This is with regard to “Go for Bank FD or RD?” Long ago, I had an FD (fixed deposit) with a prominent private sector bank. On every maturity amount, they would pay one paisa less. With all-India maturity/ renewals, it would amount to quite a sum. When I pointed it out, they took cover saying ‘system set-up’. Why not correct it? No answer.
I asked them ‘why not give one paisa more to FD-holders? They were caught in their own web. I even wrote to the managing director. He was too lofty to reply to a commoner, especially when caught on the wrong foot. Most big-wigs are arrogant. They think it is infra-dig to attend to a common man. Banks mean trust and credibility. But it seems to be so only in books.
Banks say that the effective date will be from the realisation of cheque for investment. Fine. But while paying interest, the banks pay by cheque posted, resulting in 4-5 days delay for credit. It is not done on the due date in the investor’s account. They boast of technology. Why not make instant payment on due date by ECS (electronic clearing service), NEFT (national electronic funds transfer), etc?
I had approached an association or two. They offered me tea, lip-service and conveniently forgot! Mera Bharat Mahan.
The concept of service is alien to us Indians. My friend, a branch manager in a nationalised bank, wanted to migrate to USA. While he was there, he submitted the papers to the relevant office and asked for a receipt. The lady expressed shock and said come tomorrow at 9am. On the dot, she handed over the completed papers and she wished him ‘good luck’. If such a thing ever happens in India, even in the 21st century-level of technology, it would be a miracle.
ND Desai, by email
AUDIT OF COOPERATIVE SOCIETIES
I have been a regular reader and, regrettably, sporadic subscriber to Moneylife magazine for over five years. It carries a plethora of useful information. I am also an avid watcher of the Moneylife videos available on YouTube. So, thanks for the useful work being done by the Moneylife team.
One area where I have not found enough material is about the rights of the members of a cooperative housing society (CHS) to seek information from the statutory auditors regarding the audit conducted by them. Using various provisions of the laws, these guys (it appears to me) are hand-in-glove with the members of CHS and help them cover the misdeeds. Considering that most of us now live in CHSs, it would be extremely useful to carry a series on the rights of the members of CHS to demand information from the CAs (chartered accountants). It would also be useful to know what the CAs required to check before they certify the accounts presented to them.
I look forward to coverage of this issue in coming issues of Moneylife.
Brijesh Gupta, online comment
Thank you for your suggestions. Meanwhile, you may like to check out the queries and replies that are provided by Moneylife Foundation’s legal resource centre at lrc.moneylife.in Issues relating to cooperative housing societies are extensively covered there. The Foundation also runs a free counselling session from 5pm to 7pm every Tuesday by Shirish Shanbagh which is extremely popular. You may want to attend that too.— Editor
BLOW TO COMMON MEN?
This is with regard to the column Fixed Income “Are PPF, SCSS, Sukanya Samridhi Still Worthwhile?” (Moneylife, issue dated 14 April 2016).The cut in interest on small savings schemes (SSS)—Public Provident Fund (PPF), National Savings Certificates, etc, is a blow, especially to senior citizens. With changed times and continuing inflationary trend, the real worth of the rupee is falling every day. Since the share market is not for common people, and especially senior citizens, the easiest mode for investment are the post-office savings schemes as well as PPF and bank fixed deposits (FDs) (on which also the interest rates are too low, compared to earlier years). The one reason on the part of the government to cut down interest rates on SSS is to make interest rates more favourable to bank’s term deposits. This plea is not acceptable, especially for senior citizens. Even the additional interest of 0.05% for senior citizens in bank FDs does not offer reasonable returns on which senior citizens can live. SSSs are ideal for those who do not wish to take the risk of market fluctuations—net asset value (NAV)-based investments, especially for older people (senior citizens). To safeguard returns of senior citizens, interest rates applicable to them should never be lowered; instead a much higher rate, say, of 12% must be guaranteed on all of their investments in SSS, PPF, and bank FDs, etc. The change in rate of interest on PPF must be applicable to new PPF accounts only and not to existing PPF / investments already made in PPF, as it is done in the case of FDs with banks.
Mahesh Kapasi, by email
EVIDENCE-BASED INVESTORS NEEDED!
This is with regard to “Investing as per Beliefs Vs Investing as per Data” by Debashis Basu. We have got to break away from the value religion and we should be evidence-based investors. I think there are reasons why momentum works and the reasons are precisely the same as why value works. Based on my research, the evidence is pretty clear. Buy cheap (value) and buy strong (momentum). The rest is just a waste of time, if you are a long-term investor. Just be an evidenced-based investor and put in hard-coded rules that essentially prevent overconfidence and a belief in stories. A simple asset allocation model, using both value and momentum, combined with a simple trend-following overlay, invests in equities only during sustained market uptrends and avoids all major bear markets.
Sanjay Saxena, online comment
WHY NOT FOCUS ON STRENGTHS ONLY?
This is with regard to “Patanjali: Emulating MNCs or Propagating Ayurveda?” by Sucheta Dalal. Yes, Patanjali is gradually diverting from its path. Patanjali was better and is still good as long as it focuses on Ayurvedic and healthy products. But since this marketing ghost entered, all products have new packaging with fake massages instead of showing Ayurvedic gains.
Just compare Dant Kanti’s previous and current packaging with its pompous message like MNCs’—fights germs, white teeth, 24-hour protection, etc.
MNCs fooled Indians with crass marketing with no actual details of effects of their product composition. Why is Patanjali doing the same? We wanted an Indian brand close to the nature with simple meaningful messages. Why the sudden craze to emulate MNCs with new packaging and with higher costs? Why is there so much of added sugar in biscuits? Patanjali’s products like noodles and honey failed for export quality check with added antibiotics just like other MNCs’. Why not focus on what its strength are? These are really disheartening signals from Patanjali.
Prashant Naikwade, online comment
GOD ALSO CANNOT BLESS US!
This is with regard to “Should Rapists Be Hanged?” by Bapoo Malcolm. Can we inculcate better value systems, healthy attitudes towards women—among individuals, families, relatives and friends? Punishments have never deterred criminals; good values and fear have deterred persons doing wrong. Brutal reactionary laws have created rape and murder as a new challenge for society. Can we get better media representations of women in TV, Internet and newspapers? Women should themselves take this onus. Earlier, there was one cabaret in every film; but now heroines are scantily clad in entire movies with heroes too doing the same. God also cannot bless us, if we lose our guiding lines.
Mahesh S Bhatt, online comment
ALERTS ABOUT EPIDEMICS ARE IMPORTANT
This is with regard to “The Epidemic that Wasn’t” by Prof BM Hegde. The one good point in this article is the recommendation to give mosquito nets to people who live in mosquito-infested areas. It is strange that the article blames organisations like the WHO (World Health Organisation) for giving alerts about possible epidemics. As the writer should know, it is better to provide warnings of possible epidemics than try to stop the spread of one that is already in progress. Then, the author would blame the organisation for sitting by doing nothing, while the epidemic caused havoc.
WHO can only announce alerts and report the possibility that something may happen. So, if it does not happen, should we blame WHO or should we thank it for alerting countries to take precautionary steps and stopping the infection from spreading and becoming an epidemic? This article reminds me of the argument my mother used to have with me. If her blood tests did not show any abnormality, she believed that her money was wasted and she had been defrauded. She had been raised with the practice in India that one only gets a test done after one has become ill. The idea of preventive medicine was novel to her, as it seems to be for this author.
Meenal Mamdani, online comment