Digital Age

This is with regard to “NGO Clean-Up Needed” by Sucheta Dalal. In USA, if an NGO’s income is less than $25,000 a year, all it has to do is file a brief statement online, called an e-postcard. The NGO files a short form every year to indicate it is still active, with the names and addresses of the directors for a fee of $5 with it to take care of the regulatory requirements. The charity commissioner’s office in our country must be brought into the digital age as soon as possible. If they don’t have (wo)man power, I am sure that they will get many volunteers to help them digitise their records.

Meenal Mamdani, online comment


Lost all relevance!

This is with regard to “SEBI De-recognises Regional Stock Exchanges” by SD Israni. This should have happened a long time back; these exchanges were unnecessarily kept alive. Once demat and screen-based online trading became a reality, these exchanges lost all relevance. Investors should have moved away from these exchanges because, I suspect, most companies listed on these must not have been very good, in any case. Companies can shift to the BSE and SEBI should help them in this.


No point saying investors are at the receiving end.

Anil Agashe, online comment


Fix this soon!

This is with regard to “Corporate Espionage and Worse: All Too Common” by Sucheta Dalal. The biggest scams in Delhi relate to counterfeit currency and counterfeit documents, oil and defence deals and, now, judgements from the justice dispensing system. This is, in addition to the loot, scoot and stack of assets abroad.


The present espionage scandal appears to have bound all three together. Hopefully, the new administration will be able to fix this soon.

Veeresh Malik, by email


Contradictory Signals?

This is with regard to “Fortnightly Market View: Reflation Is Here” by Debashis Basu. Last fortnight, the Which Way column indicated that a short-term top was possible. Now, the same column is mentioning a bullish move will continue. The market PE (price-to-earnings ratio) is 24 today (2 March 2014) which is grossly overvalued. Do Moneylife and the market expect earnings to grow more than 20% next year? How to go about this market? Are we to buy, based on more growth, or wait for the earnings to improve? Moneylife is giving contradictory signals and readers are confused. Kindly, provide the needed clarification.

V Ganesan, online comment


Analysis after one year of preferential allotment?

This is with regard to “Unquoted” section in Moneylife magazine. The scrips discussed on stock manipulation are mostly penny stocks. Recently, there have been news reports that the manipulation of penny stocks, after preferential allotment, is to earn LTCG (long-term capital gains) and launder money. The analysis of these stocks, covering aspects like whether the company had done preferential allotment during the past 1-1.5 years (since statutory lock-in of one year is applicable for preferentially allotted shares and to earn LTCG) and the change in the number of locked-in shares of those holding 1% or more of the shareholding, is available on the BSE website immediately after preferential allotment. A similar analysis, which is done one year after preferential allotment, may provide a more insight into the manipulation of penny stocks.

RM Krishna, feedback alert


Developments in Insurance Broking

I would like Moneylife to decipher the recently floated regulations on insurance marketing firms (IMFs). The validity of such a model of distribution seems to be in question, as insurance brokers are already in operating. Also, the regulations allow for 12th standard passed persons to sell insurance products of two life insurers, two general insurers and two health insurers.


While brokers are not allowed to receive any compensation beyond the IRDAI-stipulated product commissions, IMFs are allowed to claim reimbursement from insurers. This is not fair to brokers and corporate agents who incur customer acquisition costs similar to those of IMFs. I would like Moneylife to study this distribution model.

Subba Rao, feedback alert


Criticism of NPS is not correct!

This is with regard to “Just 3 Products to Save Taxes & Earn High Tax-free Returns” by Jason Monteiro and Yogesh Sapkale. I am not able to understand why there is criticism of NPS (National Pension System). This is one of the schemes especially created for retirement {other than PPF (public provident fund) and EPF (employees’ provident fund)}. This Scheme is now backed by an Act of Parliament. There is one regulator and the regulations are being framed which will be applicable soon. It gives the option for a subscriber to choose the asset allocation as per his/her risk-taking abilities. Returns are market-linked. Slowly, tax benefits are being provided. Maybe, in future, it will come under EEE (exempt-exempt-exempt) category, as it is a long-term retirement savings product. Returns are less volatile than in equity schemes, whose future performance cannot be predicted.


It appears that Moneylife is prejudiced against NPS. It is a long-term product and comparing it with equity mutual fund products, which are short-term (there are very few long-term investors), is incorrect. In equity mutual funds, investors come and go, as and when they make money or incur losses.


In my view, Moneylife must revisit its stand on NPS now.

Suresh Bisht, by email


Jason Monteiro replies:

Our analysis is based on the present situation. As and when the regulations are put in place, we will change our views. We mention that one should invest in Section 80C investments, such as ELSSs, for the long term, i.e., 10 years or more. The equity exposure under NPS is limited to just 50%.


Poor Financial Literacy?

This is with regard to “The Fad of Financial Literacy” by Sucheta Dalal. NABARD (National Bank for Agriculture and Rural Development) paints on buses and trains and organises a few video films and audio films in the name of financial literacy. Still, many persons do not know the difference between loans and investments! Several others do not distinguish between money and wealth. MCA’s (ministry of corporate affairs) ritualistic investor education doles are meant to reach the Budget targets and do not fulfil the needs of financial literacy and financial education.

B Yerram Raju, online comment


Simple basic stuff!

This is with regard to “Common Sense Investing” by R Balakrishnan. I have always enjoyed reading the author’s columns, online as well as in Moneylife magazine. I love one of the definitions of value investing that calls it ‘boring’. That’s where people get it wrong. Nowadays, everyone wants exciting news/stocks/career. But the fun actually lies in ‘simplicity’ and ‘simple basic stuff’.

Ritesh Gulrajani


Generate more power!

This is with regard to “GMDC: Growth Phase”. GMDC must think of putting up the second plant to produce the much-needed power in the country and also increase briquettes. Can GMDC associate with Neyveli Lignite and use their joint strengths to generate more power?

Dr Anantha K Ramdas


Sharing and caring

This is with regard to “When doctors assume that they know what a patient wants” by Prof BM Hegde. Thank you, Dr Hegde, for creating awareness about the grey areas in healthcare. The gradual disappearance of the concept of ‘family doctor’ in India and the transfer of healthcare responsibilities to machines and specialists are causing avoidable agony to those who approach hospitals for medical attention. The medical profession and pharma industry are becoming parasites on the ill-health of patients. Some self-regulation and some amount of sharing and caring from the government can reduce the agony.

MG Warrier


Future returns?

This is with regard to “Stock market: Still a Good Time to Jump in?” by Debashis Basu and Jason Monteiro. Everybody is talking about the Nifty and the Sensex, as if all other stocks don’t exist. Though the Nifty is making new highs, the Small-cap Index is well below its life-time high... The future returns would come from this sector... Of course, stick to quality names!

Vinayak Bhimrao Mudholkar



MG Warrier

2 years ago

This refers to Suresh Bisht’s view that ‘Criticism of NPS is not correct!’. Perhaps the comments have restricted implication as Bisht has compared National Pension System(NPS) with two essentially savings instruments namely PPF and EPF. NPS has not yet proved its efficiency as a substitute for Defined Payment based Pension system which was available to government and public sector employees. Kindly seen my letter on the subject published in the previous issue Moneylife (March 19)

4 Ways DirecTV Deceived Consumers, According to FTC Lawsuit

Nation's largest provider of satellite TV faces lawsuit from consumer watchdog agency


Maybe DirecTV’s “Poor Decision Making Rob Lowe” is down with deceptive advertising, but the FTC most certainly is not. The agency is suing DirecTV for allegedly misleading consumers about the costs of its satellite television service. The lawsuit is seeking what could amount to millions of dollars in refunds for DirecTV customers. It alleges that DirecTV deceptively advertised a discounted one-year programming package by failing to clearly disclose:
1. That the package comes complete with the shackles of a two-year contract.
2. That the monthly cost of programming increases anywhere from $25 to $45 in the (mandatory) second year of the contract.
3. That there is a penalty for leaving DirecTV before the two-year contract is up and it is typically $20 for each remaining month.
4. That customers must take it upon themselves to opt out of receiving premium channels, such as HBO and Showtime, before a three-month trial period has expired, or else, going forward, be charged around $48 per month under the negative-option offer, which the FTC found to violate ROSCA.
The nation’s largest provider of satellite television, DirecTV has more than 20 million subscribers across the U.S., according to the FTC. An agency spokesperson told that a “substantial portion” were affected by the FTC’s allegations. AT&T, which has faced its own federal lawsuits alleging deceptive advertising, is in the midst of trying to acquire DirecTV.
DirecTV did not immediately respond to a request for comment from but a company spokesperson told the New York Times: “The F.T.C.’s decision is flat-out wrong, and we will vigorously defend ourselves, for as long as it takes. We go above and beyond to ensure that every new customer receives all the information they need, multiple times, to make informed and intelligent decisions.”
Read more of TINA’s coverage on television services here


Hillary Clinton's Top Five Clashes Over Secrecy

The latest flap over her private emails as secretary of state is far from the first time she's been accused of lacking transparency


Back in April of 2007, when she was campaigning for the Democratic presidential nomination for the first time, then-Senator Hillary Clinton lashed out at the secrecy of the George W. Bush administration.
She told a New Hampshire audience that if elected she would implement a "plan to enhance accountability and transparency" and "to replace secrecy and mystery with openness." One part of her plan: "It's time our government went fully online as well."
She lost her White House bid. But 20 months later, before Barack Obama took that job and she became secretary of state, she set up a private computer server registered to her home in Chappaqua, N.Y., to handle all her official, as well as private, emails for the next four years. Her decision — a secret until earlier this month — impeded efforts by the press and others to review State Department actions.
Today it is Hillary Clinton's record of transparency that has come under fire. At a press conference Tuesday, she acknowledged that in retrospect "it would've been better for me to use two separate phones and two email accounts." She has asked the State Department to release her official emails, a process that could take months.
Few public figures have been as scrutinized as Hillary Clinton. Sometimes her disclosures go beyond what is required, but she's also racked up a reputation for secrecy that at times has returned to haunt her.
Here are five examples covering the last two decades. Some are drawn from a 2007 book I did, with Don Van Natta Jr., entitled "Her Way: The Hopes and Ambitions of Hillary Rodham Clinton. (Little Brown & Co.) Clinton's office didn't respond to a request for comment.
1) 1992: The Commodity Trades
During Bill Clinton's first run for the White House, his campaign declined to release all of the couple's tax returns. Later it emerged that the campaign had weighed requests from the press and decided not to do so, because a few of the returns showed Hillary Clinton's spectacular success in commodities trading, in which she made almost $100,000 from an initial investment of $1,000 in a matter of months for a return of almost 10,000 percent. Hillary Clinton threatened a campaign lawyer who had access to the material with retribution if she released the data: "You'll never work in Democratic politics again," the lawyer, Loretta Lynch, says Clinton told her. It wasn't until 1994, as the New York Times prepared to publish an article detailing the trades, that the Clintons made public the returns.
2) 1993: The Health Care Task Force
As First Lady, Clinton led a presidential task force to overhaul the U.S. health care system. The group, which produced a 1,342-page bill that failed to win approval, came under intense criticism from lawmakers and interest groups for meeting behind closed doors. Several court challenges were brought in an attempt to open the process. Ultimately the courts provided a partial legal victory to the administration. Clinton later wrote she didn't mind the criticism since she was "trying to do something important for people" but acknowledged the failure was partially the result of her "own missteps" in "trying to do too much, too fast."
3) 1994: Records from the Rose Law Firm 
U.S. investigators in 1994 subpoenaed the First Lady's billing records from her years at the Rose Firm in Little Rock, Arkansas, documents that had been also sought by reporters. A focus of their interest was her legal work for a failing savings and loan, but records of those billings weren't found. Much later, Clinton's long-time assistant, Carolyn Huber, said she found in the White House residence an additional box of records that contained the billing memos. They were turned over to the independent counsel in 1996. Clinton testified she had no knowledge of how the records wound up where they did.
4) 2006: The Energy Task Force
Late in her first term as U.S. senator from New York, Clinton set up an energy task force to help her work through the issue, deliver a major speech on the subject and prepare for a possible presidential run, participants in the task force told us for the book. They produced a 40-page report in April 2006. The whole project, including the existence of the group, its members and its work product was a secret, designed, participants said, to encourage frank discussions of the issue. The leader of the task force headed an investment firm with major holdings in the energy sector. Senators routinely get input from outsiders and no law requires their disclosure, but a secret task force is unusual.
5) 2015: The Family Foundation
The Clinton family foundation, now called the Bill, Hillary and Chelsea Clinton Foundation, made disclosures that exceed the legal requirements. Charities are not required to list donors, but as part of Clinton's selection as secretary of state the foundation agreed to disclose the identity of contributors and restrict solicitations from foreign governments. Still, the information on the foundation's website is less than full. Donors are identified but not the exact amount of each donation or the date of those contributions. Instead donations fall under ranges and are listed cumulatively. The foundation did not announce that it started raising money from foreign governments after Hillary Clinton left office. But last month the Wall Street Journal pieced together some new foreign donations after the foundation's web site was updated. That article was the first in a spate of news accounts raising questions about foreign money coming into the Clinton network as she prepares a run for president. The foundation has said donors are carefully vetted and their money goes to important charitable projects.
Related stories: For more coverage, read ProPublica's previous reporting on Hillary Clinton's emails.


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