Screwed!!

A friend recently had a windfall and landed some good money. He (being a saving type) does not want to splurge it on consumption goods, but wants to use the corpus to ensure financial security later in life. He is a worried man!
He narrated his logic to me thus:
1) if he keeps the money as cash, inflation erodes its value very quickly
2) if he invests in stocks, going by his recent experiences, he could see the value of his windfall decline 30% in a week
3) the amount is not large enough to buy any real estate. Moreover, he does not want to take a loan and buy property in these times of rising interest rates
4) if he keeps it in a fixed deposit, negative real interest rates screw him
5) he would like a new car, but he thinks rising oil prices will make running costs prohibitive

Not being entirely sober at that time, I suggested he roll up the entire amount, and throw it 'on the toss of a coin' (as Kipling would have said, rather written) on crude oil futures. Alternately he could punt on a short position on the US dollar.
That is the only certain thing in these bedevilled times!!

Thought for the day

I met a hugely successful person (by all conventional standards) today. Though he had a tendency to speak in rhetoric, one good thought he left with me -
'Don't run after money, because then you are only running along with everyone else. Follow your principles, do what you do best and let money run after you'

Not reproduced here verbatim, but substantially to similar effect. I love it!!

Powerful

I saw Aamir yesterday, and was blown away by the movie. It is gripping, hard-hitting and powerful. One needs a strong stomach to watch the thing. Although it evoked very mixed reactions from the people around me, without giving anything away, a few things that really stood out for me in the movie:

• The humanity of the protagonist - the guy is an everyday joe, doing what anyone would in his situation. What he does at the end, when he takes charge of his own destiny, is something that requires great courage. The alternative was quite easy to do, and putting myself into his shoes, I probably would have taken the easy way out - I could not have done what he did
• The depiction of Bombay - very real (brutally so!)
• The taut script - no needless subplots, no (melo)dramatic dialogue, good background score, good acting. The name itself - Aamir - which means a leader of men - is very apt
• The thoughts it provoked in me - the essence of the movie is that everyone is responsible for their own destiny, and that there comes a time when (to express it most beautifully) a guy's got to do what a guy's got to do. An individual is a trifle, insignificant and immaterial. There comes an opportunity to transcend oneself, to become greater than the sum of your existence and the society around you. The one who grabs that opportunity is Aamir

Day dream

Malvinder Singh is a guy I envy right now. The dude is all set to pocket approximately $2.5 bn (or Rs. 10,000 crores - the number of zeros in that number has me reeling :-) from selling Ranbaxy to the good Japanese at a hefty premium to market.
Without going into usual debate over whether he did the right thing or no (suffice it to say I approve of the transaction), the more interesting debate in media right now is - what the blazes is he going to do with Rs. 100,000,000,000 (thats 11 zeros folks!)?? Mr. Singh still has a job (he will continue to lead Ranbaxy), and he has made some noises about making Religare a bank (though I dont think he is very serious when he says that), but all this does not prevent me from fantasizing about what I would do if I ever laid my hands on such moolah.
Of course my initial thoughts run to tropical islands, decadent living and luxury homes, but then I decided to find out what use better minds than mine have figured out for money.

• Till recently Mr. Rich Man #1, Bill Gates has decided to give away all his money to the Bill and Melinda Gates Foundation, which will use it to prevent AIDS, and organize social initiatives in poor economies like India / Bangladesh etc.
• Mr. Rich Man #2 (and God to legions of investors), Warren Buffett will give away his entire fortune to (surprise surprise) the Bill and Melinda Gates Foundation
• Not too long ago India's richest family, the Tatas, use all the profits from the Tata companies (via Tata Sons) for charity...

I begin to see a pattern. And it gives me ideas. What I would really do with Rs. 9,990 crores (I have put away 10 crores in the bank, remember?) is

a) build a huge university. The university will operate on a pure capitalistic model, with extremely high standards of admission, the best paid faculty, and the best hostel infrastructure, and a market driven fee strucutre. However, the poorest 30% students would get scholarships which would cover their tuition fee (the funds for this would come from interest from an allocated amount). (I will need to devise some smart way of figuring out the real deserving poor students vs. rich kids whose parents get their income through 'unofficial' means)

b) build a huge hospital, extremely modern and efficient, with the best infrastructure, the best paid doctors and nurses, and market rates for treatment. However, the poorest 30% patients will get diagnosis, treatment and medicine for free (funds to come out of interest on an allocated amount)

While I actually have no clue if this would cover the amount at my disposal, I have an idea it would be enough. Anything left over I will hand over to my wife to invest in equity markets and multiply manifold, the proceeds of which I will use to buy my decadent island :-)

Greener grass

After an intense week (and weekend) spent furiously working away, including an entire weekend spent in office, minimal sleep (it is now 1:15am and still a couple of hours to go before i can call it a day) and lots of stress, clarity emerges on some key issues -

1. Family is your most precious asset - without loving and caring family one is finished
2. Better work somewhere you really like - otherwise every challenge beomes a huge burden
3. There is no free lunch - there are trade-offs in almost everything in life
4. Living today is the only way to live - who has seen tomorrow?
5. The grass is always greener on the other side
6. Sleep is the most under-rated luxury