his positive approach and his damn good stamina!
Below are some pics: (top left and top right ones are mid-way through the trek, the top right one shows tulsi lake & vihar lake, the top left one has me with a ruffled-hair look), bottom left and bottom right pics are at the end-point of the trek, bottom left pic has my nephew in it with tulsi lake in the background). The pics are followed by a wikimapia snapshot of the area (the yellow circle is where we trekked and the green circle is where my home is, you can see as the bird flies it is very near but we are not birds so I have to go north to borivli by road, enter the Park gate and come south again). Click on a pic to see it enlarged and clearer.

life in financial markets: it was a dash to trash

I just came across this very insightful story at asianinvestor.net. Here it is:

asianinvestor.net/print.aspx?CIID=128414
Risks were ignored, but crisis wasn't unexpected
By Nick Ferguson
17 November 2008
SocGen's head of strategy arefers to the current crisis as a predictable surprise that rewarded those who had invested in prescient collapse products.

Most people describe the happy days before the crisis as a bull market, but not James Montier. Societe Generale's plain-speaking global head of strategy calls it the "dash to trash" – a period when the madness of crowds led market participants to ignore risk in almost every way.
The collapse that followed this orgy was not an example of one of Nassim Taleb's black swans – a massive and unpredictable event – but a clearly predictable consequence of what was going on in the markets. Indeed, plenty of economists and market watchers did see it coming. Bob Shiller, for example, a Yale economist who prodded Alan Greenspan into making his "irrational exuberance" comment in 1996, first warned of a housing bubble more than three years ago.
He made the following prediction in an interview with the New York Times in August 2005: "A very plausible scenario is that home-price increases continue for a couple more years, and then we might have a recession and they continue down into negative territory and languish for a decade." But Shiller and his fellow sceptics were in a minority.
Montier says there are several reasons why the market consensus was so wildly over-optimistic, despite the alarm bells. First, he argues, many modern risk management techniques helped give senior bankers a misplaced sense of confidence. "Things like value at risk give an illusion of being able to quantify risk," he says. "And yet we can neither quantify nor control risk in any meaningful sense."
To make matters worse, the financial industry also tends to have a self-serving bias towards happy thoughts, because most participants generally tend to do better when markets are rising – so it doesn't serve anyone's interests to draw attention to flaws in markets, accounting models or the banking system, which is why practices such as mark-to-model valuations didn't come under closer scrutiny. "It's like asking a school kid to mark his own homework," says Montier. "Don't be surprised if he gives himself 100%."
Finally, most of us are not good at spotting change. To illustrate, Montier gives the example of a popular study in which test subjects are asked to watch a clip of a basketball game and count the number of passes. Halfway through the video a gorilla walks on to the court and beats his chest, yet when asked about the clip 80% of subjects say they didn't notice anything unusual.
This is a phenomenon known as change blindness, and Montier says it can apply to markets too. "We're not inclined to look for what we don't expect to see," he says.
But some people were, in fact, expecting to see a collapse. Strategists like Montier, who are happy to work outside the consensus, were tracking the bubble as it moved through the stages described by economists Hyman Minsky and Charles Kindleberger. The key stage in the progression is commonly known as a Minsky moment; when financial distress flips into all-out revulsion, asset prices collapse and liquidity evaporates.
Back in June, Montier and the SocGen global strategy team had some particularly strong views that several markets were due to reach their Minsky moments, and his analysis prompted the bank's structurers to create a series of structured products aimed at hedge fund clients that would take advantage of the coming collapse.
At the time, crude oil was at $135 a barrel, the US dollar was at $1.56 to the euro and the S&P500 was at 1,350 points, but Montier was confident that all those values were toppish and the structurers, led by Stephane Mattatia in Paris, calculated the best way to express his views and were ready to go out and sell the products by early September.
Mattatia's so-called collapse-put was a straight forward one-year bet against 10 stock indices and crude oil. The pricing models put a very low probability on the bet coming off, based on the assumption that markets as diverse as Turkey, China and South Africa, as well as those in the developed world, are not likely to fall in tandem. With the odds apparently stacked against him, Mattatia was able to price the option cheaply with a strike of 110, meaning that investors have the right to sell the best performer in the basket at a 10% premium to the early September price.
Of course, as it turned out, the bet came off almost immediately. Right now, the best performer in the basket is South Korea's Kospi 200, down 21% since September 1, which means the option has an intrinsic value of 31% today. The option was priced at less than 3%, so investors are currently sitting on a return of more than 10 times their capital.
Even so, investors who bought the collapse-put may be worried that their bet came off too soon, but Montier is confident that equities are yet to hit rock bottom. Valuing stocks by looking at their price-to-earnings ratio is fine, he says, but only if you discount the effects of the business cycle. One way to do this is to use a 10-year moving average, and by this measure US stocks are not yet "super cheap", he says – they are at roughly 20-times right now, compared to a long-term average of about 15.
Current P/E ratios also support a gloomy outlook. Compared to average P/E levels, markets are signalling a 23% earnings decline in the US, 33% in Asia and 40% in Europe.
The second bet combined Montier's three main predictions: stock markets and crude prices would fall, and the dollar would rise. The triple European digit had a premium of roughly 20% and will pay back 100% after six months if the euro-dollar rate is down by more than 1%, the Euro Stoxx 50 is down by more than 2% and crude oil is down by more than 3%.
That looks like a safe bet today. The euro-dollar rate is down about 13% since early September, the Euro Stoxx 50 is down 28% and the price of a barrel of crude has fallen 47%.
Another of Montier's observations is that the bubble was biggest in the emerging markets, where over-optimistic investors overpaid for the hope of growth. His cyclically adjusted P/E for the emerging markets shows that valuations are still way above long-term averages and have considerably further to fall.
To capitalise on this view, Mattatia's team structured an outperformance trade that pits the two worst performers in a basket of developed market indices against the two best performers in an emerging indices basket. Investors bought a call on the spread between the two with a strike price of 110, and paid a premium of 3.5%.
At the moment the spread is zero, which means that the call is 10% in the money. The S&P500 and Nikkei 225 are down a combined 65%, which is exactly the same as the combined fall of the JSE Top 40 in South Africa and the National 30 in Turkey.
Ironically, the heart of Montier's investment philosophy is that nobody knows very much about what is going to happen in the short term – he describes his prescient call on the collapse as lucky timing – and that the only sensible way to invest is to have a longer time horizon.
By far the biggest contributor to returns during a one-year time horizon are changes in valuations, which, he says, are essentially random. But over a five-year horizon dividend yield and growth in real dividends account for as much as 80% of real returns – and these are things that fund managers should be able to analyse and understand.
Unfortunately, the market is biased against letting fund managers do that. "Good long-term performers underperform in the short-term," he says, which, in effect, means that people who get rewarded on the back of short-term performance are incentivised to underperform in the long term. Or as Montier puts it: "Doing what I say will generally get you fired."