For this Diwali, look beyond pressure cookers, frying pans and 3D TVs. Here is a list of items that’ll last you a lifetime—and these gifts to yourself will keep on giving
Give or take a few, it must have been about 40-45 years ago or so, but the big Diwali gift I received was a new badminton racquet. With something called “nylon guts”, a huge improvement on the previous racket, which had strings made out of natural guts made presumably from the innards of some unfortunate animal.
The old racquet, well and truly retired, was discovered in an even older trunk a few weeks ago. On a whim and a fancy, I took it to a particular shop beyond Ballimaran in Old Delhi run by a man who knew about these things, and asked him to estimate a price on the racket.
Never mind what the racket was valued at—way beyond what I thought it would fetch—but it was the trunk it came out of, a photo of which I happened to have in my camera, that excited him even more.
Because it also contained old magazines and books wrapped in pieces of lace long forgotten, and other stuff, knickknacks collected over decades, yes, but also because the trunk itself now had a value way beyond the metal, wood and rubber it was made of. When I traced its provenance, another surprise—pretty much everything, including the trunk, was from Diwali shopping decades ago.
And everything, including the stainless steel vessels in the kitchen, more Diwali shopping from an era gone past, had pretty much also appreciated.
Fast forward to what appears to be Diwali shopping nowadays, and if you take precious metals aside for the purpose of this article, think about one purchase you make which will not be consumed or depreciate by at least 30% the moment you pay for it... And keep dropping in value steadily thereafter, in many cases reaching a nil residual value in a couple of years?
Matter of fact, the louder and brighter the advertisement, the faster the drop.
So here’s my list of a few items you could purchase for Diwali, not as heavily advertised, but essential to keep in perspective. Diwali is not about throwing money away, it is about welcoming wealth in its many forms, so it doesn’t have to be about blowing up. Hopefully, these are the sort of purchases which will bring you joy, as well as appreciate too.
1) Stainless steel utensils, of all sorts, picked up from any of the traditional utensil shops pretty much top the list. Once you’ve resumed eating out of stainless steel plates, you will give up on using plastic for sure, and may even give ‘China’ glass a pass. Of course, if you can go for silver utensils, then the appreciation and taste are both likely to feel even better.
2) A well-selected painting, or other piece of art, bought after hard negotiations, based not just on the artist’s provenance but also on what you like to see in your home or office. Looked after well, this is almost sure to appreciate eventually, and if you are really so worried about maintaining it, then that is not such a chore anymore.
3) Presenting yourself with a skill-set going extinct. Like maintaining old paintings, for example, since you are building your own collection anyway. It is only when you start looking around for people to maintain your valuable paintings that you realise how much they earn. Almost as much as people who maintain old Ferraris, for example.
4) This takes care, because there is a lot of garbage floating around also, but a good vintage car is a Diwali gift of the sort which will appreciate faster than any other set of wheels. At a modest estimate, you can expect notional prices to double every couple of years, though the joy of owning one often comes in the way.
5) Fractional ownership of commercial property is a new one lately, in an organised way, and still needs very careful thought. This could be a very small share, running into thousands, or much bigger, running into crores, and by a variety of means. Warning—this is a very speculative product, and currently also full of scamsters, so great caution is advised. The time-share property industry gave a bad name to this concept but it may well be time to start looking at the fine print again.
6) Replenish existing equity by adding to the portfolio you already hold or move into equity in a steady way as a mid- to long-term investment. Here it may be important to point out that specific selection of which equity to hold would be based on your own judgement—but spare funds around the festival season or any other time can be moved into this option as a very valid investment.
7) Look around your home and check out expenses being incurred on energy costs, use existing tools on the Internet or elsewhere, or simply commonsense, to see what you can do to reduce these operational costs. The choices are growing by leaps and bounds every day—and prices are flattening out for options like LED (light-emitting diode) lights, double-glazed glass,
motion-sensing switches, solar panels for photo-thermal and photovoltaic applications, and even simple things like ceiling fans.
8) Investments in plants for home, roof or balcony gardens also tend to pay for themselves within two seasons, especially if you take time out to grow selected herbs and spices, which you would buy at high costs otherwise. A lot here depends obviously on the kind of space you have, but in the coming years of high food costs, this is another skill-set which will help survival—if not make you wealthy.
9) Mostly, anything made out of aluminium tends to hold or increase in value— things like stepladders, prams, small carts for moving things around. They are also very helpful for a variety of ‘Do It Yourself’ jobs, increasingly required in and around home, and when they go out of order eventually, scrap value appreciates like with other metals.
10) And finally, any investment made in terms of looking after your health, physical and mental, has an almost immediate payoff. So whether it is heading for that grinding-mill to buy fresh ground cereals, or changing to unpolished rice, throwing out all those sweetened coloured waters and replacing them with natural options, moving to a higher floor for cleaner air, seeking out non-toxic fresh vegetables and non-vegetarian products, discovering the traditional bakery in your part of town which still uses good old pure ingredients—that’s
about the best you can look for in terms of investment.
If you have any other ideas, we at Moneylife would love to hear about
them, and meanwhile, wish you a Happy Diwali and happy appreciation of
your assets. It’s the season, sure, but it’s about welcoming the Goddess of Wealth—not frittering her treasures away.
According to Etisalat, in so far as it has been able to investigate the position, it has not established any basis for the charges levied against Etisalat DB and it expects the company to defend the charges resolutely
Dubai: UAE’s telecom giant Etisalat has said that its Indian affiliate Etisalat DB (EDB) would contest charges filed against it by the authorities relating to the allocation of second generation (2G) licence in January 2008, reports PTI.
“Etisalat would like to inform you that on 22 October 2011, charges were framed against Swan Telecom, in which Etisalat holds 44.7%, and 16 other parties, by the court of special judge (CBI) in relation to the allocation of 2G licences which transpired in January 2008,” Etisalat’s acting group chief financial officer Oussama El Rifai, said in a statement to the Abu Dhabi bourse.
The company said that the charges relate to events that occurred at least one year prior to Etisalat’s investment in Swan (subsequently renamed EDB).
It added that Etisalat had no knowledge of any wrongdoing in the licence application process for Swan and had no involvement in it.
It further said that the licence applications were entirely conducted by the promoters of Swan Telecom who subsequently marketed the Swan investment opportunity to Etisalat through a well-known international investment bank.
The company also said it will continue to assist the Indian authorities in any way that it can.
“The due diligence that Etisalat and its advisers—including leading International and Indian accounting, tax and legal advisors—conducted did not reveal any wrong-doing or grounds for concern.
“The customary representations and warranties were made by the vendors of Swan that the licenses were issued in accordance with the laws and regulations of India,” it said.
According to Etisalat, in so far as it has been able to investigate the position, it has not established any basis for the charges levied against EDB and it expects EDB to defend the charges resolutely.
“Etisalat will, of course, look to its remedies against third parties at the appropriate time in order to protect its investment and rights,” it added.
Marching against corruption in India is akin to marching against corporate fraud in the US. Civic activism across the globe is taking place because the youth want more transparency and fairness in the system
Across the United States and across the world, young people, and some not so young, have gathered in city centres to protest. This so-called and misnamed ‘Occupy Wall Street’ protest is supposed to be about a protest against capitalism and globalisation. But the protest, which has been criticised for lacking in goals, is not about markets. If it was, it could be dismissed. It is about something deeper and more important. It is about fairness.
The concept of fairness is something that is not only basic to humans, it is also found in primates. Monkeys trained to trade pebbles for cucumber slices become less cooperative when some of their colleagues get tastier grapes instead of cucumbers. When the grapes are given to a few monkeys without even the required pebble, the other monkeys will go on strike and toss the cucumber back at the tester and throw their pebbles away.
The protestors certainly have a point. In many countries, the economic divide between rich and poor has been growing. One way to measure the difference is the Gini coefficient. The Gini coefficient is a measure of the inequality of the distribution of a nation’s wealth. It is always expressed as fraction between 1 and 0. If the value is 0, then all citizens of a given country have the same amount of money. If the value is 1, then one person owns everything.
Some of the lowest Gini coefficients are as one might expect in Northern Europe. Sweden and Norway have Gini coefficients of 0.23 and 0.25, respectively. Most developing countries have very high Gini coefficients, with Latin America ranking the highest. Brazil has the top number among the BRICs with a 0.56. China is at 0.47, while Russia’s Gini is at 0.42. Only India remains at a relatively equal 0.36. The Gini coefficient is not only high, it has been rising. In the US in the mid 1980s it was 0.34. It is now over 0.4. China is even worse. Over the same period it went from 0.3 to close to 0.5.
Economic unfairness is not static. I live in the small city of Newport on the east coast of the United States. At the end of the 18th century, the houses of the frugal merchants and seamen were all rather small and about the same size. A hundred years later at the end of the 19th century, the super-rich built huge opulent mansions to be used only in the summer. In those days, the top 0.1% earned 8% of the country’s income. Two World Wars and a Great Depression sort of evened things out. By the 1960s, the number had fallen to only 2%. But things change. By the beginning of the 21st century, the top 0.1% again receives 8% of America’s income.
In contrast, the future for young people around the world is hardly promising. The unemployment rate in the US is 9.1%. For people below 25 it is 17.1%. In the European Union, youth unemployment rate averages 20.9%. In Spain it is 46.2%. This number is not unusual. Perhaps one of the principal causes of the Arab Spring was the unrest among unemployed young men. In South Africa it is over 50%. The recession will no doubt exacerbate these numbers. In the nine past recessions in the US, employment recovered 10 months after the economy recovered. In this one, employment is not expected to recover for another three years.
Is capitalism the source of this unfairness? Not really. The promise of America has always been the promise of rising income due to a market economy. What has changed?
The great economist Mancur Olson pointed out that power groups within a system will, if not limited, take more of the economic pie rather than attempt to grow the pie. To do so they use their power to increase their cut with various methods. Most involve the government and laws. They encourage lower taxes, favourable or discriminatory regulations, preferred access to contracts, higher subsidies, better salaries, protected employment, higher pensions etc. If that is not enough, they simply steal through massive corruption. As the power groups grow richer, so does their power to affect and steal from the government.
But it is not just the avaricious immoral the rich. It is often the old. Conservative Tea Party members in the US and their Left-wing compatriots in civil service unions in Europe and Brazil are comfortable, because the political system works for them. They want to keep it that way.
So what the young people demonstrating across the world want is a fair chance. But what is at stake here is not just their future. Fairer systems are less distorted and encourage economic growth. So in the end they are not trying to destroy capitalism. They are trying to save it.
(The writer is president of Emerging Market Strategies and can be contacted at [email protected] or [email protected]).