Unscrupulous investment opportunities can empty out your wallet. Before committing any money, have a big think about the pluses and minuses of the offers, read the fine print, and only invest in products you comfortably understand
Shady investment opportunities employ aggressive marketing tactics in an effort to get consumers to open up their wallets as wide as possible. Here are some red flags to watch out for in the advertising of these dealings to help protect you from falling victim.
1. Glowing testimonials. All of the testimonials, almost half of which targeted the elderly or those planning for retirement, had omitted vital information, including the risks involved with investing money. Many of the testimonials did not appear to report results that are typical or achievable for the ordinary subscriber. And some contained blatant lies.
2. Graphs that tout tremendous growth. While an investment in gold and other precious metals can help diversify your portfolio and help hedge against inflation, you should ask yourself some questions before pulling the trigger on a big purchase. The truth is the price of gold fluctuates over time and there is no guarantee the commodity will increase or even maintain its value
3. Claims of investing secrets revealed. A 770 account is not really a secret bank account; it’s a whole life insurance policy, and it’s no secret. Think carefully before paying for any investment newsletter advertising this way — if something in the advertising sounds unbelievable, you probably shouldn’t believe it.
4. Again, claims of investing secrets revealed. While the ads seem to indicate you can get 1000% returns using the Biblical Money Code, it’s far more likely you’ll just get some common-sense investing tips and a $47 newsletter.
5. Opportunities to trade someone else’s money. The prospect of trading thousands and keeping the majority of the profits is the focus of the website, which never tells you how many people who sign up for the costly educational course ever end up being chosen to trade the money and keep profits.
6. Offers that advertise a “free” amount of anything. “We’re holding $500 worth of free silver coins!” reads a headline on learsilver.com. “Just for you!” But the reality is you have to purchase $20,000 of silver from the precious metals seller before you get the $500 worth of “free” silver.
7. Offers that advertise a “simple” approach to investing. So while the offering may appeal to you, know that a fixed index annuity is not simple and it’s not an investing or retirement panacea. Ask lots of questions. Consult an independent financial advisor
8. Sites that guarantee your satisfaction. The policy that a customer pays for any market loss on returns but any market gains on refunds goes to, you guessed it, the company.
9. Get-rich-quick pitches. Before jumping into any penny stock, consumers should just be aware that there have been major penny stock scams in the past, and investment experts say that penny stocks are very risky and generally warn people to be careful about investing their money this way.
Before committing any money, have a big think about the pluses and minuses of the offers, read the fine print, and only invest in products you comfortably understand. Also, it doesn’t hurt to get a second opinion from a trusted source. The more you go it alone, the more you may be susceptible to one of the above marketing ploys.
Former Managing Director of Konkan Railway and pioneer of the Skybus Rajaram Bojji, popularly known as B Rajaram wrote an open letter to new Railway Minister Suresh Prabhu with practical suggestions and possibilities for drastically improving the Indian Railways
Rajaram Bojji or B Rajaram, inventor of the indigenous & cost-effective anti-collision device (ACD) technology and former managing director, Konkan Railway has written an open letter to Suresh Prabhu, the new Minister for Railways. In the letter, Mr Bojji has provided practical suggestion to improve the Indian Railways.
Shri Suresh Prabhu,
Minister of Railways,
Dear Shri Prabhu,
“I am personally very happy that a person like you, with balance in thought and speech will head the tough Railway Ministry. Many will rush to advise you, but the very size of the system could overwhelm anyone, with the Railway Board making life miserable by dumping you with day to day operational problems and mishaps.
Midnight calls would likely keep you awake.
I just want to share some ideas and advice more as an old friend. Suppose I happen to be in your shoes what I would do?
Here are some brief action points. We all know that the Railways need modernization. However, our Railway Board is busy building its own individual departmental empire. Too many committees have come out with voluminous or simplistic reports. Give more money or import is the solution they come up with and grand numbers like Rs1 lakh crore. But what about viability?
In my opinion, it is irresponsible to give financially suicidal recommendations. Foreign direct investment (FDI) is glibly talked about and immediately our babus push for foreign technology based brand new workshops or manufacturing facilities, with guaranteed cash outflow but without guaranteed performance levels of output to improve revenues or safety. I suggest FDI or public-private-partnership (PPP) should always be based on the principle of assuring least financial burden on the Railways in particular and on the nation more generally.
Some examples of effective application of FDI and PPP:
1. Modernization of technology for coaches and locomotives:-
Existing manufacturing facilities all be handed over in exchange for equity stake, to modern technology providers creating a technology upgradation PPP. Every 5 years, technology modernisation cycle should be planned. Export to foreign markets, Make in India also should be a condition. Our assets, valued at current prices, be handed over and any profit the PPP makes will be shared by the Railways. Assured order quantity be committed in return for the above. The FDI has to be accepted only from technology leaders in that area. It is not money, but technology we need. No fresh land or structures are needed. Instead of one-time technology upgradation, we will get assured technology upgradation for a longer period. We will also save on staff costs and material costs. Current staff should be offered VRS or relocation. The FDI PPP may re-engage with better salaries for deserving staff.
2. Case of keeping stations clean:
Adjust current costs (like maintenance, cleaning, managing security , parking facilities, food sales, parcel management, etc) for inflation and make it an annual guaranteed payment. Assets of the station and the land around should be valued at current market prices and treated as stake of railway in the proposed JV. Private party with sound financial standing should be invited to form PPP to provide modernization of station equipment like escalators, retiring rooms, cafeteria facilities, refurbished flooring and lighting, and with quality of service certified by a third party like Technischer Überwachungsvereina (TUV). The income stream for this JV company is the guaranteed cash inflow from Railways, the proceeds of platform access charges for non passengers, cafeteria food sales, commercial exploitation of land attached to station. This PPP JV can raise debt funding based on capital at charge for modernizing the station facilities to improve revenues. As major equity holder, Railways will share profits of the company, but will not be part of management. The company board will have a Railways representative. This step can unlock the unearned value of railway properties in and around stations and change face of the Railways.
3. Medical Organisation:
Railways has more doctors than officers running railways. The hospitals too are well developed and sit on prime properties. All the real estate should be transferred at current market value along with the equipment into a JV. With a well recognized hospital and medical healthcare management company, all Railways doctors should be offered alternate placement in the PPP JV. Similar to station service management, the JV will use this equity base to raise funds in the market, modernizes streamline and offer better quality service to railway employees. What is the assured revenue stream? Here gain take the current cash outflow on medical services and offer the same for each Zonal Railway to to set up a JV on this basis. Further commercial exploitation of lands also be allowed. Railways will hold a major share in the company and automatically get profit shares. So all medical services in railways thus will get managed by 10 or 15 PPP mode JVs. Again Railways by agreement shall not be in management. Only Board of Directors of each company will have Railways representatives. Digital networking, telemedicine and smoother workflow, shall be part of the agreementm with medical records of employees becoming accessible all over India. The company should be allowed to take outside patients too, as paying customers, including foreign patients. Medical tourism should be actively encouraged. All this, without neglecting railway employee interests.
4. Railway Colonies:
Even today, huge land space is occupied by railway colonies with sprawling bungalows. It's time we form a JV with our land and buildings valued at current market prices, with private real estate companies. For railway officers and staff, modern flats with amenities can come up, increasing capacity and providing excellent facilities by land reuse. Old and difficult to maintain bungalow culture must be done away with. More green space, biking tracks, neater and tidier roads with lighting should be built. Apart from the assured cash inflow at current costs, being incurred by the Railways, the PPP can generate additional revenue streams by building modern supermarkets, high-end entertainment and shopping malls in the land released. Funds can be easily raised because of the heavy equity base of Railway assets transferred at market rates. The rent payments of employees will go to the company. The company becomes responsible for maintenance, water supply, sanitation etc. Railways again gets share of profits. Saves staff costs and material costs as well as contractual costs of maintaining huge colonies with major concentrations of employees.
5. Track machines, track laying equipment, welding and ballasting:
Railways should not own any of the above. Transfer all related equipment to a JV with PPP . Provide assured cash flow in terms of current cash outflow for promised outputs as laid down today. Modernization of equipment, improved productivity, assured quality can be well defined and third party quality assurance certification part of deal. New line construction also is to be handled by these JVs. Profits will be shared by Railways as stakeholder. But no management participation by Railways except representation in Board of Directors of the JV company. For the entire Indian Railways, about 10 or 12 companies can be supported.
Electrification too can follow the above model by collaborating with zonal level service providers through JVs.
7. Improving speeds, throughput and safety:
Get rid of fixed signals, have cab signalling, moving block system for train operations. Indigenous technology is available and has been tried for 160 kmph speed successfully. Railways should use the advanced version of ACD (Anti-Collission Device), India's own technology.
Average speeds can be raised by 30 to 50% for goods and passenger trains, as well as doubling capacity.
This would cost less than one-third the imported alternative technologies. And we already have rolling stock technology for 160 kmph speeds, which can be upgraded to 180 kmph.
Safety needs to be assured by adopting Safety Integrity Level (SIL) of 2/3 of CENELEC certification, not by RDSO.
8. Make Zonal Railway Departments centres of responsibility and authority:
Most important step is to make zonal railway a centre of responsibility and authority. Wide area digital networking on the lines of Konkan Railways, integrating all facets of railway operations, must be implemented.
With these measures, Railways can create profit centers from current cost centers. Efficiency will improve, people will see a new face of Railways to be proud of. This would be financially sound too!”
(Rajaram Bojji or B Rajaram as he is known popularly, is former managing director of the Konkan Railway and also inventor of ACD Technology and Skybus)
Only a strong event or news can drive the market significantly higher
In line with what we mentioned in Tuesday’s closing report, the Indian indices opened higher and broke the previous lifetime high it hit on Monday. However, lower volumes supported the rise today on the Nifty. The surge in the morning session to the new lifetime high was followed by a gradual move down. However, the benchmark indices managed closing in the green.
S&P BSE Sensex opened at 27,959 and moved from a high of 28,126 to a low of 27,959 and closed near the day’s low at 28,009 (up 99 points or 0.35%). NSE’s CNX Nifty opened at 8,379 and hit a high of 8,415, and moved lower to the level of 8,371 finally closing at 8,383 (up 21 points or 0.25%). NSE recorded a lower volume of 92.07 crore shares. India VIX fell 2.47% to close at 14.4350.
The government unveiled industrial production data for September 2014 today. IIP growth for September 2014 was at 2.5%, compared to 0.4% recorded in the month of August. September IIP was above estimates.
The CPI (consumer price index) inflation stood at 5.52% in the month of October as compared to 6.46% reported in the month of September.
The empowered committee of state finance ministers on goods & services tax (GST) at its meeting held on Tuesday reportedly agreed on the 'place of supply' rules that form the backbone of the proposed GST.
The Petroleum Ministry, in a notification, relaxed rigid timelines prescribed in the production sharing contract (PSC) for development and production of oil and gas.
Bayer CropScience (10.35%) was the top gainer in the ‘A’ group on BSE. The stock hit its 52-week high today. After market hours on Tuesday, the company came out with its September 2014 quarter results. It posted a net profit of Rs 176.10 crore for the September 2014 quarter, compared to Rs 116.50 crore for the September 2013 quarter.
Sales increased from Rs 1,050.40 crore to Rs 1,241.00 crore for the relevant period.
Hindustan Construction (4.49%) was the top loser in the ‘A’ group on BSE. It informed BSE that Lavasa Corporation Limited, its subsidiary, received observation letter from SEBI for its proposed initial public offering of equity shares, for an amount not exceeding Rs 750 crore.
Axis Bank (3.02%) was the top gainer in the Sensex 30 pack. It hit its 52-week high today. Cipla (3.06%) was the top loser among the Sensex 30 stocks.
US indices closed in the positive on Tuesday. The National Federation of Independent Business said that its small-business optimism index rose 0.8 points to 96.1 in October, a two-month high.
Philadelphia Fed's President, Charles Plosser, today said US interest rates should be raised "sooner rather than later." In a speech in London, Plosser said rising rates are not inconsistent with a continuing recovery.
Asian indices showed a mixed performance. Shanghai Composite (1%) was the top gainer while Taiwan Weighted (1.28%) was the top loser.
There is a growing anticipation that Japananese Prime Minister Shinzo Abe will postpone a planned sales tax hike to avoid damaging a fragile recovery.
European indices were trading in the red. US Futures too were trading lower.